The 4th Europe-Iran Forum on the 3rd and 4th of October in Zurich will gather the highest level of speakers and attendees of any Iran conference to date. In an exclusive interview with finews.asia, Esfandyar Batmanghelidj points out the importance of this event for Europe's business community.
Esfandyar Batmanghelidj, what was the initial intention to organize this forum?
The Europe-Iran Forum (EIF) was established four years ago to help support business diplomacy between Iran and the West. Many of the complex challenges facing Iran involve both political and economic considerations, and so they cannot be solved by policymakers or business leaders working separately.
Cooperation is needed among the full range of stakeholders, and the Forum is designed to help support more dialogue, information sharing, and relationship building within the network of business leaders and policymakers working on Iran today.
«Switzerland's trade with Iran has rebounded since the lifting of international sanctions»
Switzerland has been an excellent venue not only because of its strong diplomatic and economic relations with Iran, but also because of its central geographic location and reputation as a location of leading international summits.
At what stage are the economic and business ties between Switzerland and Iran?
Switzerland's trade with Iran has rebounded since the lifting of international sanctions, and many Swiss companies have substantial operations in Iran, particularly in fast moving consumer goods, pharmaceuticals, and commodities trading.
«Iran's has not yet built its future»
Even some medium-sized Swiss banks have begun to process transactions from Iran on behalf of their most important clients. There remains a great potential for further trade and investment, particularly among private sector firms and SMEs in both countries.
After several multilateral agreements have been reached in the recent past, many European companies are evaluating investments in Iran. What is the result of this so far?
Over the last two years, every sector in Iran has seen new partnerships established between foreign and local firms. These partnerships have not yet made Iran a total economic success story, but they are the all-important case studies, proving to the wider sector that deals can be made and projects can be delivered in Iran.
Iran's has not yet built its future, but it has devised a blueprint and it is laying the foundation. This itself is a significant achievement.
What kind of deals have the biggest priority?
From the perspective of Iran's near-term economic growth, major energy deals such as Total's recent gas contract and major industrial joint-ventures such as Renault's deal with IDRO, will be the most important to build investor confidence.
«There is no doubt that Iran is a complicated country in which to do business»
But in the medium to long-term, Iran will need to find momentum in a wider range of sectors, particularly those that are more private sector dominated and consumer focused. This is where most of the much needed job creation will come.
Why is it so difficult to move beyond the level of MOUs?
There is no doubt that Iran is a complicated country in which to do business. Each commercial agreement must be subject to a high level of due diligence and there are risks that must be mitigated. The flurry of MOUs have made it clear that many companies can see real commercial opportunity in Iran. Getting to a final contract requires companies to intelligently structure both their operations in Iran and their financing solution. This remains challenging.
The good news is that this summer several major agreements were concluded that demonstrate companies moving from MOUs to full contracts-- these include deals by Total, Renault, Alstom, Toyo Engineering, SK E&C, and Boeing among other companies. These deals will set an example for others to follow.
How would you describe the political forces driving Iran right now?
The business community has been buoyed by President Hassan Rouhani's reelection in May of this year. The need to spur economic growth and create jobs is the key driver in Iranian politics today. Encouragingly, there is broad political consensus in Iran that foreign trade and investment is necessary for growth and economic development. We see more political willingness to reform key laws and policies in order to create better conditions for foreign investors.
«Iran's bankers deserve credit»
Rouhani's recently appointed cabinet includes well-respected technocrats, and keeps in place three key figures: Foreign Minister Javad Zarif, Oil Minister Bijan Zanganeh, and Central Bank Governor Valliollah Seif. These individuals and their colleagues should be able to work closely with Iranian and foreign business leaders to pursue a strong economic agenda.
There is a strong will and need in Iran to reform the financial sector. In which phase is this development?
Iran has made good progress in its complicated process of financial reform. Early this summer, the Financial Action Task Force (FATF) chose to continue to suspend Iran's position on its «black-list». Recognizing that Iran was accepting technical assistance in the reform process, the FATF elected to make this suspension indefinite, giving Iran more time to work with banks, regulators, and external advisors to establish international best-practices.
The process remains in its early phase, but Iran's bankers deserve credit for their determination to regain their place in the international financial system.
The key factor in Iran's further development seems to be the U.S. Administration’s Middle East policy. What is our opinion?
The Trump administration has sent mixed signals on the Iran deal. On one hand, senior figures such as Secreaty of State Rex Tillerson and Secretary of Defense James Mattis have indicated their preference to maintain the JCOPA. Yet Donald Trump himself, and diplomats such as Ambassador Nikki Haley have suggested the U.S. may pull out of the agreement.
It looks likely that Trump will leave it up to Congress to decide whether to reapply U.S. sanctions on Iran, which would amount to a «material breach» of the nuclear deal. However, the deal does not depend only on the U.S.
«The forum will gather the highest level of attendees of any Iran conference to date»
Leaders from Europe, China, and Russia have been vocal that they believe Iran is adhering to the nuclear deal and that they will continue to engage Iran accordingly. For the business community in Europe, vocal support from government leaders is of utmost importance. This is why the Europe-Iran Forum will welcome Helga Schmid, Secretary General of the European External Action Service, in addition to five European Ambassadors to Iran as speakers. They will explain the European position and the influence Europe is seeking to exert in Washington.
Who is backing this forum?
The 4th Europe-Iran Forum (EIF4) is organized by Bourse & Bazaar in partnership with Adam Smith Conferences. It receives no government funding and is supported by its world-class sponsors and paying delegates.
What do you expect from this year's speakers?
The EIF4 will gather the highest level of speakers and attendees of any Iran conference to date. We are excited to hear from individuals such as Mohammad Khazaee, Iran's Deputy Minister for Economic Affairs and Finance and Farzaneh Sharafbafi, the newly appointed CEO of Iran Air. We expect frank discussions of opportunities and challenges and the exchange of creative ideas and strategies from individuals from a wide range of countries, sectors, and job roles. I am continually impressed by the determination of the individuals in the Europe-Iran Forum network, and I am confident that post-sanctions Iran will prove a remarkable success story!
Esfandyar Batmanghelidj has spent the last five years working on business diplomacy projects between the West and Iran. He is the founder of the Europe-Iran Forum, the leading annual gathering for business, government and civil society leaders committed to Iran's economic development. He is also the executive editor of Bourse & Bazaar, a digital business publication with a focus on Iran. He is a graduate of Columbia University.
