Italy is poised to sign deals worth about €17 billion ($18.4 billion) with Iran during President Hassan Rouhani’s visit to Rome, which started on Monday, an Italian government source said.
The accords cover various sectors, including energy and steel, and underscore the potential business bonanza on offer for European firms following the lifting of western economic sanctions on Tehran earlier this month.
These included a deal for Italian oil services group Saipem for a 2,000-km pipeline worth between $4 billion and $5 billion, Reuters reported.
In addition, Italian steel firm Danieli will sign commercial agreements worth up to $5.7 billion with Iran, a company spokesman said. These accords will include a joint venture, to be called Persian Metallics, with other international investors, worth $2 billion.
President Rouhani arrived in Rome on Monday at the head of a delegation of more than 100 businessmen and ministers and was received by his Italian counterpart Sergio Mattarella. He was due to meet Italian Prime Minister Matteo Renzi and Pope Francis during his two-day stay before traveling to France on Wednesday.
The president is due to address a conference of entrepreneurs and industrial leaders in Rome on Tuesday.
The visit comes a week after the implementation of the nuclear deal between Iran and world powers, which saw economic sanctions against the Islamic Republic lifted.
Italy has traditionally had close economic ties with Tehran. It was Iran’s biggest trading partner in Europe before commercial ties plummeted as a result of sanctions. Since 2012, annual trade between the two countries has nosedived from €7 billion to €1.2 billion.
As much as 58% of Italy’s exports to Iran are in the mechanics sector, followed by chemical products at 8%.
“Italy is eager to develop long-term mutual cooperation with Iran rather than simply maintaining its presence in Iran’s consumer market,” said Italy’s economic development minister, Federica Guidi, a few months ago, adding that Italy seeks to regain its pre-sanctions stature in Iran.
Back in November, Italy’s deputy minister for economic development, Carlo Calenda, heading a 370-strong delegation, including representatives of 178 Italian companies, 20 associations and 12 banking groups, attended the Iran-Italy Business Forum in Tehran.
The event was one of the biggest trade conferences held in Iran in 2015. Among the companies represented were energy giant Enel, petroleum group Eni and cables manufacturer Prysmian.
While in France, President Rouhani is expected to sign a multibillion-dollar deal with planemaker Airbus Group SE for the purchase of 114 passenger planes. The purchase may include the double-decker A380 superjumbo jet as well as A320 family of aircraft, Iran Air Chairman and Managing Director Farhad Parvaresh said in an interview.
According to Iran’s Roads and Urban Development Minister Abbas Akhoundi, the first of the 114 aircraft intended for state-owned airline Iran Air are expected to be delivered before March 21.
If confirmed, a deal on that scale would be worth more than $20 billion at list prices, though Iran is sure to receive hefty discounts since its purchase includes a mixture of new jets and end-of-the-run models available for bargains.
French trade with Iran dropped from €4 billion ($4.5 billion) in 2004 to €500 million ($565 million) in 2013 as a result of sanctions.
The visits to Italy and France had been initially planned for last November, but were cancelled after the deadly militant attacks in Paris.
