Economy, Business And Markets

Italy Extends $3.3b Credit Line to Iran

Italy Extends $3.3b  Credit Line to Iran Italy Extends $3.3b  Credit Line to Iran

In the race to tap Iran's economic opportunities, Germany was the first, but Italy is securing deals to reenforce its foothold in Iran, perhaps looking to displace Germany as Iran's foremost European trade partner.  

Italy has agreed to a €3 billion ($3.3 billion) credit line for Iran, following several meetings this week between senior Iranian and Italian officials in Tehran, Iranian media reported.

Federica Guidi, Italy’s minister of economic development, told reporters after a meeting with the Iranian oil minister that Italy has agreed to lend Iran a €3 billion line of credit, according to reports by Iran’s state media.

The rush to conduct business with Iran comes on the heels of a recently signed nuclear accord that will remove economic sanctions on the country and permit international corporations and governments to pursue lucrative deals with the Islamic Republic.

The Italian insurance company SACE has also signed an agreement with the Central Bank of Iran, which had for years been blacklisted as a result of sanctions. Italian insurer Servizi Assicurativi del Commercio Estero signed the deal with Iranian authorities.

The aim of the agreement was "to facilitate future economic and commercial relations between the two countries," the statement said.

The Italian foreign minister and the chief executive of the Italian energy company Eni were also present in Tehran this week for meetings. Eni reportedly construct petrochemical units for Iran.

Trade between Italy and Iran is booming, according to Iranian officials.

“The Iran-Italy trade level is above normal, and the two countries are planning balanced and long-term mutual economic relations,” Iranian Foreign Minister Mohammad Javad Zarif was quoted as saying earlier this week following a meeting with his Italian counterpart.

Iranian officials estimate the level of trade between the two nations to be about $1.5 billion. They intend to double that figure in the near future.

Senior government ministers from France, Germany and Serbia have also been among visitors to Iran since the July 14 nuclear accord, which raised the prospect of banking and trade sanctions being lifted, perhaps around the end of this fiscal year.