Economy, Business And Markets

US Firms Losing Iran Opportunities

US Firms Losing Iran Opportunities
US Firms Losing Iran Opportunities

With US-Iranian nuclear negotiations reaching their deadline this November, businesses around the world are waiting in nervous anticipation to re-engage with one of the world’s largest economies, Business Insider reports.

Even with heavy sanctions, Iran was the world’s 21st largest economy two years ago. The country is rich in high-demand natural resources, has an educated workforce, and increasingly well-developed processing and manufacturing capabilities.

“As soon as we suspend our major sanctions — which will happen very early in the agreement — the world will flood into Iran,” Wendy Sherman, the US’s chief negotiator, told Voice of America last week.

Iran has the world’s second-largest gas reserves, third-largest oil reserves, and significant rare earth deposits. The country’s 77 million consumers have been locked out of American and some European markets thanks to UN, EU, and US sanctions over Iran’s nuclear energy program.

But while international sanctions are relatively simple to lift through the UN and the European Union, American sanctions are more complex and politically sensitive, as lifting them will require cooperation from US Congress, which is often hostile to Iran, the report says.

“I see tremendous opportunities for American companies, but quite honestly European companies right now are stealing their lunch,” former Canadian Ambassador to the United Arab Emirates, Ken Lewis, told a group of Iranian Americans at a conference in Washington last week.

The former Canadian Ambassador compared Iran’s economic potential to Canada’s, given its mix of primary resources and human capital.

There are still challenges for US companies looking to Iran for business opportunities. For one thing, there are no direct banking relationships between Iranian and American banks.

Tehran is negotiating with the P5+1 – the US, Britain, France, China, Russia and Germany – to find a solution to a decade-long nuclear dispute. The two sides which hope to reach a comprehensive agreement by the November 24 deadline have already achieved an interim deal that has since January eased sanctions against Tehran in exchange for the Islamic Republic limiting some parts of its nuclear program.