2024-02-22T15:20:03+00:00
A-
A
A+
/ Sri Lanka, which is suffering from a shortage of foreign currency, said on Wednesday that it had exported $20 million worth of tea to Iran to pay off part of its $251 million oil debt, in a deal that won the “satisfaction” of the Iranian foreign minister.
“So far, $20 million worth of tea has been exported to Iran under the barter trade agreement,” Sri Lankan Prime Minister Dinesh Gunawardena’s office said in a statement, according to Al Arabiya, after holding talks with Iranian Foreign Minister Hossein Amir Abdollahian, according to AFP, which was reviewed by Al Arabiya Business.
The tea-for-oil deal between the two countries was agreed in December 2021, but tea exports were delayed by the economic crisis that hit Colombo and forced then-President Gotabaya Rajapaksa to step down in July 2022. The barter deal allows Iran, which is under Western sanctions, to avoid using hard currency to pay for tea imports.
Sri Lankan officials had previously said the tea-for-oil swap did not violate U.S. sanctions on Iran, because tea is a food item and there was no need to deal with blacklisted Iranian banks.
The island defaulted on its $46 billion foreign debt in April 2022 and received a $2.9 billion bailout from the International Monetary Fund early last year.
Ceylon tea, known as Jazeera during the colonial era, accounted for about half of Iran’s consumption in 2016, before declining in recent years.