Friday, 14 August, 2020

How the Nuclear Deal Could Boom Iran’s Economy

Following the nuclear deal between Iran and the P5+1 group, analysts and businessmen wonder how a potential lifting of the current sanctions will influence economic developments in Iran. There is no doubt that lifting of sanctions will pave the way for greater trade and investment ties between Iran and the rest of the world, especially the Western nations.

However, what exactly can we expect beyond a comprehensive deal?

Here are the few reports released at international media over the past 48 hours after the deal, showing how a historic deal could revive the Iranian economy:

U.S. and International Businesses Eye an Iranian ‘Gold Mine’ After Nuclear Deal

Iran has around $150 billion frozen in international banks, which when sanctions are lifted will begin filtering into the domestic and international economy.

In recent months, as the nuclear talks began to seem like they might succeed, American and European executives have rushed to Tehran to meet business people and to try position themselves to open operations there once sanctions end.

Immediately after Iran and Western leaders signed the nuclear deal on Tuesday, the French automaker Peugeot told the Wall Street Journal that the company was deep in talks with Iran Khodro, a local automaker, to start manufacturing cars in Iran.

Other industries are also eyeing major business — including hotels and aviation — in a country that in desperate need of overhauling almost every industry. More than one U.S. hotel chain has visited Tehran during the past few months, and found a wide-open market with huge pent-up demand.

Meanwhile, US business executives and investors say the potential in Iran is enormous. Among its population of about 77 million, Iran has a large number of well-educated, tech-savvy youth with close ties to relatives in places like Los Angeles and London, and a fervent desire to end their generation’s isolation.

Carmakers eye golden Iranian opportunity in wake of nuclear deal

After world powers reached a historic deal with Iran to limit nuclear activity in return for lifting sanctions, several international brands from Britain’s upmarket Bentley to volume manufacturers such as France’s PSA Peugeot Citroën are jostling to win lucrative business.

Among those looking to enter the once-closed economy is Lotus, the small British sports car maker, which has highlighted potential dealership locations. Bentley, the Volkswagen-owned luxury carmaker, is also studying the potential to open its first outlet in the country — possibly as soon as next year.

But industry insiders say the German and French volume manufacturers, which built up significant business in Iran before sanctions, will lead the charge into the country.

Iran is the biggest car market in the Middle East, selling 900,000 passenger units last year and building 1.1m.

Iran nuclear deal could revive trade in Persian rugs to U.S.

US carpet sellers looks forward to importing the rugs directly under terms of a nuclear agreement announced on Tuesday by Iran and six major world powers that, if approved, would allow new Persian rugs to again be exported to the United States.

“Nobody in the world can make hand-made carpets better than Persians. They have been doing it for thousands of years,” said Helmi, owner of Damoka carpet store in Los Angeles, who has been in the carpet business for nearly 40 years.

The American seller of rugs and furniture has been forced to nearly eliminate Persian rugs from their inventory by cycles of the United States imposing and lifting sanctions on Persian rugs since the 1980s.

During that time, India, China and Pakistan began producing rugs in the Persian style and exporting them to the United States.

When American sellers are able to resume imports of Persian carpets from Iran, they expects to have the opportunity to find products suited to modern American tastes.

Shell interested in exploring ways to do business in Iran

Oil major Shell said it was interested in doing business in Iran and was engaging with relevant governments to understand the impact of a nuclear deal reached between six major world powers and Iran.

“Strictly within the boundaries of the law, we are interested in exploring the role Shell can play in developing Iran’s energy potential,” a spokeswoman said.

The oil major said last month that some of its employees had recently met Iranian officials in Tehran.

Apple is reportedly in talks with Iranian distributors to start selling products there

Apple is in talks with Iranian distributors to potentially sell products in the country, The Wall Street Journal reports, citing people familiar with the matter.

However, Apple won’t be able to start selling iPhones and other products straight away. Iran actually has to implement the terms of the agreement before Western companies will be allowed in. The Wall Street Journal says that will be a long process that could stretch into 2016.

This isn’t the first time that Apple has thought about entering Iran. In 2014, WSJ reported that Apple was in touch with companies in Iran about launching there once sanctions are lifted. The Wall Street Journal said that senior Apple executives met with Iranian distributors in the company’s London office about a plan to launch Apple products in the country.

It’s unlikely that Apple is about to launch its own line of Apple Stores in Iran. Instead, it will probably choose to use resellers that only deal in Apple products. Apple can then take a cut of their profit, and it doesn’t run the risk of investing heavily in a country that could “snap back” into sanctions if it doesn’t keep to the terms of the agreement with the US.

China eyes trade, Silk Road projects with Iran as sanctions go

Buoyed by the historic nuclear deal reached between world powers and Iran, China is eyeing big openings for trade and the ambitious Silk Road projects with the Islamic Republic as the economic sanctions that isolated the country are set to go.

The deal struck between the six world powers the US, UK, France, China, Russia and Germany and Iran yesterday in Vienna will enable a revitalised sanction-free Iran to boost trade and cooperation with China, analysts said.

Don’t forget about the other black gold coming out of Iran

Now that the end of Iranian sanctions by the West are close at hand, the world is hungry for a piece of Iran. That goes for its oil sector, its military contracts, and also its caviar.

Caviar, the salt-cured eggs of the sturgeon fish, typically enjoyed cold with champagne or chilled vodka, traditionally hails from Iran’s corner of the world—the word “caviar” is of Persian origin. Thanks to its position on the the Caspian sea, Iran has been one of the world’s largest producers of the luxury foodstuff. A 30-gram tin of quality caviar retails for about $70—the finest can set you back closer to $150.

The deal Iran made with the global powers to cease developing nuclear weapons will end many of the economic sanctions arrayed against it, putting its caviar back on the global market. Even the US, which is not rolling back the majority of its trade sanctions, has a specific exception for caviar imports.


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