Economy, Business And Markets

Hop, Air of Optimism at IranPlast 2014

Hop, Air of Optimism  at IranPlast 2014
Hop, Air of Optimism  at IranPlast 2014

Iran is still one of the most attractive markets for Europeans, from which they have been deprived due to sanctions, Financial Tribune learned during brief interviews with representatives of companies from Italy, Switzerland, Austria and Germany attending an international event in Tehran.

Nearly 250 companies from 13 countries have participated in IranPlast 2014, the 9th international exhibition on plastics, rubber, equipment, and machinery. Although Asian companies, and on top of them China, have showcased a strong presence in Pavilion No. 38 of Tehran international fairground, the participation of companies from major European countries, including Germany, the Netherlands, Italy, Spain, UK, France, Switzerland and Austria which were absent in the 2012 exhibition is a promising sign for the downstream petrochemical industry

Those who were interviewed considered the US-led sanctions as a "blessing" for the Asian companies which have not hesitated in recent years to fill in the western seat in the ever growing Iranian market.

"Not long ago, this exhibition stand (No. 38) used to be occupied by European manufacturers but sanctions replaced them with the Chinese who have now become so skilled at copying European products. Europeans may not be able to gain their initial market share back anytime soon," said an Iranian agent for a French machinery manufacturer who did not want to be identified. "Even the removal of sanctions may not loosen the grip of Chinese products on the Iranian market," he added.

Europeans Await Lifting of Sanctions  

Representatives of European manufacturers from Switzerland, Italy, Germany and Austria regard sanctions imposed on the Iranian banking system as the main barrier for trade with Tehran. Since 2012, the United States and the European Union have banned international financial transactions with Iranian banks over a long-running nuclear dispute.

The European participants in the fair said they believe businesses always "find a way to get around the barriers," though it may have adverse effects on the scale of their business.

"It is true that our trade with Iran has plunged to its record minimum after western sanctions were enforced on Iran, but we have come a long way here to remind the Iranian market of our products and that we will not hesitate to come back as soon as restrictions are eased. We are optimistic that this will happen in the near future," a businessman with the Swiss manufacturer Maillefer said.

Many businesspeople around the world are awaiting the results of the ongoing negotiations between Iran and the P5+1 group, which will end by November 24. The two sides have held several rounds of talks in the past year in a bid to reach a comprehensive deal that would lift sanctions on Iran and address international concerns on the country's nuclear program, which Tehran insists is entirely peaceful.

"This is the fourth time we are attending such an event in Iran as an association representing 170 Italian companies who cannot wait to revitalize their trade relations with Iran," Girolomo Dogostino, a member of the Italian Plastic and Rubber Processing Machinery and Moulds Manufacturers' Association said.

"We are here because the cooperation between Italian machinery manufacturers and Iranian counterparts is old, and we are big believers in the Iranian market. Almost all European companies were absent from the previous exhibition, but we were present and we decided this year to participate in the event again. We believe that Iran's international relations are improving and this will change the game. Europeans are losing their share in this market although some of them have already found a way to bypass restrictions," he added.

"It is interesting that although our 25-year-old trade with Iran has come to a halt due to sanctions and financial barriers, the market demand for our products is still high, and Iranians who have visited our booth at the exhibition expressed willingness to buy our products and replace them with the Chinese ones," said Andreas Boger from Weber, a German polymer processing machinery manufacturer. "We are looking forward to the outcome of nuclear negotiations."

Elsewhere in the exhibition, an Austrian sales manager for Africa and Middle East told Financial Tribune that in his country and probably in all Europe, "companies are very optimistic about the ongoing course of Iran-P5+1 nuclear negotiations."

Franz Weixbaumer said, "Every time there is a nuclear conference in Vienna, we pray for an agreement to be made… We believe our quality and service remains unrivalled in comparison with the Chinese products", Weixbaumer stated, while flashing a wide smile as a sign of hope and trust in the future.