The US regime has announced a spending plan for frozen Iranian assets as negotiations to end the Middle East war continue. The Trump administration insists the unfrozen money will be used to buy US agricultural products, which will then be provided to Iran.
This could translate into a $12 billion boost for the heavily restricted bilateral trade between the US and Iran, currently limited mostly to humanitarian goods. After the first round of talks in Switzerland, Iran's top negotiator Mohammed Bagher Ghalibaf said an agreement had been reached to release $12bn in frozen funds.
However, US Vice President JD Vance claimed the assets would be used by Iran to buy US agricultural products. President Trump posted on Truth Social: "The Money goes into escrow, controlled by the U.S.A., and will be used for the purchase of food and medical supplies, exclusively from the United States." He called it a humanitarian crisis and said talks were going well.
Iran has not confirmed agreeing to these terms. Foreign Ministry spokesman Esmaeil Baghaei said the assets "will be released and will be employed with absolute liberty by Iran to purchase whatever goods needed." He added that any agricultural purchases would be based on "prices and quality," not terms "dictated by Washington." Iran's ambassador in Geneva also rejected the US contention.
Analysts suggest the proposal is aimed at boosting Trump's popularity among US farmers hurt by the trade war with China. Cullen Hendrix of the Peterson Institute said it could be a way of "avoiding the straightforward transfer of funds to Iran, which would scan as a capitulation by the US."
Total US-Iran goods and services trade reached $838m in 2024, with $742m in services. Experts say re-establishing broad trade ties is unlikely, as neither side appears willing to sell such an arrangement domestically. Even if forced to make some purchases, Iran is not expected to hardwire dependence on US exports into its food system.
Before the 1979 Islamic Revolution, Iran was one of Washington's closest allies in the Middle East. Trade expanded rapidly from the 1950s to the late 1970s. However, after the 444-day hostage crisis at the US embassy in Tehran, President Jimmy Carter froze billions in Iranian assets and banned Iranian imports.
Source: www.aljazeera.com