South Korea frees Iran funds

The South Korean government confirmed Tuesday that it had transferred to Qatar Iranian funds frozen in South Korean banks under US sanctions, as part of a prisoner swap deal that led to the US and Iran releasing five of each other’s detainees.

Tehran’s access to $6 billion in oil revenue had been frozen since May 2019, when Washington, after scrapping the 2015 nuclear agreement with Iran, stepped up pressure to block hard currency from flowing into the Middle Eastern country.

“South Korea had been in close consultation with the countries concerned to resolve the issue, with the understanding that the money there belongs to the Iranian people,” the Foreign Ministry in Seoul said in a statement.

The US has said the funds will be used strictly for humanitarian purposes like food and medical supplies, saying it has some control over when and how it is used. But Iran contends it will spend the funds to address the “needs of the people of Iran.”

In the statement, the ministry said it also expects the funds to be used for humanitarian goods. Before the release, Seoul had delivered such aid to Tehran with payment coming from the deposit.

The ministry added that it thanked Qatar and Switzerland for their role in the exchange. Switzerland, which has represented US interests in Iran since the two cut ties following the 1979 Islamic Revolution, is one of the three interlocutors along with Oman to have facilitated the deal.

The latest exchange is a follow-up to how the US has said it wants to deal with Iran. US President Joe Biden has said he would give diplomacy a chance, after the sanctions campaign led by his predecessor, Donald Trump, had escalated tensions.

Reviving the 2015 deal is not on the table. Trump abandoned it arguing simply setting limits on Iran’s uranium enrichment in return for sanctions relief is not enough to prevent the country from acquiring nuclear weapons. Iran denies it wants them.

“When it comes to perhaps the No. 1 issue of concern, which is Iran’s nuclear program, we continue to believe that diplomacy is the best way to get a sustainable, effective result,” US Secretary of State Antony Blinken told reporters in New York

World leaders including Biden are there this week for the annual meeting at the UN General Assembly. Iranian President Ebrahim Raisi is set to be at the gathering but high-level meetings are not expected to take place to iron out their differences.

The White House confirmed that a plane carrying the five Americans, along with two of the detainees’ family members who had also been prevented from leaving, is en route to the US.

Two of the five Iranians to be released from US custody will return to Iran while two will stay in the US, the Iranian Foreign Ministry said, adding the remaining one will leave for a third country to join his family.