Russia Bank Governor Visits Iran to Strengthen Financial Ties

Russia Bank Governor Visits Iran to Strengthen Financial Ties
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Elvira Nabiullina has successfully guided Russia’s economy following the imposition of unprecedented sanctions.

Bank of Russia Governor Elvira Nabiullina visited Tehran for talks with her Iranian counterpart, Mohammad-Reza Farzin, Bloomberg reported on 25 May.

The talks focused on strengthening relations between commercial banks from the two heavily sanctioned countries as well as “increasing banking infrastructure cooperation,” Iranian central bank Governor Farzin said.

Nabiullina also participated in talks during the Asian Clearing Union meeting in Tehran, which Russia is attending as an observer along with officials from Belarus and Afghanistan. According to Iran’s semi-official Tasnim news agency, Iranian First Vice President Mohammad Mokhber discussed efforts with Nabiullina to eliminate the use of the dollar in transactions with Russia.

Nabiullina’s visit to Tehran follows that of Deputy Prime Minister Alexander Novak, President Vladimir Putin’s top energy official, last week.

Once lauded by western officials, Nabiullina faced unique challenges following the start of the war in Ukraine in February 2022. Western governments froze some $300 billion of the Bank of Russia’s foreign reserves and imposed unprecedented economic sanctions on the country which caused a sharp drop in the value of the ruble.

However, Nabiulla was able to stabilize the ruble and manage the economic fallout from Russia’s disintegration from the US-dominated global financial system.

A graduate of Moscow State University in 1986, Nabiullina rose through the ranks of the USSR Science and Industry Union and its successor, the Russian Union of Industrialists and Entrepreneurs, and then through the ministry for economic development and trade before becoming head of the central bank in 2013.

In 2014, Nabiullina took the important step of allowing the ruble to float based on market conditions.

Following the Russian invasion of Ukraine, she sought to resign as governor but Russian President Vladimir Putin rejected the request and nominated her to a new five-year term.

Nabiullina’s visit to Tehran follows an agreement reached in January between the Russian and Iranian central banks to improve financial and banking transactions between the two countries. State-owned VTB Bank PJSC, Russia’s second-largest lender, has since opened an office in Iran.

Russia and Iran have increased economic and military cooperation in the face of western sanctions. Last week, President Putin and Iranian President Ebrahim Raisi signed an agreement to build a railway line linking Russia to India through Iran.

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