Paul Taylor Paris

Iranian President Hassan Rouhani will court global business in Davos this week after some economic sanctions were eased, but any trade bonanza depends on the long-term success of nuclear diplomacy.

An American stranglehold on Iran’s access to the international financial system, the uncertain future of talks on its nuclear programme beyond a six-month initial deal, and vested interests in the Islamic republic suspicious of Western investment, all stand in Rouhani’s way.

“I would be surprised if you saw Iran shooting quickly to the top of the list of attractive markets, although it may be attractive for certain manufactured goods companies in the short to medium term,” said a Western business consultant.

“The fact that Iran is making signals in the right direction is welcome but I think the bulk of business people will be cautious and will play a bit of a wait-and-see game,” he said, asking, like many involved with Iran, not to be identified because of political sensitivities.

After a charm offensive at the UN in September last year, the pragmatic Rouhani opens act two of Tehran’s return to the international stage when he addresses the World Economic Forum in Davos on Thursday.

In the short term, business opportunities are limited mostly to areas such as food and consumer goods, medicines, cars and petrochemicals under the interim accord. Iran will be able to spend $4.2 billion (R45.58bn) in unfrozen funds over six months, although most sanctions remain pending a long-term agreement.

But the potential of a market of 76 million people in a country with some of the biggest oil and gas reserves is a magnet for foreign firms seeking long-term opportunities. Iran has said it wanted seven oil companies – Shell, Total, Eni, OMV, Statoil, Exxon Mobil and ConocoPhillips – to return.

Bijan Khajehpour, a Vienna-based Iranian business consultant at Atieh International, said there were the beginnings of a “gold rush” mood in Tehran, with Russia and China racing to pin down oil-for-goods barter deals before Western companies arrived with the technology that Iran most wanted.

A spokeswoman for Tehran’s Homa hotel, a centre for international business, said numbers of European guests had risen 30 percent from last year. But neither the hotel nor flights to the capital are full.

Khajehpour said Tehran understood no Western firm would return on the terms imposed in the past, which banned foreign ownership of Iran’s hydrocarbon resources. – Reuters