Iran capitalises on sanctions removal with slew of deals with western businesses

[umbertino]

$10bn purchase of new planes from Airbus and return of Daimler truck business among first moves as analysts hail turning point for Iranian economy

 

 

Saeed Kamali Dehghan

 

Monday 18 January 2016 11.15 GMT

 

 

 

Western businesses are jockeying for investment opportunities in Iran as the country regains access to the global financial system following the lifting of sanctions at the weekend.

 

Russian investment firm Renaissance Capital has described Iran as “the last remaining sizeable global economy cut off from international capital to reopen”. The Iranian president, Hassan Rouhani, said on Sunday that 150 companies from 50 countries had recently visited Iran for investment.

 

Local media quoted Abbas Akhondi, the minister for roads and urban development, as saying that Iran had struck a deal with the French company Airbus for the purchase of 114 new planes, estimated to be worth more than $10bn (£7bn).

 

On Monday the German automotive firm Daimler said it had signed letters of understanding with local partners to return its truck business to Iran, six years after sanctions interrupted its activity. Iran has a huge car market and French manufacturers including Peugeot and Renault are also considering a comeback.

 

International business leaders mulling ways to sell their products in the Middle East’s second largest economy have already embarked on fact-finding missions. But the lifting of sanctions, which came into effect on Saturday after the implementation of last summer’s landmark nuclear deal, gives the business community the green light to exchange money. Iranian banks have also reconnected to the European financial system via Swift, which facilitates international transactions.

 

Germany, France and Italy are leading the pack as Europe aims to increase trade with Iran from the current level of €7.6bn (£5.8bn...$8.27B) to the pre-sanctions figure of almost €28bn ($30.48B)

 

In the short to medium term, China’s president, Xi Jinping, is to visit Tehran next week, and the British chancellor, George Osborne, and Germany’s economy minister, Sigmar Gabriel, are planning to take trade delegations to Iran in May. Rouhani is expected in Rome and Paris soon.

 

Ramin Rabii, chief executive of Turquoise Partners, which manages more than 90% of all existing foreign portfolio investment on the Tehran stock exchange (TSE), underlined Iran’s business potential.

 

“The implementation of the nuclear deal has brought about a new era for the Iranian economy and its investment potential,” he told the Guardian. “Iran has a young and sophisticated population, is rich in energy and mineral resources and has a well-diversified economy with a widespread industrial base. With the re-emergence of Iran and its reintegration into the global economy, Iran can potentially be the engine for regional and perhaps even global economic growth in the next five to 10 years.”

 

Esfandyar Batmanghelidj, founder of the Europe-Iran Forum business conferences series, was critical of those in the west predicting a “gold rush”. He said: “This misunderstands the real nature of the Iran opportunity, which is not so much about foreigners flocking to Iran to trade and invest, but about a new ability for Iranians to invest in their own economy … as they eye global markets.

 

“Historically, gold rushes are fleeting and exploitative. I think Iranians are hoping implementation day leads not to a gold rush but to a golden age, and it’s their efforts that will make it so.”

 

Rabii predicts the Iranian economy will grow at a rate of 6-8% in the coming years. “There has been a lot of media attention on the oil and gas sector but there is a lot more to the Iranian economy than the energy sector,” he said.

 

The petroleum sector constitutes only 15% of Iranian GDP and 30% of the government’s annual income. Iran is expected to immediately add half a million barrels per day to its crude exports, which will have an impact on plummeting prices and a global oil market already under pressure due to oversupply.

 

“It is hard to say how this deal will impact the average person’s pocket in the next month or even a year, but I can tell with confidence that this is potentially a turning point for the Iranian economy which will create value for Iran and will improve the quality of life of its citizens in the medium to long term,” Rabii said. “From an investment and business perspective, Iran is the market of the future. Iran may not be the best performing market of the next year, but I will bet my money that it will be the best performing market of the next decade.”

 

Alstom, the French electricity generation and rail transport company, is seeking contracts to work on the expansion of the metro in Tehran and building two more lines in the city of Mashhad, as well as participating in the electrification of the 600-mile (1,000km) Tehran-Mashhad railway. The French industrial group Bouygues and Aéroports de Paris are also in talks with Iran to construct the country’s largest transport project, the second terminal at Tehran’s Imam Khomeini international airport.

 

 

Tehran’s stock exchange.

Photograph: TIMA/Reuters

 

 

http://www.theguardian.com/world/2016/jan/18/iran-capitalises-on-sanctions-removal-with-slew-of-deals-with-western-businesses

[Zcountess]

AIRBUS PLANES ARE GARBAGE ...NOTHING LIKE BOEING...MY OPINION ...LOL

[SnowGlobe7]

Yup Boing was a part of the Tulsa economy...we miss them

[divemaster5734]

Yup Boing was a part of the Tulsa economy...we miss them

 

In an effort to show Boeing just how much they really care, a couple unions in Washington State have announced law suits to force Boeing to stay in the state.

They moved corporate HQ to Chicago a few years ago, and built a huge plant in South Carolina, where they wont be eaten alive by insane union demands.

It was the UAW that destroyed Detroit as the manufacturing capitol.

Unchecked and out of control unions are destroying America, one city, one state at a time.

[SnowGlobe7]

Union was one of the reasons they listed as leaving Oklahoma

Edited January 18, 2016 by SnowGlobe7