But US banking sanctions are also beginning to bite, industry sources say.
Iranian businesses “have not had any problem with local banks because we are considered UAE companies” under local rules requiring at least 51 per cent of a business to be owned by an Emirati national, said Nasser Hashempour, executive deputy president of the Dubai-based Iranian Business Council.
The same goes for fully Iranian-owned firms operating out of free zones “because they are registered in the UAE and their sponsor is the free zone,” which would withdraw their licence if they flouted the rules, he told.
Similarly, foreign banks with branches in the UAE continue to deal with firms that have Iranian partners, “but they are more cautious — they scrutinise them more when extending facilities,” Hashempour said.
However UAE-based branches of international banks have “asked most Iranian individuals who have personal accounts with them to close their accounts,” he added.
A fourth Iranian bank, state-owned Sepah, is under UN sanctions stipulating a voluntary freeze by member states of its overseas assets, part of two sets of UN sanctions largely targeting Iran’s nuclear and ballistic missile drives.
US President George W. Bush accused Iran of being “the world’s leading state sponsor of terror” when he visited the UAE in January.
The oil-rich UAE is a US ally and has a long-standing territorial dispute with the Islamic republic. But it also has wide-ranging links with its neighbour across the strategic Strait of Hormuz, with booming Dubai serving as the lung through which Iran breathes as Washington tightens the economic noose.
There are an estimated 450,000 Iranians living in the UAE out of a total population of more than 4.1 million. About 10,000 Iranian firms operate in the country, chiefly Dubai, according to Iranian figures.
Iranian embassy statistics put bilateral trade at 11.7 billion dollars in the Iranian year ending in March 2007, with imports from the UAE forming the bulk of the exchanges at 9.2 billion dollars.
The embassy expects bilateral trade to rise to about 14 billion dollars by the end of the current Iranian year next month.
UAE figures corroborate this projection. According to the Dubai Chamber of Commerce and Industry Iran was the largest market for its members last year, with non-oil exports totalling a massive 9.8 billion dollars — a 33.4 per cent increase on 7.3 billion dollars in exports in 2006.
