Turkey is pushing for Iran to switch to use local currencies in bilateral trade and ditch the euro and the U.S. dollar in the latest effort amongst emerging market nations to further de-dollarization.
According to Bloomberg, Turkish President Recep Tayyip Erdoğan used a meeting with his Iranian counterpart Hassan Rouhani in Tehran to lobby for dropping euros and dollars in favor of bilateral trade in local currencies.
Trade between the two nations has “lost momentum” in recent years due to sanctions imposed against the Islamic Republic, Erdoğan said during a joint press conference with Rouhani on Tuesday.
Total trade volume was $14 billion last year versus the targeted level of $30 billion, Erdoğan said.
“We shouldn’t remain under the pressure of the euro or dollars,” Erdoğan said. Although central banks from the two countries have been working on the use of local currencies to facilitate trade, those negotiations haven’t yet yielded an agreement, he said.
Erdoğan’s visit to Tehran was the first by a Turkish president since 2011 and comes as the two neighbors are on opposite sides of regional conflicts. The crisis in Yemen has pitted them against each other, with Turkey saying it supports Saudi Arabia-led operations against Yemen’s Houthi rebels, who have ties to Shiite-majority Iran.