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June 2017, No. 84


Trade & Business

Business France Office Opened in Tehran


Ayrault said development of France’s economic ties with Iran would benefit both countries, adding that Paris had never been so eager to expand relations with any other country. 


In the face of growing tensions resulting from what many see as the unfolding anti-Iran approach by US President Donald Trump, France used a late January visit to Tehran by its Foreign Minister Jean-Marc Ayrault to show its support for the expansion of economic relations with Iran.

Ayrault told a meeting of Iranian-French business leaders that last year’s nuclear deal with Iran had opened a new era that had already led to a major expansion of relations between the two countries.     

He said that protecting the Iran nuclear deal – the Joint Comprehensive Plan of Action (JCPOA) – was “extremely important” for Paris. 

The top French diplomat emphasized that it was the JCPOA that opened the way for France to move ahead with the expansion of its relations with Iran in all areas. 

Ayrault said development of France’s economic ties with Iran would benefit both countries, adding that Paris had never been so eager to expand relations with any other country. 

He further named the deals that Iran had already signed with companies Total, Renault and Airbus as examples of French determination to promote economic ties with the Islamic Republic.   

Nevertheless, Ayrault emphasized that the current banking hurdles remaining from the years that Iran was under sanctions still needed to be removed to further facilitate trade between Tehran and Paris. 

The remarks by the French foreign minister came on the heels of a controversial decision by President Trump to ban Iranian nationals from entering the U.S. 

The French foreign minister – who headed a delegation of 100 businesspeople in his Tehran trip - had further announced that Paris would double visas for Iranians in 2017 in what was seen as a response to the US ban against Iranians.   

“France wants to be able to allow a larger number of Iranians wishing to travel to France to ask for a visa in improved conditions,” he was quoted as saying.

“This project, which aims to double the number of visas currently issued for Iran, should take effect in the summer of 2017,” he said at the French ambassador’s residence in Tehran.

France has been issuing 41,000 visas a year to Iranian nationals. 

Threefold Jump in Trade


“France wants to be able to allow a larger number of Iranians wishing to travel to France to ask for a visa in improved conditions,” he was quoted as saying.


Iran’s Foreign Minister Mohammad Javad Zarif, speaking in the same business meeting, noted that trade between Iran and France following the implementation of the JCPOA has seen a threefold jump.

Zarif said bilateral trade in the 11 months of 2016 stood at €1.7 billion.

 “The two countries’ potential for economic cooperation is far more than that,” he said.

He added that the post-sanctions era has opened up new opportunities for both countries to have effective economic ties. 

“With the political developments in the United States and Europe, economic collaboration with other countries is facing numerous challenges. Yet, the Islamic Republic of Iran is all set to become a reliable trade partner for European countries, particularly France, based on mutual interests,” he said.

Zarif underlined the importance of partnership between the private sectors of the two countries. “Particular attention should be directed toward small- and medium-scale projects as well as major and large-scale projects,” he noted. 

“Cooperation with France is welcome in different sectors of oil and natural gas, petrochemicals, transportation, mining, science and technology, water and environment since these sectors are Iran’s priorities in the sixth five-year development plan (2016-21).”

The development plans offer a medium-term roadmap designed by the government and Majlis to help achieve sustainable growth, outlining strategies in its budget planning for the next five years. 

Long-Term Cooperation 

Ayrault said France has planned long-term cooperation with Iran in infrastructural projects, such as rail, ports, aviation and renewable energies.

“Development of bilateral economic ties is contingent on training young workforce, and French companies are ready to provide such training in modern agriculture, management of infrastructures, transportation and higher education,” he said.

Ayrault viewed the absence of human capital as a major obstacle to improvement of mutual ties and said, “Over the past months, 17 memorandums of understanding have been signed between the two countries’ universities, which are bound to have an effective impact on the quality of future economic interactions.”

He also viewed the opening of “Business France” office in Tehran as a sign of France’s determination to improve cooperation with Iran and said normalization of banking ties is being pursued by his government.

Paris opened the first major European trade office in Tehran back in September 2015 during the visit of a French delegation led by the Minister of State for Foreign Trade, Tourism and French Nationals Overseas Matthias Fekl and Minister of Agriculture, Food and Forestry and Government Spokesperson Stephane Le Foll.

The new Business France office, located at the country’s diplomatic mission in Tehran, seeks to facilitate commercial relations between the two countries.

Major French corporations, including plane maker Airbus, oil giant Total and automobile manufacturers Peugeot and Renault, have all signed deals with Iranian companies following the nuclear deal. 

“France has been quick in issuing export guarantees for Iran and this is an indication of trust we have in Iran. Iran, for its part, has to remove its financial obstacles for foreign investors to enter the market,” Ayrault said. 

Main Hurdle

“Currently, complications associated with money transfer and banking transactions are the main obstacle to commercial interactions between the two countries,” said President of Iran Chamber of Commerce, Industries, Mines and Agriculture, Gholamhossein Shafei, who was hosting the meeting. 

Shafei added that given the extensive experience and high-end technological development of French industries, companies of the two sides can forge alliances in fields such as infrastructure, construction, pharmaceuticals, medical equipment, transportation, environment and telecommunications.  

Five MOUs Inked

At the end of the meeting, five memorandums of understanding were signed between the two sides, including a cooperation document for development of Mashhad International Airport, two MoUs with Iran Fisheries Organization, one for the construction of a bioethanol factory in Kermanshah and another for sturgeon farming technology transfer.

 

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