Domestic Economy

Brits Get Ready for Trade

Brits Get Ready for Trade
Brits Get Ready for Trade

Chairman of the British-Iranian Chamber of Commerce, Norman Lamont has welcomed the reopening of the British Embassy in Iran and expressed hope that it will help improve economic relations between the two countries.

In an interview with IRNA on Sunday, Lamont said he expected the Joint Comprehensive Plan of Action to be ratified by the US Congress and the sanctions [imposed by the West over Iran’s nuclear program] to be lifted within six to nine months.

“If that happens, there will be a great increase in investment and trade which would benefit not only Britain but also Iran and this should lead to further improvement in bilateral relations,” he said.

British Foreign Secretary Philip Hammond arrived in Tehran on Sunday to reopen the UK’s Embassy in Iran four years after it was shut down. This is the first visit to Iran by a British foreign secretary since 2003.

Chairman of Iran Chamber of Commerce, Industries, Mines and Agriculture, Mohsen Jalalpour says Britain is writing a post-sanctions directive and revising the list of commodities whose export to Iran were banned under the sanctions regime. Meeting with the British Exchequer Secretary to the Treasury Damian Hinds, who was accompanying Hammond in his Iran visit, Jalalpour said on Monday that Britain could demonstrate its intentions to improve economic relations with Iran by consulting the Iranian side while drafting this document, Mehr News Agency reported.

“With a population of 80 million and influence in the 400-million-strong regional market, developed infrastructure and rich natural resources, Iran is an interesting trade partner for England,” he said.

Jalalpour invited British companies to invest in joint ventures in knowledge-based industries such as nanotechnology, information technology, pharmaceuticals, and environment in addition to the traditional sectors such as energy, petrochemicals, transportation and heavy industries.

The ICCIMA head urged British firms to choose their partners from the Iranian private sector, noting that the private sector will be the main driving force behind future development projects in view of the government’s tight infrastructure budget.

Hinds, for his part, noted that even with the sanctions still in place, holding talks between the two countries could help both sides find avenues for cooperation in the post-sanctions era.

The British official announced that a large economic delegation from England would visit Iran before the year’s end to see business opportunities in Iran.

  Banking Cooperation

Britain said on Sunday that it wanted to work with the Central Bank of Iran to make it easier for UK banks to finance trade and investment in the country after sanctions are lifted.

“I think it would be very helpful and very positive if we could begin a dialogue about how we can create conditions which would allow British banks and British financial institutions to engage in the financing of trade and investment in Iran,” Hammond told CBI governor Valiollah Seif at a meeting in Tehran.

“There is a huge appetite both on the part of our commercial and industrial businesses to engage with the opportunity of Iran opening up and there is huge appetite on the part of our financial institutions to support that activity but of course it has to be done in the proper way,” he added.

Speaking to reporters after the meeting with Hammond, Seif said two of the four Iranian banks in London, namely Bank Melli Iran and the Persian International Bank are prepared to resume activities as soon as the economic sanctions are lifted.

He, however, noted that the Iranian banks should upgrade their facilities to comply with international standards, in such areas as anti-money laundry regulations.

Saif also called for cooperation between the CBI and the Bank of England. Hammond said the Bank of England is an independent entity but promised to deliver Seif’s message to the relevant officials.

According to Saif, the top British diplomat also called for cooperation between the stock markets in Tehran and London.

  Oil Talks

Hammond also held talks with Oil Minister Bijan Zanganeh on Sunday to discuss resumption of cooperation in the oil sector.

The British foreign secretary was accompanied by a politico-economic delegation, including representatives of major British companies such as the Royal-Dutch Shell.

Before imposition of sanctions, Shell took part in the development of a number of Iranian oil fields, including the offshore Soroush and Norouz fields.

According to Iranian media, the company owes Iran €2.3 billion ($2.62 billion), whose payment has been stalled as a result of sanctions on Iran’s energy and financial sectors.

Iran, for its part, cooperated with Britain for the development of a gas field in the North Sea, but due to sanctions, the Islamic Republic has not been able to benefit from its cooperation.

Speaking on the sidelines of the meeting, Zanganeh emphasized that British companies should not view Iran as a mere consumer market, calling for investments and joint production plans in the Iranian oil sector.

The conclusion of a nuclear agreement between Iran and the P5+1 group of countries — the US, the UK, France, Russia, China and Germany – has raised hopes about resumption of economic cooperation between Iran and western countries.

Under the July 14 agreement, there will be limits to Iran’s nuclear activities in exchange for the removal of all economic and financial restrictions on the Islamic Republic.