Iran Commerce Chamber Urges Speedy Implementation of SPV

EghtesadOnline: Iran-Finland relations vis-a-vis US sanctions regime, cooperation between the Iranian and European small- and medium-sized enterprises, the Joint Comprehensive Plan of Action and a planned special purpose vehicle (SPV) were the main topics discussed by a European delegation in Tehran.

News ID: ۷۸۴۳۹۹

15 December 2018

Visiting chairwoman of the European Parliament’s delegation for relations with Iran, Tarja Cronberg, who has also served as Finland’s labor minister, and Iran Chamber of Commerce, Industries, Mines and Agriculture President Gholamhossein Shafei, held a wide-ranging talks on Tuesday.

The two sides highlighted the importance of the speedy implementation of SPV, the special payment channel created by Europe as part of its efforts to keep trade flowing with Iran in defiance of US sanctions, ICCIMA reported on its website.

"SPV would help solve a number of financial problems Iran is currently dealing with," Financial Tribune quoted Shafei as saying.

"Iran is optimistic about SPV. However, the European countries need to make the final decision fast and set a date at which this financial system would be activated."

On Monday, the European Union’s foreign policy chief said the SPV could be in place by the yearend.

The European Union wants SPV to help preserve the economic benefits for Iran promised by the 2015 nuclear deal with world powers, from which US President Donald Trump withdrew in May.

EU diplomats had hoped to have SPV in place by now but ran into delays, as member states balked at hosting it for fear of being targeted by the revived US sanctions regime against Iran.

Asked about progress on SPV, EU foreign policy chief, Federica Mogherini, told reporters: “I would expect this instrument to be established in the coming weeks so before the end of the year as a way to protect and promote legitimate business with Iran.”

She did not offer any other details following a meeting of the bloc’s foreign ministers in Brussels but said work on creating the mechanism was “advancing well”.

France and Germany are now due to take joint responsibility for SPV. But EU diplomats have said its ambitions could be scaled back to encompass only less sensitive items such as humanitarian and food products, rather than oil trade.

French Foreign Minister Jean-Yves Le Drian told the bloc’s ministers in a closed-door meeting in Brussels on Nov. 19 that Paris and Berlin were working closely to achieve something by the yearend, two other EU diplomats said.

Taking Stock of Iran-Finland Ties

“Despite the formation of a joint taskforce to address problems associated with Iran-Finland financial relations, a solution to see the back of such problems remains elusive,” he said.

Hailing Finland's stance on Iran’s nuclear deal with world powers, Iran’s top private sector representative said owing to past cooperation in agriculture and telecommunications, as well as the significant potential of the two countries, Iran and Finland can work on various projects in different economic sectors.

“US Department of Treasury is busy disrupting Iranian companies' relations with Europeans, including Finnish companies. However, economic relations with Iran have remained promising and offer significant growth potential, as the meetings between government officials and the private sector operatives of the two sides highlighted in recent months,” he said.

Referring to Finland’s extensive experience in preservation of environment and water management, and the fact that Iran is struggling with water shortage, Shafei said he believed the prospects of Iran-Finland cooperation in this context is encouraging.

“Renewable energies, oil and natural gas, medical equipment and mining are economic fields in which the two countries can forge a durable and constructive partnership. As we speak, Iran has investment projects worth $200 billion. The European country can turn out to be a good partner for Iran in carrying out these projects,” he said.

Noting that the development of countries like Finland and China is partly thanks to the their successful privatization of state-owned enterprises, Shafei said one of the key policies Iranian government is pursuing is to expand the real private sector's role as per its development plans.

“Iranian state-run companies are the prime target of US sanctions and that has led Europe and Iran to shift their focus on strengthening ties between their small- and medium-sized companies,” he said.

“Iran has long been affected by the negative impacts of sanctions, but on the flip side, it has learned to tap into local resources and capabilities to solve its problems. Currently, a number of commodities we used to import are produced within the country. Iran would pursue its goals and work out solutions to tackle its problems under the new round of sanctions with the support of Europe, including Finland,” he added.

Finnish Firms Willing to Return to Iran

The Finnish politician said she has met with the representatives of many Finnish companies that have been forced to halt their operations in Iran due to the US sanctions and they are all willing to return to Iran.

“Europe and the US do not see eye to eye when it comes to the Iran deal; the European countries will stand up for this agreement. Iran’s long experience with sanctions would help the country walk past the unilateral sanctions imposed by the US,” she said.

Cronberg assured that the EU would soon finalize SPV to boost imports and exports between Iran and other countries.

“At present, the UK, France and Germany are working this new experience. For the novelty of SPV for both Iran and the Europe, the project has taken longer than planned but I assure you that those in Europe who are in charge of this project are working 24 hours to implement it as soon as possible,” she said.

SPV would serve as a barter exchange neither connected to the US dollar-denominated international financial system nor requiring monetary transfers between EU countries and Iran.

An Iranian firm selling into Europe would accumulate credits that could be then used to buy a product from a different European firm.