Germany Reports Surge in Exports to Iran

Date: 22 August 2016 - 22:11

News ID: ۳۰۳۵۹

BERLIN (Dispatches) -- German exports to Iran, mostly machines and equipment, jumped in the first half of the year following the removal of sanctions against the Islamic Republic, official trade data showed on Monday.
Exports to Iran surged by 15% year-on-year in the first six months of 2016 to 1.13 billion euros ($1.3 billion), the Federal Statistics Office said.
This compares with a rise of 1.4% in overall German exports in the same period and a fall of 14% in German exports to Iran in 2015.
"There is a huge demand in Iran for plant and equipment", said Michael Tockuss, head of the German-Iranian Chamber of Commerce, adding that chemical products and electrical engineering were also doing well.
"And there is growing demand for technology from the renewable energy sector, mainly wind power stations," Tockuss said, adding that the reluctance of banks to finance bigger deals between German and Iranian businesses was slowly eroding.
Tockuss said exports to Iran would further pick up in the coming months and are expected to rise by as much as 25% in the whole of 2016 and by 30% in 2017.
"The sanctions against Iran were built up over several years and it now will take some years to reverse them and establish new business ties," he said.
The head of Germany's BGA trade association has said exports will grow less than expected this year due to external risks, including Britain's vote to leave the European Union and uncertainties ahead of elections in the United States and France.

Iran to Use New Oil Contract
Iran’s Vice-President Eshaq Jahangiri has told the oil and finance ministries to start using the approved new draft for the Iran Petroleum Contract (IPC) for oil and gas deals, the Oil Ministry’s news agency Shana reported on Monday.
The launch of the IPC has been postponed several times as critics of President Hassan Rouhani have drawn parallels with Iran’s oil concessions to the UK under the 1901 D'Arcy Agreement which Iranians believe squandered their national wealth.
Minister of Petroleum Bijan Zangeneh attended a parliamentary session on Sunday to answer criticisms of the IPC. He said last week the IPC would need minor amendments but that implementation of its final draft would not need the approval of parliament.
Shana published the general terms and conditions of the IPC, specifying that the new contracts are divided into three main categories: exploration, development of discovered fields that would lead to production, and enhanced oil recovery (EOR) to increase output.
The Ministry of Petroleum is allowed to sign contracts up to 20 years from the start of development. This period can be extended for five years if EOR techniques are applied on a field.
A contract’s fees will be paid in cash or as a share of output.
Only Iranian exploration and production companies whose credibility has been approved by the National Iranian Oil Company (NIOC) can partner with foreign oil companies.
NIOC is allowed to sign buy-back contracts for the development of discovered but undeveloped fields, after receiving case-by-case approval from the oil minister.
According to the IPC, the second party would bear all costs and risks of exploration and production. The government, the Central Bank of Iran or any of the state banks will not guarantee any of the commitments in the contract.