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I I r r a a n n E E c c o o n n o o m m y y U U p p d d a a t t e e
Issue 109/2016 – Monday October 10th Content
Passenger handling capacity of IKIA to change multifold in a decade
Norway opens $1 billion LC to facilitate trade with Iran
Rouhani in Bangkok: by developing its infrastructures, Iran is to become an international corridor and a hub in West Asia
Will updated US Treasury guideline ease Iran’s dollar transactions?
Passenger handling capacity of IKIA to change multifold in a decade
Ali Sabbaghi, a top adviser to the head of the Imam Khomeini Airport City told Shargh newspaper on Monday that efforts are being “seriously” made to develop the new Iranshahr Terminal—a key component of the Imam Khomeini International Airport city—that is projected to handle 20 million passengers annually, up from the current passenger handling capacity of 7.5 million. He said this project would require some $2 billion in
investment and a 10-year
timeframe has been projected for its completion. He says the project hopes to compete with successful airport-related developments and special zones in the UAE and Turkey.
Some $2.2bn investment is required to grow passenger handling capacity to 40 million yearly
Sabbaghi also talked about another development project
named ‘Salam’ in northwestern area of the airport for handling 3.5 million passengers a year, which is now 60 percent complete. He said this project had thus far been carried out with the backing of the government but has recently been awarded to the semi-state owned Bonyad Mostaz’afan (The
Oppressed Foundation) for completion. According to Sabbaghi, The foundation is supposed to make $100 in investment to complete the project in the next year.
Para-state Bonyad Mostaz’afan won a $100 million project to develop northwest of IKIA
In a report released on October 4th, the Wall Street Journal
published an update on the status of the two new terminals and a vast airport free-trade area called Imam Khomeini Airport City and the efforts Tehran has made to convince foreign companies to invest in these projects.
According to the website, French industrial
developer Bouygues and Aeroport s de Paris, which manages the Orly and Charles de Gaulle airports, already held talks this year with Iranian authorities about participating. Last year, French hotel giant AccorHotels signed a deal to manage Novotel and Ibis hotels connected to the existing airport, underlining international interest in airport-related
infrastructure.
In an interview with the WSJ, Sabbaghi has said Iran is going to gain its share of the market in a 15-year timeframe. He said Iran has hired Netherlands Airport Consultants, or NACO, which has worked on major airport projects in Mexico City, Kuala Lumpur and Beijing, as its main adviser. NACO estimates the new Iranshahr Terminal, with a capacity of 20 million passengers—will cost $2 billion. The WSJ also states that companies from South Korea, the Netherlands, France and China have signed deals or entered talks about joining the effort, some
2 with the backing of their
governments.
Korean, Dutch, Chinese and French companies already in talks for developing the Iranian international airport Norway opens $1 billion LC to facilitate trade with Iran Local Iranian media outlets reported on Sunday that a $1 billion worth line of credit has been opened by the Norwegian government to support export plans to Iran. According to Press TV, the news was announced during a meeting between Norway’s Foreign Minister Børge Brende and Iran’s Minister of Economic Affairs & Finance Ali Tayyebnia on the sidelines of the World Bank/IMF Annual Meeting 2016 in Washington. “Norway encourages its companies, banks and monetary institutions to launch cooperation with Iran,” said Brende. “An export credit line worth $1 billion has been allocated to Norwegian companies $400 million of which has been used to export advanced technologies to Iran,” the Norwegian official was quoted as saying by Press TV.
The daily Shargh quoted
Tayyebnia in his meeting with the Norwegian minister as saying that the two sides need to increase the level of their economic
cooperation by signing agreements such as avoiding double taxation as well as
agreements on customs and investment.
In a separate development and in an interview with Al-Monitor on October 7th in Washington,
Tayyebnia once again accused the US of not completely fulfilling its nuclear promises, and suggested Washington should do more to facilitate Iran’s return to the international financial system.
In comments on a panel with other ministers from oil producing countries, Tayyebnia said Iran’s approach to economics has always been described as one of
“resistance” to Western-led domination, but underscored that a more accurate translation is
“resilience”. “The main characteristic of a resilient economy is flexibility against external shocks,” he explained, according to Al-Monitor. “When there is a storm, a dry tree may break very easily, but a flexible tree can survive that storm.”
Economy minister describes what Economy of Resistance means
As part of the resistance economy policies, Tayyebnia said Iran is going to cut its budget
dependence on oil revenues to zero from the current level of 30%.
In an exclusive interview with Al- Monitor, Tayyebnia said Iran follows the advice of IMF whose staff recently visited Tehran and
released a preliminary report predicting an economic growth rate of 4.5% provided that the country implements some reforms. Tayyebnia said the 14%
differential between the official and market exchange rate will shrink further in the course of the next two months. He also ensured that Iran is implementing laws against money laundering and terrorism finance to improve international confidence in its banking sector. In line with this objective, he told Al-Monitor,
“Iranian banks have installed software to track suspicious transactions.” Tayyebnia also ensured fulfilling the action plan reached with the FATF.
Tayyebnia explains some measures Iran has so far taken to overhaul its economy
The minister said Iran has reached a “preliminary agreement” with South Korea to convert Korean won to euros. But he said the US could do more to facilitate Iran’s conversion of such currencies to euros by allowing tangential contact with the US dollar. “For small amounts, we are not facing any problem, but for big amounts, we are trying to resolve the issue,”
Tayebnia said. “We expect the US to take some concrete steps to resolve the problem.”
Rouhani in Bangkok: by
developing its infrastructures, Iran is to become an
3 international corridor and a
hub in West Asia
Speaking at the Asia Cooperation Dialogue (ACD) Summit on Monday, President Rouhani said
“Iran is eager to play an active role in Asian collaborations by
partaking in production, developing new markets &
providing secure energy.”
According to a twitter account run by President Rouhani’s office, Rouhani boasted that registering an annual economic growth rate of 8% is achievable because Iran is
“blessed” with a young &
educated work force, ample oil and gas reserves and a favorable geographic position. He said Iran invites Asian investors for
“mutually advantageous projects,”
and said investment in rail, air, and sea lanes assures Iran’s position as a major international corridor. “Developing its capacities and with an active role in Eurasian transport network, Iran is seeing to become a new hub in West Asia,” said Rouhani.
The Iranian president also assures availability of Iranian natural gas in this region saying “Through the expansion of its natural gas sector, Iran is ready to increase the
security of the energy supply in Asia.”
Rouhani: Iran ensures regional energy security
In the last leg of his South Eastern Asia tour, President Rouhani on Sunday met with Thai Prime
Minister Prayut Chan-o-cha before attending the ACD three-day summit. According to the daily Donyay-e Eghtesad, Rouhani told the Thai Prime Minister that this Eastern Asian country can play the role of a gateway for
strengthening Iran’s economic relations with the eastern Asian countries and for its part, Iran as the most secure and stable country in the region can be the best gateway for Thailand and Southeastern Asian countries to enter economies of the Central Asia, Caucasus and Europe.
Rouhani called for developing bilateral banking relations and added that the two countries should set up preferential tariff treatment in order to increase trade volume twofold. According to Donyay-e Eghtesad, the Iranian and Thai private sector
representatives engaged in face- to-face meeting on Saturday.
Iran and Thailand set to double annual trade volume
Will updated US Treasury guideline ease Iran’s dollar transactions?
On Friday, the US Treasury Department released updated guidelines that indicated Washington wouldn’t seek to sanction foreign companies doing business with blacklisted Iranian entities, provided they maintain only minority interests in
ventures, according to the Wall Street Journal.
“It is not necessarily sanctionable for a non-U.S. person to engage in transactions with an entity that is not on the [sanctions list] but that is minority owned, or that is controlled in whole or in part, by an Iranian or Iran-related person on the [list],” the guidelines say.
“Foreign financial institutions, including foreign-incorporated subsidiaries of U.S. financial institutions, may process
transactions denominated in U.S.
dollars or maintain U.S. dollar- denominated accounts that involve Iran or persons ordinarily resident in Iran,” the Treasury guideline guidelines say, according to the Wall Street Journal.
The Wall Street Journal deciphers this guideline, which has sparked criticism from Republican
lawmakers, and states that Treasury hereby clarifies that Tehran can legally gain access to dollars through non-U.S. banks and institutions, provided they have no direct contact with the U.S. financial system.
The Iranian economic daily, Donyay-e Eghtesad has termed the newly-released Treasury guideline as a “shortcut”
introduced by the Obama administration to bypass the existing dollar sanctions. Farda News, a conservative Iranian news website cites the guideline as the
“green light” of the US
administration to foreign banks for transactions with the Islamic
4 Republic. Hamidreza Asefi, an
Iranian moderate-minded diplomat and former spokesman of the Ministry of Foreign Affairs said this guideline is released under the pressure exerted by the EU and Eastern Asian countries on the US. According to Mehr News, He said this development will have scant impact on dollar
transactions but anyway Iran on the one hand should continue exerting pressures to show the EU how the US reneges, and
“extensively” and “seriously”
embolden ties with Russia, China and Eastern Asian countries on the other.
