Domestic Economy

South Koreans Discuss Big Business in Tehran

South Koreans Discuss  Big Business in TehranSouth Koreans Discuss  Big Business in Tehran

South Korean Minister of Land, Infrastructure and Transport Yoo Il-ho arrived in Tehran on Saturday at the head of a 30-member business delegation and met with top officials to hunt out possible deals in the oil, gas and construction industries.

Officials of public and private companies are accompanying the Korean minister to Iran, once the sixth largest market in terms of orders won by South Korean builders before Seoul joined western sanctions against Tehran.

The South Korean minister met with Oil Minister Bijan Zanganeh on Sunday where they discussed cooperation between public and private companies in activities related to extraction of crude oil, liquefied natural gas and petrochemical projects, IRNA reported.

Insurance coverage for Iranian financed projects by South Korea's government insurance companies was also discussed; Zanganeh told a press conference following the meeting.  

As part of the meeting, Yoo expressed willingness to increase oil purchase from Iran after the lifting of sanctions.

"South Korea used to import an average of 180,000 barrels per day of Iranian crude before the sanctions were imposed, but imports have now been curtailed to about 100,000 barrels per day," said Zanganeh.

South Korea imposed economic sanctions against 126 Iranian companies and individuals in 2010 under growing pressure from Washington to join sanctions mandated by the United Nations Security Council over Iran's nuclear energy program.  

But the South Korean government is preparing for business with Iran after the sanctions imposed by the United States, the European Union and the United Nations are lifted, possibly by next year, as part of the nuclear deal reached between Iran and six world powers last month.

"We plan to highlight the capability of our firms for major projects with which the Iranian government seeks to rebuild infrastructure, diversify industries and develop energy fields in the post-sanctions era," South Korea's Ministry of Trade, Industry and Energy said in a statement on Sunday.

South Korean deputy trade minister Woo Tae-hee is also due to visit Tehran, accompanied by officials of his ministry and state-run oil, gas and resources firms. In the meantime, plans are underway for the visit of South Korea’s Foreign Minister Yun Byung-se in the near future.

> Transport and Infrastructure Cooperation

On Saturday, Yoo met with Minister of Roads and Urban Development Abbas Akhoundi to discuss cooperation in the areas of rail, air and transport.

"South Korea can cooperate with Iran through financing infrastructure projects and providing services for development of road and transport projects," Akhoundi told a press conference after the meeting.

In addition to boosting cooperation in transportation projects, Yoo said Korea is also willing to cooperate with Iran in housing and urban development, referring to his visit as the "first step for future collaboration."

> Hydropower Projects

The Korean official also met with Minister of Energy Hamid Chitchian on Saturday evening to discuss expanding cooperation in the power and water sectors.

Chitchian said cooperation with South Korea could be divided into two major categories. "One part of the joint activities will be based on transfer of technical knowhow and cooperation in research while the other is execution of projects by South Korean firms," he explained.

He invited Korean companies to participate in construction of dams, irrigation and drainage networks, hydropower projects, desalination systems, water and wastewater treatment and smart urban water networks in Iran.

Noting that South Korean companies can invest directly in the water and wastewater projects, Chitchain said: "The companies that bring both financing and technical knowhow have a better chance of winning the projects."

Yoo introduced the South Korean companies' representatives to the Iranian energy minister and expressed Seoul's interest in development of hydropower projects in Iran.

Representatives from Samsung Engineering Company, Hyundai Engineering and Construction Company and DOHWA Engineering Company were accompanying the South Korean official.

> Technical Cooperation

Speaking ahead of the South Korean delegations' visit to Iran on Saturday, head of the Iranian mission in Seoul, Hassan Taherian urged South Korean businesspeople to establish production lines for their products in Iran and engage in joint-ventures.

This draws on government policy of boosting technological cooperation with other countries.  

Trade between Iran and South Korea stood at $3.4 billion last Iranian year (ended March 20), of which $3 billion pertained to imports from South Korea.

Iran's major imports from South Korea include cars, home appliances, cell phones, auto parts and paper. Iran's exports include unsaturated isoprene, liquefied propane and butane, refined lead, bitumen and dried fruits.