Malaysian Prime Minister Mahathir Mohamad has stated that his country, Iran, Turkey and Qatar may use the Iranian medieval gold coin, the dinar, as well as barter trade as a hedge against economic sanctions.
“With the world witnessing nations making unilateral decisions to impose such punitive measures, Malaysia and other nations must always bear in mind that it can be imposed on any of us," Mahathir said during the 2019 Kuala Lumpur Summit in the Malaysian capital on Saturday.
He apparently referred to the situation related to Saudi Arabia, the United Arab Emirates, Bahrain and Egypt severing diplomatic and trade links with Qatar in 2017 over allegations that it supports terrorism, as well as the US’ anti-Iranian sanctions that Washington imposed after its pull-out from the Iran nuclear deal.
“I have suggested that we re-visit the idea of using the gold dinar and barter trade among us. We are seriously looking into this and we hope that we will be able to find a mechanism to put it into effect”, Mahathir added.
Rouhani Urges Islamic World to Break Free of ‘Dollar Domination’
The statement comes a few days after Iranian President Hassan Rouhani told the Kuala Lumpur Summit that “the Islamic world should adopt measures to set itself free from the domination of America’s financial system and the US dollar”.
He suggested that Islamic-majority countries could support one another, for example, by signing new banking cooperation agreements and forming new financial mechanisms.
Earlier, he pledged that Iran will overcome US sanctions one way or another, either by bypassing them or through negotiations.
In mid-September, Iranian Central Bank (CBI) head Abdolnaser Hemmati said Tehran is planning to evade US economic sanctions by switching entirely away from the dollar to national currencies in mutual trade and by bypassing SWIFT, an international messaging network for communications between banks, which announced its ban on Iranian financial institutions soon after the US targeted them with sanctions in November 2018.
The network said that this was done in order to preserve the "global stability of the system" and that the decision was preceded by Washington threatening to impose sanctions on SWIFT itself if it would not cut ties with Iran.
US Sanctions Against Iran
The US reinstated strict sanctions against the Iranian economy’s energy, banking, and shipping sectors following Washington’s unilateral withdrawal from the 2015 Iran nuclear deal, also known as the Joint Comprehensive Plan of Action (JCPOA).
The White House also threatened to impose restrictive measures against any entity dealing with Iran, including EU member states.
The JCPOA lifted a raft of international sanctions against Tehran in exchange for the Islamic Republic limiting its nuclear programme, but was subsequently sabotaged under the Trump administration.