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Iran accepts tea in payment for Sri Lankan oil debt

Agence France-Presse
Iran accepts tea in payment for Sri Lankan oil debt
Costumers drink tea outside the smallest and oldest teahouse tucked away in an alleyway of the Grand Bazaar in the Iranian capital Tehran on September 20, 2021. In between pouring glasses of steaming brew for his customers, owner Kazem Mabhutian tells the century-old story of the fabled Haj Ali Darvish Tea House with pride.
ATTA KENARE / AFP

TEHRAN, Iran — Iran has agreed to accept  Ceylon tea in payment for a Sri Lankan oil debt valued at $251 million, Iranian media reported Thursday.

"In recent negotiations, we reached a written deal to reimburse Iran's debt and interest on it in the form of a monthly shipment of tea produced in Sri Lanka," the head of Iran's Trade Promotion Organisation said.

Alireza Peyman-Pak was quoted as saying that "a deal was reached on Tuesday, according to which Sri Lanka will export tea to Iran every month to settle a $251 million debt for Iranian oil supplied to Sri Lanka nine years ago".

In 2016, Ceylon tea made up nearly half of Iranian consumption, but the proportion has declined in recent years.

The barter deal will allow sanctions-hit Iran to avoid having to use up scarce hard currency to pay for imports of the widely consumed staple, Peyman-Pak said.

"Iran and Sri Lanka have great potential to develop mutual trade," he said, adding that Iran's non-oil exports to the country are valued at less than $100 million a year.

Sri Lankan Plantation Industries Minister Ramesh Pathirana said the deal "will not violate any UN or US sanctions since tea has been categorised as a food item under humanitarian grounds", according to the Economynext website.

He added that Iranian banks that have been blacklisted under US sanctions will not be involved in the transaction.

vuukle comment

CEYLON TEA

IRAN

SRI LANKA

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