Ebrahim Sheibani told the ISNA students' news agency on Friday: "We transfer foreign reserves to wherever we see as expedient. On this issue, we have started transferring. We are doing that."

ISNA specifically asked whether the money was being moved to Asian accounts but Sheibani's answer sidestepped the issue.

Sheibani told reporters earlier this week that Iran stood ready to repatriate the money it held abroad should this prove necessary.

Iran, which could face UN economic sanctions over its atomic programme, has bitter memories of its US assets being frozen shortly after the 1979 Islamic revolution.

Shift to Asia

ISNA's question appeared to be based on an article in the London-based Asharq al-Awsat Arabic newspaper that said Iran's Supreme National Security Council had ordered foreign holdings to be shifted to Asia.

Iran is the fourth biggest oil exporter in the world and the second largest in OPEC. Eighty percent of its export earnings come from oil, the price of which has soared over the past two years.

"If you're talking in terms of a safe haven proposal, that's where Switzerland is very strong, stronger than Singapore or other places. We are a country that is non-judgmental"

Steve Bernard,
Geneva Financial Centre, Zurich

Economists estimate Iran will have earned more than $40 billion in oil revenues by the end of the year to March 2006. Of this, $16 billion goes straight to budgeted government spending.

The rest goes to the Central Bank of Iran which keeps an unknown amount of holdings in foreign accounts.

The Naftiran Intertrade Company (NICO), the powerful trade and financing arm of the National Iranian Oil Company, is based in Switzerland.

Swiss reaction

Meanwhile a leading financial industry representative in Zurich on Friday said Swiss banks would welcome asset transfers by Iran.

 

"If you're talking in terms of a safe haven proposal, that's where Switzerland is very strong, stronger than Singapore or other places. We are a country that is non-judgmental," said Steve Bernard, director of the Geneva Financial Centre, a lobby in Switzerland's second-largest banking city after Zurich.

 

Switzerland is home to more offshore wealth than any other country, and is a traditional haven for investors who seek the safety of Swiss political neutrality and legal guarantees of banking privacy.

 

"Because of its non-discriminatory practices, Switzerland has always been an attractive place and would remain an attractive proposal for Iranian authorities looking to shift some of their assets or to diversify the geographical distribution of some of their assets," Bernard said.