Corporate News & Business

Minerals, mining exports expected to reach US$ 5.5 billion (Tehran Times, 05 March 2017)

Deputy Industry, Mining and Trade Minister Mr. Jafar Sarqini said that value of Iran’s annual minerals and mining industries exports is expected to reach $5.5 billion by the end of current Iranian year (20 March 2017). The official put the worth of minerals and mining industries exports from the country at US$ 4.5 billion during the first ten months of this Iranian year (20 March 2016-19 January 2017). He also announced that the value of minerals exports from Iran during the mentioned ten-month period compared to the same period of time in the previous year rose 50% to stand at $900 million and is anticipated to hit US$ 1.1 billion by the end of current year.

Iran cement exports: 11.5m tons in 11 months (Tehran Times, 05 March 2017)

Minister of Industries, Mining and Trade Mr. Mohammad Reza Nematzadeh said Iran exported 11.5 million tons of cement during the first 11 months of the Iranian year (March 2016-February 2017). He expects the figure to reach 15 million tons, production to hit 60 million and output capacity to stand at 82.5 million by the end of the current fiscal year (20 March 2017). Iran is currently the world’s seventh largest cement producer. More than 15 million tons of cement and clinker were exported in the last Iranian year, with Iraq accounting for close to 65% of the figure.

VW imported cars arrive in Iran (Financial Tribune, 05 March 2017)

Local automotive firm Mammut Khodro has received the first delivery of Volkswagen cars the German company intends to import to Iran. Mammut Khodro has been VW’s local partner in importing a limited number of cars in the past two years. The two companies recently formed a joint venture through which – in addition to imports – they are to set up an assembly line by April 2017.  The VW’s Polo hatchback is rumored to be the first vehicle to be produced in Iran by the new venture.

ArcelorMittal expands steel sales to Iran (Financial Tribune, 05 March 2017)

The world’s largest steel producing group of companies–ArcelorMittal–expanded its cooperation with Iran in 2016 by increasing steel product shipments to the country. In 2016, steel sales of ArcelorMittal’s subsidiary ArcelorMittal International FZE in Dubai, otherwise known as AIMD, to customers in Iran generated $388 million in revenue. IMD has been marketing construction steel and flat products to Iran as well as API grade slab products for use in the energy and petrochemicals sector.

In the meantime, ArcelorMittal’s Europe division has been concentrating on sales of coated flat products, alloy steel plates and stay cable strands both directly and indirectly for projects in Iran. The company generated US$ 5.8 million in revenue and US$ 0.8 million in profit in 2016.

 

Iran, Sri Lanka to boost economic ties (Mehr News Agency, 04 March 2017)

Parliament Speaker Mr. Ali Larijani has called for an uplift in economic, trade and tourism relations between Iran and Sri Lanka. The official recalled that Iranian contractors could take the emerged opportunity in the field of technical and engineering services and urged then to spare no effort in export and import arenas. Mr. Larijani voiced satisfaction towards the proposal for tourism cooperation noting that finding a solution to banking issues and expansion of oil and gas activities were other issues raised at the joint meeting with his Sri Lankan counterpart Mr. Karu Jayasuriya.

 

Rail freight service to connect India with Iran, Turkey (India Times, 03 March 2017)

Indian Railways is exploring the possibility of a transcontinental rail freight service connecting India with Iran and Turkey. Considered to be a major boost for trade and economic development of the Asia Pacific region, a trans-container goods train from Dhaka to Istanbul covering Bangladesh, Bhutan, India, Nepal, Pakistan, Afghanistan, Iran and Turkey.  Even though Bhutan and Afghanistan do not have rail connectivity at present, Bhutan can be connected by road from Kolkata and in Afghanistan containers can be loaded by connecting road routes with the railway network at Quetta. The international project covering about 6,000 km aims to significantly reduce the currently high tariff and non-tariff costs to trade between these countries. Taking the lead in the intra-regional freight transport, Indian Railways has convened a meeting of South Asian railway heads involved in the project on 15-16 March 2017. There are various conferences and feasibility studies conducted by Economic and Social Commission for Asia and the Pacific (ESCAP) on rail network connecting Bangladesh, Bhutan, India, Nepal, Pakistan, Afghanistan, Iran and Turkey.

 

Finance

 

Iran to preserve single-digit inflation rate (Tehran Times, 05 March 2017)

First Vice President Mr. Es’haq Jahangiri announced that Iran is expected to maintain a single-digit inflation rate during the upcoming years. Since late June 2016, official Iranian statistics published in Iran put the inflation rate at below 10%. Curbing inflation was one of the major promises by Iranian President Hassan Rouhani during his presidential campaign. Under the previous administration, inflation skyrocketed to 44%.

Banking bills encounter hurdles in cabinet (Financial Tribune, 05 March 2017)

President Mr. Hassan Rouhani’s Cabinet has redirected the two major banking bills aimed at reforming the Iranian banking system to the Central Bank of Iran (CBI). The two banking bills named Banking Reform Bill and the Central Bank Bill have been sent back by the Cabinet for the CBI and the Ministry of Economic Affairs and Finance to conduct more reviews on them. Member of the CBI’s Fiqh Council said that that the Cabinet, which was supposed to ratify the draft bill before forwarding it to the parliament for final approval, had found shortcomings with them. The Banking Reform Bill defines the duties of the banks and non-bank credit institutions, explains all banking operations and services, sets up a professional set of criteria for selecting new chief executives and board members, and makes provision for setting up internal risk and auditing committees. The Central Bank Bill whose law was first passed in 1972, aims to modernize banking regulations. Improving the independence of CBI, enhancing monetary policymaking and increasing CBI’s supervision over the money market are among its key goals.

 

Oil & Gas

 

Iran ready to ship 100 bpd crude to South Africa (Mehr News Agency, 05 March 2017)

On the sidelines of a meeting with the visiting South African Energy Minister Mrs. Tina Joemat-Pettersson, Oil Minister Mr. Bijan Zanganeh has voiced Iran’s readiness to deploy 100 thousand barrels of crude oil per day to South Africa as well as to purchase refinery shares there. In addition to oil exports, talks were also held with the South African side over implementing Gas to Liquids (GTL) projects. Mr. Zanganeh stated that Iran’s state oil companies such as the National Iranian Oil Company (NIOC) and National Iranian Oil Refining and Distribution Company (NIORDC) should not be involved in the deals, adding that private sector, with the help of Iran’s National Development Fund, could participate in the purchase of the refinery shares.

 

South Pars oil layer to yield crude soon (Mehr News Agency, 04 March 2017)

Deputy Oil Minister and Managing Director of the National Iranian Oil Company (NIOC) Mr. Ali Kardor said crude production from South Pars oil layer will begin as of early April thanks to arrival of the first Floating Production, Storage and Offloading (FPSO) in the Persian Gulf. Managing Director of the National Iranian Oil Company (NIOC) highlighted that oil recovery from South Pars oil layer, as a joint filed, will become realized as long as early April with an initial output of 20-25 thousand barrels though the figure will climb to 35 000 barrels per day once the first development phase is accomplished. He pointed to talks with several international firms for the second development phase of South Pars oil layer asserting that the joint oilfield enjoyed the capacity to produce at least 100 thousand barrels of crude oil per day. Meanwhile, Managing Director of National Iranian South Oil Company (NISOC) Mr. Hamid Bord had recently estimated that South Pars oil layer held over 14 billion barrels of crude oil in place.

Iran to turn into ME ethane giant (Mehr News Agency, 04 March 2017)

With implementation of new South Pars phases, Iran’s ethane output is to double. Over the past two decades of development in South Pars joint field, he main focus has been always placed on recovering more natural gas and gas condensate as two main products, leading to difficulties in supplying feedstock to the country’s petrochemical industries as more ethane-based units in Assalouyeh come on stream. Iran’s current ethane consumption capacity amounts to about 5.250 million tons per year, while only 3 million tons are produced annually. Completion of South Pars Phases 17, 18, 19, 20 and 21 by early April 2017 will add 3million tons to Iran’s ethane output capacity. The rise in ethane production from South Pars field is expected to increase the country’s petrochemical and polymer production by 10% to 20%. Over the past four years, the US has turned into one of the largest producers of ethane by relying on shale gas.

 

 

 

Economy & Society

Iran-made PEVs ready for sale (Financial Tribune, 05 March 2017)

Electric cars developed at a knowledge-based firm affiliated to the Islamic Azad University, Qazvin Branch – Parax Company – will soon hit the roads according to the University Dean Mr. Morteza Moosakhani, who added that 100 electric cars will be given license plates soon and be ready for on-road testing. He said that negotiations were underway with three major local investors and commercial production is expected to begin in the next fiscal year (21 March 2017-20 March 2018).

Lack of diversity in Iran’s trade partners (Financial Tribune, 05 March 2017)

Forty-three Asian countries accounted for close to 93% of Iran’s non-oil exports during the 10 months to 19 January 2017, according to a report by Tehran Chamber of Commerce, Industries, Mines and Agriculture, citing the Islamic Republic of Iran Customs Administration’s data. China, the UAE and Iraq, each with a 20%, 17.1% and 15.4% share respectively, were Iran’s main export destinations in Asia. China was the main customer of Iranian products in the 10-month period, as Iran exported US $6.54 billion worth of non-oil goods to the Asian country, a 9.53% rise compared with the same period of last year. Following Asia, Europe accounted for 4.3% of Iran’s non-oil exports during the period under review. With a combined share of 67%, Italy, Germany and Spain were the biggest customers of Iranian non-oil commodities in Europe. Around 31% of the exports to Africa were made to Egypt, making it Iran’s main African export destination. Morocco and Mozambique followed with a 9% and 8% share respectively. Iran’s exports to North and South Americas were minimal, accounting for 0.4% and 0.3% of the total non-oil exports respectively. The US with a 54% and Brazil with a 93% share were Iran’s main customers in the Americas. China, the UAE, South Korea, Turkey and Germany were the main exporters of commodities to Iran over the 10-month period. The biggest exporter to Iran was China with exports of over 3.6 million tons of goods worth US$ 8.4 billion, accounting for 13% and 24% of Iran’s total imports in terms of weight and value respectively. The UAE, the second biggest exporter, sold 4.4 million tons of goods (US$ 5.47 billion) to Iran, making up 15% of the country’s imports in both weight and value. South Korea, Turkey and Germany exported 1.2 million tons of goods worth US$ 2.8 billion, 1.32 million tons valued at US$ 2.2 billion and 843,000 tons worth more than US$ 1.96 billion to Iran over the same period respectively. Iran exported US$ 35.27 billion worth of non-oil commodities during the period, registering an 8.37% rise year-on-year.

By Natela Outtier