Economy, Business And Markets

Italy Will Help Remove Banking Hurdles

Finance Desk
Italy Will Help Remove Banking Hurdles
Italy Will Help Remove Banking Hurdles

When it comes to ties with Europe, Iran has no better friend than Italy. The eurozone’s third-largest economy, in the words of Vincenzo Amendola, undersecretary of state for foreign affairs “has never left Iran and never plans to give up on it.”

In an interview with the Financial Tribune on the sidelines of the first edition of Iran-Italy Business Summit in Tehran, Amendola expressed the hope that the “cultural understanding” that permeates Iran-Italy ties, would help solve the existing challenges that the world faces, especially regional security concerns.

The interview coincided with the Iranian foreign minister’s trip to Vienna to attend a fresh round of Syria peace talks on Tuesday. The Italian official emphasized that Iran’s engagement in helping solve problems of the Middle East is indispensible. Regarding the bloodshed in Syria, to the mayhem in Yemen and the atrocities committed by the IS terror outfit in Iraq, Amendola said “everybody” is needed to bring an end to the persisting crises.          

“This trip was very fruitful. It is not my first trip to Iran as we have regular discussions and dialogue with our counterparts in the government, the foreign ministry in particular,” he said.

Referring to Staffan de Mistura, UN special envoy for Syria, who also happens to be Italian and his recent visit to Iraq, Amendola hoped the ongoing efforts will bear fruit.

UN Secretary-General Ban Ki-moon in January 2014, invited Iran to join the Syria peace talks, saying “Iran needs to be part of the solution to Syrian crisis.”

This invitation was later withdrawn due to objections by the Syrian opposition, as well as Saudi Arabia and the US. But all the parties have had to acquiesce to the idea of working with Iran despite the fact that it supports the rule of the embattled President Bashar al-Assad.

Amendola drew upon the historic ties between Iran and Italy that goes back 200 years, saying that his country kept up an active presence in Iran even during its isolation in the sanctions era.

Ties between the two countries have entered a new level, he said, when President Hassan Rouhani was elected in the summer of 2013. Rouhani’s campaign message centered on reviving the economy and ending the country’s international isolation after years of sanctions and mismanagement had taken a heavy toll.

Matteo Renzi, the 39 year-old center-left prime minister, who took office in February 2014, also came into office on promises to change Italy for the better.

 Financial Hurdles

Amendola reflected on Tehran’s concerns that after the landmark nuclear deal was signed with the six world powers last July, the latter had failed to live up to their promises of sanctions relief, particularly in the area of banking and finance.

However, he was optimistic that the anxiety of global lenders would eventually ease and the path will be paved for normal banking relations between Tehran and the outside world.

 “To the best of my knowledge, technical meetings are going in the Italian banking sector to support investment in Iran and the Europeans should move together. I hope to finalize some elements that will create the possibility for all economic sectors to ease the problems,” he said.

The senior Italian official noted that Rome has often demonstrated that it is willing to fulfill the [nuclear] deal terms, but the “problem lies with international regulations and the criteria that banks require…Italy will work with the Europeans to remove the problem.”

He emphasized that his “government has shown that it is serious in honoring its promises by funding Iranian projects, but for the private sector things should improve at the international level.”

Cassa Depositi e Prestiti, Italy’s state financing agency has announced that it will issue €4 billion in credit to Iranian public entities to help fund major infrastructure projects such as railroads and roadways.

Sace, Italy’s export credit agency, will support the transactions by providing €4 billion in guarantees for the deals and an additional €800 million in funding for Italian SME’s doing business with Iran.

Amendola said the US Secretary of State John Kerry’s meeting with European bankers last week was a positive step. “These kinds of meeting will help in overcoming some of the impediments.”

“I’m always optimistic. One or two years ago no one believed that the multilateral (nuclear) agreement with Iran would be possible.’’