German Firms to Help Iran Petchem
Iranian petroleum minister Bijan Zangeneh and visiting German economy minister Sigmar Gabriel held a press conference at the end of a joint conference between Iran’s Ministry of Petroleum and German delegation of businessmen in Tehran.
Zangeneh said $80 billion is planned to be invested in Iran’s petrochemical industry over the coming ten years, adding that this amount of investment will raise the value of petrochemical production in Iran to $70 billion from the current $25 billion a year.
Noting that an increase in Iran’s gas output would provide feedstock for petrochemical plants, he said most petrochemical plants in Iran have been constructed with technologies supplied by German companies.
Zangeneh said these companies would be of help to Iran’s petrochemical industry in the near future.
He referred to the development of the refining sector in the country, saying the country is eying high capacity in this sector.
“Our plan is to increase production by 1 mb/d in the near future and some German companies have voiced interest for presence in Iran’s upstream sector,” said the minister.
Zangeneh referred to LNG production as another plan pursued by Iran, saying a large number of machinery and equipment is needed for this purpose.
“Some equipment like turbocompressors was banned due to sanctions and we hope that this ban would be lifted soon,” he said.
Zangeneh said release of these turbocompressors would definitely help increase gas production, adding: “An increase in gas production will have positive effects on the environment because due to the shortage of gas we may have to use fuel oil.”
The minister also referred to underground gas storage as another activity of Iran, saying: “Given increased consumption in winter and reduced consumption in summer, underground gas storage is necessary. Given their good background, German companies can be of help in this regard.”
Zangeneh pointed to the relations between the two countries in the past and said Iran envisages cooperation with German companies for completing incomplete projects.
He said that banking support and finance by German banks is instrumental in cooperation.
“Banking and insurance issues need the approval of Hermes and Bafa and we hope that this process would be accelerated so that the hurdles would be removed,” he added.
Zangeneh noted that German companies have already been largely involved in Iran and that they could be decisive in the future.
“In addition to big companies, medium-sized and small-sized companies can also play a role in the future of Iran’s economy,” he said.
Iran Role in Germany Energy Supply
Gabriel, who is also German vice chancellor, said German economy needs raw materials.
“Along with other oil and gas producer countries, Iran can play a major role in supplying Germany its necessary energy. We also want cooperation in other economic and industrial sectors,” he said.
Gabriel said both sides should remain optimistic about better ties, adding that Iran’s nuclear agreement with six world powers encouraged German companies to rush for business with Iran.
He stressed the need for the resumption of longtime friendly relations between Iran and Germany, saying many German companies did not cut their interactions with Iran even under tough conditions of sanctions.
Gabriel said Iranian economic activists never lost hope in cooperating with Iran.
He called for Iran-Germany negotiations for the resumption of Iran-Germany Business Council, noting that Iran has changed over the past 15 years.
He said conditions should be prepared for foreign investment in Iran.
Gabriel said Germany is looking for win-win agreements, adding that German companies have to adapt themselves with the legal system of the country they are supposed to invest in.
He said Iran should settle its debts with Hermes before it would be able to benefit from its insurance services. He said a new account could be opened with Hermes if everything goes on as planned.
Gabriel said the international sanctions imposed on Iran over recent years have blocked cooperation between German banks and Iran. He, however, expressed optimism about the resolution of issues, noting that it may take some time.
He said German banks should be invited to Iran to settle issues as soon as possible.
Germany Instrumental in Nuclear Talks
German Vice Chancellor and Minister of Economy Sigmar Gabriel, who visited Iran at the invitation of Iran’s Minister of Petroleum Bijan Zangeneh, was received by Iranian President Hassan Rouhani.
At the start of the meeting, Rouhani said that many problems stem from trust building in meeting obligations. He added: “One of the most reliable ways for the implementation of the agreement reached between Iran and P5+1 group would be broader economic and trade ties between the two sides.”
“Businessmen, investors and different academic and scientific sectors of Iran have long been in contact with their German counterparts and we have always good memory of cooperation with the Germans,” he said.
Rouhani said the two countries can still develop relations in different economic and cultural fields as long as they go ahead with their political cooperation.
“Relations between the two nations are more essential than ever. Cooperation between universities, research and tourism centers can reconstruct the atmosphere of cooperation,” the president said.
He expressed happiness over the visit to Tehran of the German delegation following Iran’s historic nuclear deal, saying: “We hope that the German government, which played a positive role throughout the negotiations, would play its positive role in the expansion of relations between Iran and Europe.”
Rouhani highlighted Iran’s strategic position in the region including West-East connection, Central Asian countries’ access to high seas and West-East corridor, saying: “Close relations between Iran and Germany may establish closer ties between the entire region and Europe.”
“Given the existence of railway and developed roads, Iran can become the hub of production for the region and neighboring countries in case of investment,” he said.
Germany Eyes Return to Iran
For his part, Gabriel, who is also Vice Chancellor of Germany and energy minister, said developing business and economic ties between Iran and Germany is not a very difficult task.
The people of the two countries are highly skillful and have a strong tendency for advanced technologies; the current circumstances are unparalleled for boosting economic ties by the two countries, he said.
He said German tradesmen are keen to return to Iran and cooperate with their Iranian partners.
He welcomed the Vienna nuclear agreement which Germany regards as a new starting point for Tehran-Berlin ties and for relations between Iran and European countries.
Gabriel said the resolution of Iran’s nuclear issue is a new beginning for ties between Iran and Germany and also between Iran and Europe.
He said the first meeting of Iran-Germany Business Council is to be held in 2016, noting that the newly emerged opportunities should not be lost.
“German companies are not merely seeking to sell German products in Iran. They are also seeking to transfer technology and enhance the level of manpower skills in Iran,” he said.
Gabriel also said the German government supports investment by German companies in Iran.