How Much Will a Deal Help Economy?
WASHINGTON (Dispatches) -- With only weeks to go until a November 24 deadline for a deal between Iran and the West over Tehran's nuclear program, Western investors have their fingers crossed, the Time magazine reported.
"If you just looked at the numbers, the deal revealed last week by the aerospace and defense giant Boeing seemed insignificant: $120,000, for some data, aircraft manuals and navigation charts. But symbolically, the sale to Iran Air, revealed on Oct. 22 was a big deal—the first time that an American aerospace company had done business with Iran since the U.S. began its sanctions there in 1979,” the publication said.
The Boeing sale, which was sanctioned by the U.S. Office of Foreign Assets Control under a temporary sanctions relief deal that began in January, is just one sign that Iran might soon be open for business with the West for the first time since the Islamic Revolution.
"As the clock ticks down towards November 24, the deadline for a deal between Iran and the West over Tehran’s nuclear program, both Iranian and Western business communities are hoping for a gold rush,” the magazine said.
Tehran throngs with Europeans jockeying for business, such as this winter’s planned visit to Iran of a hundred French executives, or the Italians, Chinese and Germans browsing the Tehran construction and mining trade show in August. Many international companies, from Samsung to Renault are already in Iran, trading in sectors permitted under the sanctions, such as food, cars and pharmaceuticals.
In 2013, EU countries made 5.4 billion Euros ($6.8 billion) worth of exports to Iran. Emerging market experts make breathless comparisons to Russia just after the Berlin Wall’s fall. "Iran,” said Charles Robertson, global chief economist at Renaissance Capital, "is the biggest opportunity of the next 10 years.”
"It’s easy to see why it could be. New markets of nearly 80 million people are rare indeed. Rarer still are emerging markets with oil and gas, educated work-forces and lively stock-markets — all humming with pent-up potential from Iran’s thirty-five years as an economic pariah,” the Time wrote.
Iranian boosters reject comparisons with Vietnam and Burma, other newly open economies. "We like to think of it as Turkey on steroids,” quipped an Iranian investor at the Europe-Iran Forum, a recent London conference that brought together European investors and Iranian businessmen.
But challenges remain. If the Forum was designed to showcase Iran’s possibilities, it also underscored the hurdles in tapping them. Few business conferences ban "negotiation, deal-making, or commercial transactions”, but this one did, mindful of the Obama’s promise to "come down like a ton of bricks” on anyone breaking sanctions, it said.
The former foreign ministers of Britain and France delivered speeches — even as the British Foreign Office reiterated to Reuters that its policy remained "not to encourage trade with Iran”. Sir Martin Sorrell, CEO of the world’s largest marketing group, WPP, gave the keynote — though some pro-Israel groups had petitioned him not to.
The effect on banks has undermined the idea that sanctions aren’t meant to hurt the Iranian people, the Time quoted one participant at the forum as saying.
In a speech last week, the U.S. chief negotiator Wendy Sherman urged Iran to "finish the job,” while U.S. officials say President Obama may try and bypass a vote on suspending sanctions in Congress, where support for the occupying regime of Israel is strongest, the New York Times recently reported. Congress, however, may not allow the President to bypass it.
"It’s the last large untapped market in the world,” says Ramin Rabii, of Iranian investment firm Turquoise Partners. "The future is very exciting.” The only question that remains — at least until November 24th — is whether all the hurdles can be overcome.
"If you just looked at the numbers, the deal revealed last week by the aerospace and defense giant Boeing seemed insignificant: $120,000, for some data, aircraft manuals and navigation charts. But symbolically, the sale to Iran Air, revealed on Oct. 22 was a big deal—the first time that an American aerospace company had done business with Iran since the U.S. began its sanctions there in 1979,” the publication said.
The Boeing sale, which was sanctioned by the U.S. Office of Foreign Assets Control under a temporary sanctions relief deal that began in January, is just one sign that Iran might soon be open for business with the West for the first time since the Islamic Revolution.
"As the clock ticks down towards November 24, the deadline for a deal between Iran and the West over Tehran’s nuclear program, both Iranian and Western business communities are hoping for a gold rush,” the magazine said.
Tehran throngs with Europeans jockeying for business, such as this winter’s planned visit to Iran of a hundred French executives, or the Italians, Chinese and Germans browsing the Tehran construction and mining trade show in August. Many international companies, from Samsung to Renault are already in Iran, trading in sectors permitted under the sanctions, such as food, cars and pharmaceuticals.
In 2013, EU countries made 5.4 billion Euros ($6.8 billion) worth of exports to Iran. Emerging market experts make breathless comparisons to Russia just after the Berlin Wall’s fall. "Iran,” said Charles Robertson, global chief economist at Renaissance Capital, "is the biggest opportunity of the next 10 years.”
"It’s easy to see why it could be. New markets of nearly 80 million people are rare indeed. Rarer still are emerging markets with oil and gas, educated work-forces and lively stock-markets — all humming with pent-up potential from Iran’s thirty-five years as an economic pariah,” the Time wrote.
Iranian boosters reject comparisons with Vietnam and Burma, other newly open economies. "We like to think of it as Turkey on steroids,” quipped an Iranian investor at the Europe-Iran Forum, a recent London conference that brought together European investors and Iranian businessmen.
But challenges remain. If the Forum was designed to showcase Iran’s possibilities, it also underscored the hurdles in tapping them. Few business conferences ban "negotiation, deal-making, or commercial transactions”, but this one did, mindful of the Obama’s promise to "come down like a ton of bricks” on anyone breaking sanctions, it said.
The former foreign ministers of Britain and France delivered speeches — even as the British Foreign Office reiterated to Reuters that its policy remained "not to encourage trade with Iran”. Sir Martin Sorrell, CEO of the world’s largest marketing group, WPP, gave the keynote — though some pro-Israel groups had petitioned him not to.
The effect on banks has undermined the idea that sanctions aren’t meant to hurt the Iranian people, the Time quoted one participant at the forum as saying.
In a speech last week, the U.S. chief negotiator Wendy Sherman urged Iran to "finish the job,” while U.S. officials say President Obama may try and bypass a vote on suspending sanctions in Congress, where support for the occupying regime of Israel is strongest, the New York Times recently reported. Congress, however, may not allow the President to bypass it.
"It’s the last large untapped market in the world,” says Ramin Rabii, of Iranian investment firm Turquoise Partners. "The future is very exciting.” The only question that remains — at least until November 24th — is whether all the hurdles can be overcome.