New foreign investment projects ratified in Iran

13 November 2017 19:00 (UTC+04:00)

By Kamila Aliyeva

Iran aims to bring more international investors in the county after a long break when foreign investment in the republic was hindered by unfavorable regulations and international sanctions.

As many as 31 new foreign investment projects with overall amount of $712 million have been approved by Organization for Investment, Economic and Technical Assistance of Iran (OIETAI), Iranian media outlets reported.

“According to the sixth five-year national development plan (2016-2021), the Ministry of Finance and Economic Affairs and the Central Bank should attract $3 billion of foreign investments per year,” OIETAI Managing Director Mohammad Khazaei said on November 12.

Since the first tenure of Iranian President Hassan Rouhani in August 2013, $21.8 billion of foreign investments plans have been ratified, the official said.

Within this framework, $14 billion of investment has been attracted, he added.   

Iran, following the removal of a range of international sanctions linked to the implementation of the nuclear deal, known as JCPOA, has received credit lines and finance from different countries including India, Russia, South Korea, China, Austria, and Denmark, according to Khazaei.

The Iran nuclear deal was negotiated in July 2015 between Iran, the five permanent members of the United Nations Security Council and Germany. By ratifying the plan, Iran agreed to scale down its nuclear activities in exchange for sanctions relief.

Following this historic agreement, Iran became open to international business after almost a decade of economic isolation. Iran has concluded several agreements to attract foreign investments and loans from the world so far.

In this period, South Korea’s Exim Bank has agreed to allocate eight billion euros credit line to Iran. Several Chinese banks have also concluded a $35 billion financial deal with Iran, of which $10 billion account for China’s CITIC. Austria’s Oberbank became the first European bank to sign an investment deal with Iran worth of one billion euros. Denmark's Danske Bank signed a 500 million euro  contract with 10 Iranian banks in late September, thus becoming the second European lender to ink such an agreement with the republic.

These agreements stand among main economic achievements in the post-sanction era, Khazaei added. 

Moreover, relief from sanctions focused the attention of foreign investors on Iran’s huge potentials, especially in oil and gas sector. Iran had so far signed memorandums of understanding for 28 different projects with companies including Total, Eni and Shell, Russian firms Rosneft and Lukoil, and China's Sinopec and China National Petroleum (CNPC), etc. Moreover, this year’s deal between Iran and France’s TOTAL is noteworthy as it became the first one with a European oil company in more than a decade. Iran’s restored oil cooperation with Europe is only a piece of a series of deals concluded between EU states and Iran since the abolition of sanctions.

The country is capable to attract $3,500 billion worth of foreign investment in the next two decades due to its unique geopolitical and economic conditions, according to the Central Bank's official Valiollah Seif.

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Kamila Aliyeva is AzerNews’ staff journalist, follow her on Twitter: @Kami_Aliyeva

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