Iran Elections Strengthen Trading Conditions

Following President Hassan Rouhani’s reelection this weekend, most people believe that Iran’s economy will be in a better position and the country open for international business, reads a commentary published by UK-based media outlet The Global Legal Post. Below is the full text:

On May 17, 2017, the US Administration upheld the Iran sanctions waiver, keeping the nuclear deal alive. However, despite the lifting of sanctions, difficulties still exist. Iranian companies and individuals, for example, are still unable to have a normal standard bank transfer with the UK-unlike some other European countries.

A degree of progress has been made on international larger deals-a major airplane deal was licensed and approved in the United States just before the end of Obama’s presidency with the first couple of airplanes now delivered to Iran and currently operating European flights.

Other international deals are under consideration-the United Wagon Company from Russia signed a €300 million deal in February to supply a total of 6,000 cars and will soon start supplying freight wagons to Iran.

The change of mood in the US, following Trump’s election and subsequent executive order, has undoubtedly put a dampener on the improved trading conditions.

However, one important factor to consider is that international treaties or conventions are between states/governments and not private individuals. In this case, President Rouhani and US ex-president Obama were not the only parties to the agreement on the Iran deal–it was an international agreement signed by France, Germany, the UK, Russia and the US.

The international treaties are legally binding and if every government went back on a treaty and decided to void it after the change of president, not only it would comprise a breach of international laws, but it would also create a crisis in the international community and impact the rule of law.

With the elections in Iran now over, there is every reason to hope that trading conditions will continue to improve and that the country is well and truly open for business.