South Korea could release $6bn in Iranian money amid US prisoner release talks

Funds were frozen by Washington in 2018 as it ramped up sanctions on Iran under Donald Trump

Iranian Foreign Minister Hossein Amirabdollahian spoke on the phone to South Korean Foreign Minister Park Jin. AP
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About $6 billion in Iranian funds frozen in South Korea could soon be released, Seoul’s Foreign Minister Park Jin said on Monday, after a deal on US citizens held in Iran was reached.

The funds were frozen in 2018 under stringent US trade sanctions during a campaign by former president Donald Trump known as “maximum pressure”. Iran retaliated with a series of attacks on energy infrastructure in the region, also seizing a South Korean oil tanker.

Mr Park told Iranian Foreign Minister Hossein Amirabdollahian by phone on Monday that the countries involved were in close communication to resolve the issue, Seoul's Foreign Ministry said on Tuesday.

Mr Park and Mr Amirabdollahian agreed to expand co-operation between the two countries, the ministry said.

Washington and Tehran reached an agreement last month for the release of five US citizens detained in Iran while $6 billion of Iranian assets in South Korea would be unfrozen.

The assets that had been frozen in South Korea were transferred to Switzerland's central bank in August for exchange and transfer to Iran, South Korean media has reported.

The funds will be a major boost to Iran’s economy as it continues to rebound from Covid-19 and the defunct maximum pressure campaign, which sought to sharply curtail Tehran’s oil exports.

The US sanctions on Iran’s energy exports have continued and oil sales are now approaching two million barrels per day – pre-sanctions levels. But Iran has had to sharply discount its oil sales to entice buyers who are willing to take the risk of clandestine purchases, eating into Tehran’s revenue.

Updated: September 05, 2023, 4:24 AM