PwC Working to Establish Iran Presence

EghtesadOnline: PricewaterhouseCoopers, a leading multinational professional services network, is working to establish a formal presence in Iran, as foreign interest in the Iranian economy has surged after years of sanctions kept the country secluded from the rest of the world.

News ID: ۷۴۳۸۴۴

19 September 2017

"We see a huge potential for our services here in Iran as well as for our multinational partners. As far as our services are concerned outside of Iran, there is a big demand and there is a more positive focus going forward," Jens Ronnberg, a senior partner for PwC and its head of Iranian market, said in an interview.

According to Ronnberg, because PwC has its main trust registered in the US state of Delaware, it needs to obtain permission from the US Treasury Department's Office of Foreign Assets Control, which he hopes to be granted in due time.

"We have filed an application and it's pending," he told the Financial Tribune on the sidelines of a seminar hosted by Tehran Chamber of Commerce, Industries, Mines and Agriculture on Tuesday attended by several senior officials and pundits.

"We are hopeful of getting the license otherwise we would not be here," Ronnberg said, adding that getting a license under the current circumstances might not be easy, but he's confident that it will go through.

"Our competitors are already here and for OFAC denying us permission would be a competitive disadvantage," he said.

After the removal of sanctions in January 2016 in the wake of the landmark multi-nation nuclear deal, a deluge of foreign delegations entered Iran to explore the "last frontier market" that had become available to global investors.

In spite of fears of remaining US sanctions, mega deals have been signed with French oil giant Totaland finance agreements worth billions of dollars have been finalized with South Korea and China.

However, as many Iranian lender and companies struggle to implement transparency and compliance measures, both the Central Bank of Iran and the private sector have launched an initiative to catch up on the latest international standards in order to become eligible players on the world stage and reclaim their pre-sanctions status.

The Iranian business community, in particular, has been proactive in its approach, inviting top-notch consulting firms and rating agencies to explore the country's potentials and help its economy to bounce back after its long-running torpor.

In the past months and weeks representatives from such big names such as Deloitte, Fraser, EY and KPMG have visited Iran.

Compliance

At Tuesday's event, representatives from PwC hobnobbed with senior Iranian officials and business figures, including Masoud Khansari, the head of TCCIM, Hassan Qalibaf-Asl, CEO of Tehran Stock Exchange, Parviz Aqili, CEO of the privately-run Middle East Bank–which is to open a Munich branch before 2017 ends–and an eminent economist, Mohammad Mehdi Behkish.

Addressing the gathering, Khansari emphasized the need for transparency, an upgrade in Iran's global economic indicators such as economic freedom and broader engagement with the world, which are prerequisites for drawing foreign domestic and foreign investment.

In his address to the gathering, Ronnberg urged Iranian entities to enhance transparency of their operations and upgrade their balance sheets as per the International Financial Reporting Standards to become ready for their partnership with European firms.

"Compliance, Compliance, Compliance," he stressed.

Enthusiasm

Qalibaf-Asl also spoke of the measures  taken to develop Tehran Stock Exchange such as the introduction of new finance tools and cooperation with major international bourses, particularly Borsa Instanbul.

"We are working to list Iranian firms on global stock exchanges for the first time," he said.

The reception of participants at Tuesday's event was warm, as they came up with many questions and proposals on how to improve the business climate. Likening the presence of international  auditors and consulting firms in Iran to the presence  of foreign head coaches in Iranian sports teams, one private sector  official deemed their cooperation vital.

"Just like Carlos Queiroz improved Iranian soccer, these firms are expected to do the same," said Mohammad Reza Najafi-Manesh, a member of TCCIMA's board of directors.