Economy, Domestic Economy

Oman Viable Replacement for UAE as Trade Partner

Oman Viable Replacement for UAE as Trade Partner
Oman Viable Replacement for UAE as Trade Partner

Iran can simply replace the UAE with Oman in foreign trade, thanks to the high potential of Iranian ports, said former president of Tehran Chamber of Commerce, Industries, Mines and Agriculture.

Yahya Al-e Es’haq was referring to the recent UAE decision to downgrade its relations with Iran, amid tensions between Tehran and Riyadh, following Saudi Arabia’s execution of top Shia cleric Sheikh Nimr al-Nimr earlier in January.

“Iran’s economy will remain unfazed in the event of slowdown in economic exchanges with few countries,” Mehr News Agency quoted Al-e Es’haq as saying.

Last week, the Iranian government banned all imports from Saudi Arabia, after Riyadh halted diplomatic and trade ties as well as air traffic with Tehran. The Saudi move, in turn, came after a group of angry Iranians broke into the Saudi Embassy in Tehran and its consulate in Mashhad, in protest at Nimr’s execution.

A group of Saudi allies, including Bahrain, Sudan, Djibouti and Somalia, followed suit and broke off diplomatic ties with Iran, while the UAE downgraded its relations and Kuwait and Qatar recalled their envoys.

During the sanctions, the Omani exclave of Musandam, which is separated from the rest of Oman by the UAE and extends out into the Strait of Hormuz–only an hour from Iran by speedboat–served as a link to the wider economy, with nearly 200 companies in Musandam conducting business exclusively with Iran.

Moreover, to strengthen trade and tourism relations with Oman, the Qeshm-Khasab shipping lane will open by Jan. 20, IRNA quoted Managing Director of Qeshm Free Zone Organization Hamid Reza Momeni as saying.

Khasab is a city of Oman bordering the UAE and the local capital of Musandam Peninsula. 

Qeshm is a southern Iranian island in the Strait of Hormuz.

With the Oman-Iran Trade Exhibition set to open on January 19 in Khasab, Oman aims to lure Iranian businesses and foreign investment. Omani officials see the three-day event, which aims to promote their products in the Iranian market and explore partnerships with Iran, as an opportunity to introduce Iranian investors to tourism in their country and encourage investment in the sector.

Iran will also hold an exclusive trade exhibition in Oman’s capital Muscat on January 26-30. The event is aimed at increasing cooperation with Oman’s businesses to boost the share of Iranian companies in the Persian Gulf state’s market and promote Iranian exports, according to Trade Promotion Organization of Iran.

IRNA quoted Seyyed Ali Etedali, executive manager of the exhibition, as saying on Sunday that the exhibition provides Iranian businesses with investment, trade and manufacturing opportunities in consumer goods, banking, insurance, technical and engineering services, in addition to tourism and handicraft sectors.

Last year’s exports of commodities worth $300 million against imports worth $71 million tipped the trade balance with Oman in favor of Iran. Steel and livestock topped the list of exports to the Arab country, with which Iran has long maintained close and friendly ties.

The UAE has for years been one of Iran’s biggest trade partners. The two countries have promoted their economic ties in recent years amid western sanctions, with the UAE acting as a center for reexporting goods to Iran, which indicates Abu Dhabi’s interest in not cutting all its ties with Tehran.

Figures show that Emirati exports to Iran stood at $12.24 billion and its imports from Iran reached $4.06 billion last year.

The eight-month data reveal exports of $3.4 billion and imports of $6.78 billion to and from the Arab neighbor.