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Taiwan exempted from US sanctions on Iran oil

Taiwan banks have been exempted from U.S. financial sanctions over the next 180 days after the island significantly reduced oil imports from Iran. (Courtesy of Allen Hsu)

• Publication Date：06/13/2012
• Source： Taiwan Today

Taiwan is among seven economies exempted by the U.S. this week from financial sanctions for importing oil from Iran, the ROC Bureau of Foreign Trade said June 12.

U.S. Secretary of State Hillary Rodham Clinton announced in a statement June 11 that the sanctions pursuant to Section 1245 of the National Defense Authorization Act for 2012 would not apply to Taiwan, India, Malaysia, South Korea, South Africa, Sri Lanka and Turkey, because they have significantly reduced their Iranian oil imports in recent months.

The act, which came into effect Dec. 31, 2011, expands U.S. sanctions against Iran to include its central bank and financial institutions, with the aim of preventing it from obtaining the capability to produce nuclear weapons.

The law requires that foreign banks refrain from settling oil imports with the Iranian central bank or face U.S. financial sanctions, with the stipulation pertaining to foreign private banks taking effect Feb. 28 and that applying to foreign public and central banks to come into force June 28, according to the BOFT.

In line with the new act, the ROC Ministry of Economic Affairs instructed state-run CPC Corporation, Taiwan and Formosa Petrochemical Corp. to cut their imports of Iranian oil, the BOFT said.

The seven nations join 11 others, including Japan and several EU member states, exempted from the U.S. sanctions in March. The exemption is for a period of 180 days, the bureau said.

In 2011, Iran was Taiwan’s 27th largest trading partner, 30th biggest export market, and 20th main source of imports. For the year, exports amounted to US$920 million, with plastics and manufactured goods accounting for 24.5 percent, while imports reached US$2.49 billion, with oil and minerals accounting for about 80 percent, according to the BOFT.

The new U.S. regulation has had an effect on trade between Taiwan and Iran, with the island’s exports for the first three months of 2012 totaling about US$160 million, down 18 percent from the same period last year, the BOFT said. (SB-THN)