Salman Faghigh Mirzaei
Western businesspeople and international traders are watching the likely removal of U.S. sanctions against Iran if a final nuclear deal is reached by the end of this June. Businesspeople have shown an interest in industries such as oil and gas, automobiles and technology. If the Iranian market opens, it is predicted to see a boom in international trade to and from Iran. Airliners and freight forwarders are now following the Iranian market more optimistically than before.
Why are U.S. businesspeople so eager to follow the final results of a nuclear deal? Why are some U.S. businesspeople optimistic about the opening of the Iranian market?
“Everybody loves us here,” said Ned Lamont, an American businessman and former politician who visited Iran on April 16th with a group of 22 other U.S. businesspeople. This was the first public meeting of businesspeople from the United States held in Iran since Iran’s 1979 revolution. The group included investors, consultants and entrepreneurs.
There were rumors that high ranking American business delegations from different industries have been traveling to Iran since last year, according to a Financial Times report. The April 16th meeting was the first time over the last three decades that business representatives from the United States gathered openly and seriously discussed the potentials of the Iranian market.
“There is no obstacle for cooperation of American and Iranian car makers,” said Mohsen Salehinia, Undersecretary of Iran’s Ministry of Industry. In addition, giants, such as Google and Apple, received legal permission to sell their products (software and hardware) in Iran (see also Why Google brought its app store to Iran, Global Trade Compliance (Apple), and Office of Foreign Assets Control – U.S. Department of Treasury.
Other attractive Iranian markets are oil and gas.  Chinese and Russian companies are the only international oil companies (IOCs) currently directly or indirectly involved with developing oil fields in Iran, as described in a U.S. Energy Information Administration report. Many U.S. firms operate in Iran’s oil Industry through a middleman and local front men to operate in the oil and banking businesses. While Russian and Chinese companies can operate freely, U.S. companies have been unable to take advantage of the opportunities in these industries, due to sanctions imposed by their own government.
In conclusion, with a population of 80 million and nearly a $14,000 GDP per capita (PPP), the Iranian market has the potential to grow regionally and internationally. It is undeniable that there are challenges with investing in Iran, even after lifting the sanctions, such as low rank economic transparency, less developed infrastructure as well as some legal restriction, which are being amended. However, the 18th largest economy of the world cannot be closed off for a long time. In comparison to a country like Cuba, which is also prohibited from trading with the United States, there are much more capabilities. Traditionally, private ownership and the concept of free market have deep roots in Iranian culture and law. If it is possible to trade with Cuba, definitely Iran would be a more profitable and diverse market.
 Iran holds the world’s fourth-largest proved crude oil reserves and the world’s second-largest natural gas reserves.
Salman Faghigh Mirzaei, M.A. International law, is currently a student at UCLA Extension in the International Trade and Commerce program.
The views expressed in this piece are solely those of the author and do not necessarily reflect the opinions of International Trade Examiner.
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