16th June 2000

Iran Trade Expansion - Risks and Rewards

Iran’s 3rd Five Year Plan, which is scheduled to continue a policy of general industrial development and inward investment, coupled with a US$5 billion redevelopment of the oil and gas industry and re-establishment of full diplomatic relations with Britain, signals an era of increased trade opportunities for British companies. Privatisation of many state-owned and state-controlled companies in Iran is boosting the demand for western technology and products. Iranian sponsors and principals of government-backed capital projects, whether in oil & gas, vehicle manufacturing, telecommunications, civil engineering or whatever, are signing up foreign joint venture partners who will bring both finance and expertise.

Comments Dr Waring: "Throughout most of the 1990s, there were very few British business visitors to Iran and sometimes I was the only English person on the plane. Now the situation has changed markedly - but so too has there been an upsurge of business visitors from our major European competitors such as Germany, France and Italy as well as Canada, China, Japan and Korea. Although American goods are available in Iran and US companies are tacitly welcomed by Iran to participate in capital projects, the United States government continues to block any such move. However, there are signs that the US position is softening. If and when US companies are allowed to re-establish direct trade with Iran, there is likely to be a flood of competitors to UK companies so they need to get in now".

However, there are risks for the unwary or inexperienced foreign business. Over a 5-year period 1992-1997, Dr Waring undertook an in-depth risk profiling study of Iran that involved a number of visits to and work in the country and detailed discussions with senior government officials and business leaders. He has also presented conference papers in Iran and has been interviewed for IRNA current affairs programmes. A summary of the study has been published as a chapter entitled ‘Iran: a Risk Profile’ in Waring and Glendon’s book ‘Managing Risk: Critical Issues for Survival and Success into the 21st Century’ available from International Thomson Business Press www.thomsonlearning.co.uk. Other summaries have included an article in International Risk Management and a paper presented at the Iran in the Millennium conference in London.

Pragmatic Assistance from AWA

• Briefings for executives on such practical topics as the risk profile of Iran, culture, language, business relations and management styles. Tailored for specific clients and sectors.
  
  
• Consulting support to UK partners in joint ventures, during conceptualisation, memoranda of understanding and agreement, contract preparation and delivery.
  
  
• Evaluation including share valuation of Iranian businesses for potential joint ventures, investment, acquisition or privatisation.
  
  
• Financial and accounting services for joint venture companies in Iran to meet Iranian fiscal requirements.
  
  
• Market research.
  
  
• Project risk analysis and profiling studies.
  
  
• Major hazards/safety/environmental studies.
  
  
• Management systems evaluation and development.

AWA Expertise

• Practical experience in and relating to Iran over many years.
  
  
• Consultants include both Iran-based and UK-based bilingual specialists
  
  
• Good connections.
  
  
• Sector experience includes oil & gas, IT/telecoms, civil engineering and general trade.

For Further Information Please Telephone:
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(+44) 208 351 7457

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For Further Information eMail:
waringa@cytanet.com.cy
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