France’s State Bank to Fund Projects in Iran

Date: 24 September 2017 - 21:07

News ID: ۴۴۵۷۲

PARIS (Dispatches) -- Bpifrance, the country’s state investment bank, will finance investment projects of French companies in Iran from 2018, granting up to 500 million euros ($598 million) in annual credits, its CEO said in a newspaper interview on Sunday.
"Excluding a force majeure case, we will be on their side in early 2018. We are the only French bank that can do it without risking U.S. sanctions for a possible breach of remaining embargo rules,” Nicolas Dufourcq told Le Journal du Dimanche.
The deal Iran struck in 2015 with six major powers lifted many sanctions against the country in exchange for restrictions on its nuclear activities and paved the way for international business deals.
But many banks have stayed away for fear of inadvertently breaking remaining U.S. sanctions, which could lead to huge fines.
Because the BPI has no operations abroad, notably in the United States, it is not exposed to possible fines for U.S. sanctions breaches.
U.S. President Donald Trump has created new uncertainties over the U.S. stance towards the Iran nuclear agreement. Trump told reporters this week that he had made a decision on what to do about the agreement but would not say what he had decided.
Several Franco-Iranian deals were announced during Iran President Hassan Rouhani’s official visit to Paris in January last year. These included a joint venture between carmakers PSA Peugeot Citroen and Iran Khodro as well as plans for Iran to buy Airbus aircraft to update its ageing fleet.
There were also deals in the oil, shipping, health, agriculture and water sectors.
Last week, Iran broke the 15-year spell of not obtaining any finance from European banks by signing major deals with Austrian and Danish banks to secure funding for its development projects.
The first major finance deal worth €1 billion was signed on Thursday between Austria's Oberbank and a dozen Iranian banks. The Austrian bank thus became one of the first European financial institutions to break the ice in providing loans for Iranian projects following the removal of Western sanctions in early 2016.
Another finance contract was signed on Thursday, between the Iranian team and Denmark's Danske Bank which became the second European lender to ink such an agreement with Iran.
The deal is worth €500 million and sees 10 Iranian banks on the receiving end.
UK renewables investor Quercus also signed a deal worth over half a billion euros to build and operate a 600-megawatt (MW) solar farm in Iran, the company said on Wednesday.
Earlier, Norway’s Scatec Solar was reported to be in talks to generate 120 megawatts of solar power in Iran, which would rise to 500 MW later.
The Oslo-listed firm’s CEO Raymond Carlsen told Reuters that the initial project under discussion would cost $120 million per 100 MW installed.
In August, Iran secured an €8-billion credit line from South Korea's Eximbank — what was seen as the country's biggest loan deal since the removal of sanctions against it in early 2016.