Iran-Sweden Private Sectors Discuss Banking Solutions

EghtesadOnline: As a Swedish business delegation met with their Iranian counterparts at the Tehran Chamber of Commerce, Industries, Mines and Agriculture on Wednesday, the ambassador of the Scandinavian nation conferred with the head of the private sector entity to discuss bilateral relations.

News ID: ۷۸۲۳۸۹

21 April 2018

Helena Sangeland, Swedish ambassador to Tehran, sat down with TCCIM chief, Masoud Khansari, and mainly spoke about expanding ties and its main impediment, weak banking links.

“Various barriers are in the way of Iran-Sweden trade, including banking issues and some non-economic hurdles,” the ambassador was quoted as saying by the TCCIM website.

However, Sangeland referred to high-level banking ties between a Swedish delegation led by Stefan Ingves, governor of Sveriges Riksbank, the central bank of Sweden, and Iranian counterparts as a positive development, Financial Tribune reported.

She noted that in addition to outlining the policies of the Swedish bank, its representatives mostly focused on issues such as training banking experts.

The meeting took place in early April in Tehran and officials also discussed economic growth, trust in the banking system, global standards and the massive project of renewing Iran’s truck fleet that is underway with the help of Sweden.

On Wednesday, Sangeland said it is good that representatives of Swedish companies are meeting face to face with their Iranian counterparts, which will help them become more acquainted with the capacities of Iranian markets.

“In returning to Sweden, they will pressure Swedish banks to establish links with Iran,” she said, but noted that as free market rules apply in Sweden, commercial banks are private financial institutions and the government and the central bank lack the legal authority to obligate them to work with the banks or companies of a particular country.

The ambassador also pointed to Iran-Sweden trade and said even as the years-long business interactions of the two countries slowed because of sanctions, Swedish companies have returned following the implementation of the nuclear accord and are now working with Iranian businesses in a variety of fields, including information technology and communications, environment and machineries, among others.

“Trade volume of the two countries is constantly fluctuating and even as these statistics may not reflect the true level of trade because of the deals that go through various channels, they indicate that the volume of Sweden’s exports to Iran have increased significantly,” she said.

Sangeland noted that Iran’s exports to Sweden have also risen, but is much lower as oil constitutes Iran’s bulk of exports which Sweden does not buy.

The latest preliminary data on non-oil trade released by the Islamic Republic of Iran Customs Administration show that in the previous Iranian year ending March 20, Sweden sent close to $705 million worth of goods to Iran to signal a year-on-year increase of more than 110%. This is while Iran exported close to $18.75 million worth of goods in the same period, which indicates an annual increase of almost 33%.

This brings the total volume of Iran-Sweden non-oil trade in the previous Iranian year to more than $723 million that was 108% higher than the year before.

During the Wednesday meeting, Khansari pointed to the truck fleet renewal project as a good opportunity to bolster Iran-Sweden relations and improve banking ties that will pave the way for a “significant jump” in bilateral relations. Referring to international political and trade developments, the TCCIM chief said, “Considering the interventionist and aggressive policies of Trump, European governments, including Sweden, have no other option but to operate independent of US policies.”

Khansari called on Swedish businesses to pressure their government into creating new channels, especially in the banking sector and said if Sweden waits for private banks with American shareholders to start working with Iran, no tangible results will materialize.

Ferial Mostofi, another senior TCCIM member, had recently spoken of the results of a last month meeting with Swedish bank and insurance representatives, saying their main issue in working with Iran was that “they had either invested in the US capital market or had American investors”.

Khansari told the ambassador that Iranian banks are currently doubling down on boosting transparency and implementing global standards, but said just like the nuclear deal where the US is creating severe problems even though Iran has been faithful to its commitments, the US is using banking problems to pressure Iran’s financial prospects and push its banks to the brink.

“Sweden supports Iran for its adherence to commitments under the nuclear deal,” Sangeland said.

The Swedish delegation, led by the head of Stockholm Chamber of Commerce, included representatives with Sparplatsen (fintech/insurance company), Norrtalje Municipality, Stockholm County (education), Didner and Gerge (fund management), Securum Consulting AB (corporate advisory services) and Bankomat AB (ATMs).