Johannesburg - President Jacob Zuma drove to his bilateral meeting with President Hassan Rouhani in Tehran yesterday at the former palace of Shah Mohammad Reza Pahlavi.
Zuma’s motorcade was greeted by pomp and ceremony, including lavishly decorated horsemen lining the tree-canopied route to the palace.
The first statement Rouhani made in their joint media conference was that in 1979, Iran had stopped all oil exports to South Africa and severed economic ties by order of Ayatollah Khomeini, now deceased. Unlike the Shah, who had close relations with the apartheid government, the Iranian revolutionaries threw their support behind South Africa’s liberation movements.
In 1996, then president Nelson Mandela said: “After the triumph of the 1979 revolution, Iran sacrificed much in support of our cause. It refused to oil the system which the world regarded as a crime against humanity.”
Iran’s Supreme Leader, Ayatollah Ali Khamenei, extended an invitation to meet Zuma last night, which was a rare occasion, given that the Supreme Leader seldom meets heads of state. Zuma used the opportunity to reinforce South Africa’s position regarding Iran’s right to develop nuclear energy for peaceful purposes. The Supreme Leader is considered the country's ultimate decision-making authority.
The second key point which Rouhani made was that developing banking relations with South Africa would take the lead in expanding relations between the two countries. It is understood that certain members of the 100-strong South African business delegation came from the financial services sector. Resuming the banking and financial relationship with Iran will be a priority in strengthening economic relations.
This will be of particular significance as the US has lifted only some of the banking and financial sanctions, has not released Iran’s frozen funds, and is trying to block insurance companies from doing business with Iran.
South Africa has been assured that it will be prioritised to benefit from the Iranian economy in the post-sanctions era. Joint co-operation and investment in energy, mining and transportation are likely to be significant.
Ministers from both countries signed memorandums of understanding in the areas of industry, mining, trade, insurance, agriculture and water. There was also an agreement signed to form a joint investment committee.
The South Africa business delegation had significant representation from the oil and gas sector, with hopes to boost South African imports of Iranian oil and gas, and to partner in the construction of oil and gas refineries. Iran has more than 90 minerals, although a major part of the mining sector is not yet explored. This presents another area of possible co-operation.
South Africa’s goal is to restore its trade figures with Iran to the pre-sanctions level of $2 billion. Prior to sanctions, South Africa was importing 70 percent of its oil from Iran. While South Africa never supported sanctions and had an exemption to import oil from Iran, the challenges in the banking, transportation and insurance sectors militated against importing Iranian oil.
Now that these challenges are subsiding, South Africa would like to carve out a significant niche in the Iranian market, especially given that Iran is the largest gas producer in the world.
There is a long way to go to rebuild the seriously reduced trade relations, as according to Trade and Industry Minister Rob Davies, “it is only Palestine, Syria and Yemen that we export less to.”
Zuma also expressed South Africa’s interest in partnering with Iran in the tourism sector, and Rouhani spoke of the possibility of starting direct flights between the two countries.
*Ebrahim is the foreign editor of Independent Newspapers.
The Star