World  Business and Economic Analysis 

Read more ...

 Oxford Business Group reported that The lifting of trade sanctions and moves to open the Iranian economy to foreign direct investment have seen a number of international car manufacturers queue up to break into the country’s rapidly expanding automotive industry.

Iran’s automotive industry currently accounts for nearly 10% of the country’s GDP, the largest non-oil contributor, according to press reports.
JV to boost production

In late September France’s Renault announced it had finalised an agreement to create a joint venture (JV) with state-owned Industrial Development and Renovation Organisation of Iran (IDRO) to expand the company’s existing presence in the local market.

Under the terms of the JV, in which Renault has a majority stake, the car manufacturer will establish a new plant with an initial production capacity of 150,000 units per year, adding to its current 200,000-unit capacity in the country. The plant is expected to come on-line within two years, and Renault will also be authorised to set up its own distribution network, including sales and after-sales dealers.

Mohammad Reza Nematzadeh, minister of industry, mines and trade, said the deal was part of a broader government initiative to expand and strengthen the automotive industry’s product offerings.

“The Iranian government wants to attract foreign investment in the Iranian car industry to bring competitive new products benefitting Iranian customers with respect to standards, quality and safety,” Nematzadeh said when the agreement was signed.

For its part, Renault is looking to expand its footprint to become the third-largest producer in Iran – behind Iran Khodro (IKCO) and SAIPA, both subsidiaries of IDRO –according to a statement made to industry media by Bernard Cambier, senior vice-president and chairman of the Africa-Middle East-India region at Renault. Currently, Renault has cooperative deals with both firms for the production of Renault-designed passenger vehicles.
Citroën re-enters the market

The Renault deal comes as fellow French manufacturer Citroën looks to regain its position in the Iranian market, after pulling out of the country in 2012.

In early October Citroën’s parent company, Groupe PSA, signed a JV agreement with its former partner, SAIPA, to produce Citroën vehicles at a new plant in Kashan.

Under the 50:50 agreement, the partners will invest more than €300m in manufacturing and research and development capacity through to 2021, with production of three Citroën models to begin in 2018. Imports of Citroën vehicles will commence next year ahead of direct production.

SAIPA officials have said locally sourced parts and supplies will account for 35% of production when assembly begins, rising to 70% by 2020.

The French firms’ expansion plans drove up share values on the Tehran Stock Exchange’s automotive index in the first week of October, pushing the index up by 8.4%, contrasting with a 0.2% dip on the all-share board.
Queuing up

Manufacturers from further afield are also looking to establish a presence in the Iranian automotive industry.

During President Hassan Rouhani’s visit to Kuala Lumpur in early October, Malaysian Prime Minister Najib Razak said Malaysia was looking to boost economic cooperation between the two countries, with the automotive sector being one of the key areas targeted.

“Iran has imported 12,000 Proton Saga [cars] in the past and we hope to participate in the automotive industry, particularly as [a] supplier,” Najib said.

Germany is similarly eyeing a slice of Iran’s vehicle market. In early October Sigmar Gabriel, Germany’s vice chancellor and federal minister for economic affairs, and Ali Tayebnia, Iran’s minister of economic affairs and finance, signed a series of memoranda of understanding to boost economic cooperation across a number of sectors, including automotive, finance, energy and infrastructure.

While final details of what form the automotive cooperation will take have yet to be released, the agreement demonstrates Germany’s intent to challenge the rising presence of French brands already on the ground in Iran.

One German-owned brand that has already announced plans to begin exports to Iran is Volkswagen’s Czech manufacturer Skoda, with Bernhard Maier, CEO of Skoda, saying in late September that the firm was aiming to target sales in both Iran and South Korea.
Leading the way

The international interest is timely, with Iran seeing an upswing in production.

Last year domestic output stood at just under 885,000 passenger vehicles and around 97,500 commercial vehicles, according to the International Organisation of Motor Vehicle Manufacturers. While most of the production was geared towards meeting local demand, some units were exported, mainly to countries in the MENA region.

Production has accelerated further in the first half of this year, with nearly 580,000 vehicles – including 534,000 passenger cars and a mix of buses, pick-ups and trucks – rolling off assembly lines since March 20, the beginning of the Iranian calendar year, representing a 15.6% year-on-year increase, according to press reports.

The MENA market is expected to see strong growth over the next five years, with Iran set to be among the leaders in terms of expansion, according to PwC’s “2016 Auto Industry Trends” report. Demand in the Iranian market is expected to more than double to 2m vehicles by 2020, according to estimates made by industry stakeholders.

Issued in October, the report said that expansion in MENA will also help offset projected deceleration in some other established and developing markets, such as Russia, Brazil and the US.

 Read more ...

A new round of talks between Iran and UOP LLC Petroleum industry company of America has kicked off over investment and supply of new technologies.

Association of Petrochemical Industry Corporations (APIC) announced that a fresh round of negotiations has begun between Iran’s petrochemical officials and three major American and European petrochemical companies with the main axes of talks being construction of new polymer units, knowledge and technology transfer as well as issuance of license for new petchem plans.

On the sidelines of K Trade Fair 2016, the world's premier fair for the plastics and rubber industry in Germany, high ranking officials of Iran’s petrochemical industry held meetings with authorities of France’s Total and Air Liquide as well as America’s UOP, formerly known as Universal Oil Products.

The talks with UOP mainly revolved around supply of modern technologies to petchem industries especially in the field of propylene production, cooperation in methanol-to-olefins (MTO) technology as well as propane dehydrogenation (PDH) as a process step in the production of propylene from propane.

Presently, 80 per cent of propylene production is directly being converted to polypropylene since a centerpiece of the Sixth National Development Plan has been to uplift production capacity of propylene in order to feed petrochemical complementary industries.

Development of petrochemical industry in Iran also aims to increase production capacity of propylene and polypropylene to supply feed to petchem plants; accordingly, projects to convert methanol to polypropylene have been put on the agenda.

In addition to UOP, separate talks were also held with representatives of France’s Total oil company aiming to construct a polyethylene complex with new grades on the basis of modern technologies.

Undoubtedly, Total has been to most active European company in Iran’s oil, gas and petrochemical industries in the post-JCPOA era.

Also, Iranian officials at the German exhibition attended a meeting with representatives of Air Liquide Industrial gases company exchanging views on turning methanol to propylene and construction of industrial gases units in petchem industries.

Read more ...


International Ubar Mining  LLC, a newly established Omani company, has acquired a 70 per cent stake in an Iranian antimony mine.

The Sirzar mine is located at  125km south west of the Iranian city of Mashhad. It is owned by Mashhad-based Part Gowal Gity Co, which specializes in mining and trading of metal and non-metal minerals.

Part Gowal has been operating the open-cast mine since 2011 and recently commenced underground mining activities to increase production capacity.

The agreement was signed in Mashhad recently, according to a press statement issued by Ubar Mining.

Ahmed al Rawahi, executive chairman of Ubar, and Reza Nakhaei, managing director of Part Gowal, signed the agreement in the presence of Saud Ahmed al Barwani, Oman’s ambassador to Iran, and Ali Akbar Sibeveih, the outgoing Iranian ambassador to Oman.

Rawahi said the acquisition of the stake in the Sirzar mine is aligned to Ubar’s focus to unlock its intrinsic value for shareholders by increasing its portfolio through focused acquisitions. “We are committed to the responsible development of our assets and the environments in which we operate. One of our strategies is to support our government’s policy to create a mineral processing hub in the sultanate,” he said.

Antimony alloys are used in batteries, low friction metals, type metal and cable sheathing while its compounds are used to make flame-proofing materials, paints, ceramic enamels, glass and pottery, Muscat Daily reported.

China used to supply more than ninety per cent of the world’s antimony. It is anticipated that the demand for antimony oxide globally will increase with population growth, increased automotive production, and housing growth, the Ubar statement said.

Nakhaei said, “We are excited about the venture with Ubar.  They will be responsible for the initial exploration, investigative studies and detail structural and economic mapping to produce a proper mine plan and feasibility study to expedite mining and the beneficiation process.”

Ubar is a mining and mining technology company focusing on providing high-value partnerships that enable and facilitate integrated mining, geological and environmental engineering solutions.

Wiaan Basson, CEO of Ubar, said the company has concluded a number of strategic technology partnerships to ensure value added services to clients including beneficiation and technology transfer in the sultanate.

Ubar has also successfully tendered for the reclamation of copper and gold tailing dumps and mining waste in the sultanate. “We are currently in negotiations with other role players in Oman, the MENA region and Africa to expand the footprint of the company,” he added.

کتاب عملیات بانکی در عرصه بین الملل -سرفصل ها،ضمائم ،توصیه صاحب‏نظران ارزی و مدیران ارشد بانکی

Investment Consulting &Project Finance


Sign up for our newsletter