Iran welcomes boosting trade ties with the European Union in a way that European investors could take advantage of unique opportunities in Iran and Iran’s economy could accelerate the process of its growth and development, according to Central Bank of Iran (CBI) Governor Valiollah Seif.
Seif made the remarks in “The 2nd Business and Banking Forum Iran Europe” which kicked off in Tehran on Saturday and will run until Monday.
In January world powers led by the United States and the European Union lifted sanctions on Iran which had been imposed over its nuclear program. The subsequent leap in Tehran’s stock market in late January and early February gave a hint of the country’s investment potential.
The lifting of sanctions opens a new chapter of economic development and put the country’s potentialities into practice, Seif added.
The ground is laid for more security of foreign investment in the country and also for more economic sustainability, he maintained.
Iranian economy enjoys great advantages such as educated and expert manpower, huge natural resources, cheap price of energy, big market inside the country and also access to the regional markets, the official highlighted.
“I hereby invite all European investors, service institutes and also banks to take the advantage of unique opportunities created in Iran in the post-sanctions time”, the CBI’s governor stated.
He also said that all Iranian banks are now connected to the SWIFT international payment system.
---- 2016 economic growth above 5 percent
Elsewhere in his remarks, Seif said that Iran’s economy is expected to witness an economic growth of more than five percent in 2016.
“Economic growth slowed down in 2015 but domestic and international predictions both indicate that growth in 2016 would be beyond 5 percent,” he added.
*** European banks should avoid conservatism
Addressing the same forum, Mohammad Khazaei, the Iranian deputy economy minister and also the president of the Organization for Investment, Economic, and Technical Assistance of Iran, said: “Let me be honest with you, I see some conservative approaches from European banks to work with Iranian banks. I would like to make it clear here that conservatism is the big enemy of taking advantages in Iran’s market.”
Banks are the routes of collaboration, transferring money, so any problem in this area of course is a big obstacle in the way of cooperation, the official stated.
He went on to say: ”Because Iranian banking system and Iranian businessmen have been away from their traditional counterparts [during the sanctions times]; therefore we need to get together again and know how the banks can get together and there are many issues that we should solve and then we can also move.”
Elsewhere in his remarks, Khazaei said Iranian government has adopted policies to support foreign investment especially in the fields which bring value added, such as transfer of technology and increase of exports.
He mentioned facilitation of investment making through cutting some administrative and trade barriers as one of the mentioned policies.
Iran will take the same approach toward the foreign investors as that towards the Iranian ones; the official stated, adding: “Based on the law, your investment in banking sector in Iran is protected and guaranteed by the laws, so there is no impediment or problem to work in this area.”
The foreign banks and investors will be granted tax exemption of 20 percent in the mainland and 100 percent in the FTZs of Iran, he announced.
*** ‘New, big opportunities in Iran by sanctions removal’
Matthias Machnig, the state secretary at Germany’s Federal Ministry for Economic Affairs and Energy, was the other speaker in the forum.
He said: “Now by lifting of sanctions there are new and big opportunities. It is very crucial that in these conferences we talk together to build up trust. I hope this conference will build up new relations and we will be able to define projects where we can work together and can build new basis for our economic and political relations.”
“We want your country being a constructive partner, not only in this region, but also in the international level and hopefully we are able to take this opportunity and find new ground for a common work together”, he added.
European and Iranian companies now want to take advantage of the resulting opportunity as quickly as possible, Machnig said; adding there are a lot of opportunities for long-term partnership which can benefit both sides.
*** Views of some foreign participants
One of the participants in the forum, Sonke Reimers, the managing director of Germany’s dfv media group, told the Tehran Times: “I think it is a very important forum, to bring together the experts from banking industry.”
Referring to the sanctions removal, he said: “I think it’s the time to come back to the table.”
“The world has changed since the sanctions were put in place, so there are a lot of technical and other issues we should understand. We should understand what’s going on in Iran and I think you should understand what’s going on in Europe”, he stated.
“We had a huge financial crisis in Europe and since then regulations came in place which are even worse than sanctions, so the world of banking and finance is very different if you come to Europe now, from before the sanctions”, he added.
“There are many opportunities and now it’s the time to take the opportunities. There are regulations in Iran that the German companies should know”, said Michael R. Fausel from Beiten Burkhardt, a commercial law practice founded in Germany and active worldwide.
“The conference shows that Iran is open for business, is keen to reconnect to the global banking and financial system. I think this conference is very positive for Iran and also more importantly very positive for Europe and the rest of world”, said William Breeze, an energy finance expert in Britain’s Herbert Smith Freehills, one of the world’s leading law firms.
“The reason for taking a conservative approach toward cooperating with Iranian banks is that European banks are concern about what America would think. I Think and hope that European banks can seek quite what a large opportunity Iran offers and realize that it’s an opportunity that we take and European banks should reengage as quickly as possible”, he noted.
“The forum is important for passing information, for being able to bring together the global institutions and Iranian institutions, so we understand how we can work closely together”, said Charles Blackmore , the CEO of Britain’s Audere International Ltd.
He said: “European banks are conservative because the primary sanctions are still in place. They have been fined many times by the Americans and they are nervous, they want to know, make sure that who they are working with. When they know who they are working with, then they can upset the American sanctions and they will be more relax about releasing money. But also you got to remember that Iran is one country of the whole world and there are many opportunities for finance, so we must evaluate the risks.”
CAP: Central Bank of Iran Governor Valiollah Seif speaking in “The 2nd Business and Banking Forum Iran Europe” in Tehran on Saturday
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