So the Iranian company ask their Iranian bank (Melli etc) to provide a guarantee to the Korean company that essentially means the bank pays if the Iranian company doesn’t. There are (were) banks in Korea who would take Iranian bank risk (indeed Melli Bank have (had?) a branch in Seoul).

So, as the sales rep rightly points out, if the company defaults, even if the Iranian bank wanted to make good on its guarantee, the effective lock-out of Iranian banks from the global financial system (just like for the Norks) makes it damn difficult for them to actually pay up. So the guarantees (bonds) are worth pretty much nothing.

And there’s no interest involved so it’s Islamic (although I think Islamic finance is more a Sunni thing than a Shia thing).

Makes more sense than there being some kind of liquid debt markets in Tehran…

Well, in the cinema verite that constitutes today’s “international community”, respect is what it’s all about, baby. You’ve got to get right in the face of those rogue empires with hand-held cameras (& maybe a few RPG’s) & let ‘em know what’s what.

So let’s hope the ROK’s take heed of what you say and send those f-ing Americans packing. To do otherwise would be most gauche. A triad of the ROK-DPRK-Islamic Republic of Iran Presidents, posed together arm in arm, would be the thing — wherein to catch the conscience of the world.

Not to mention the helpful effect it would likely have on the likelilhood of the Iranians paying off their own bonds. No reason why doing good shouldn’t also mean doing well.

“WASHINGTON, Oct. 28 (Xinhua) — There is no evidence that Iran is actively building nuclear weapons, said Mohamed ElBaradei, head of the International Atomic Energy Agency (IAEA), in an interview with CNN on Sunday.”