Rouhani in France as West eyes lucrative Iran contracts

Rouhani in France as West eyes lucrative Iran contracts
As Iranian president Hassan Rouhani headed for France Wednesday for second leg of his European tour after Italy, he called for US investments in Iran with Canada also lifting sanctions.
5 min read
27 January, 2016
Iran's president has been pleased by the West's welcome and appetite for lucrative contracts [Getty]

Iranian President Hassan Rouhani wrapped up a visit to Italy on Wednesday before heading to France on the second leg of a trip signalling Tehran's rapprochement with Europe after sanctions were lifted against the Islamic Republic.

Rouhani's visit to Paris is expected to result in the signing of major business contracts, on the heels of multi-billion-dollar deals in Italy.

An order for 114 Airbus planes to modernise Iran Air's ageing fleet is expected to be confirmed in France, along with tie-ups with carmakers Peugeot and Renault.

Rouhani also invited American businessmen to join their European counterparts in investing in Iran.

He said that Europe and the US had lost out as a result of the sanctions, but that now European countries were in a position to not only recover their traditional trading relationship but improve on it. 

Such a positive relationship could exist with the US if Congress were to "end the tensions and hostility," Rouhani said.

"It's possible, but the key is in Washington, not in Tehran," he said. "At the same today, if American investors and the heads of the American economy, if they want to come to Iran and invest in my country, there are no problems from our point of view."

Asked whether Iran would apologise to Saudi Arabia for an attack on its embassy, Rouhani said it was not up to his country to make a move for reconciliation

Rouhani had concluded his two-day trip to Rome with a visit to the Colosseum with Italian Culture Minister Dario Franceschini and a press conference.

Asked whether Iran would apologise to Saudi Arabia for an attack on its embassy that led to Riyadh cutting diplomatic ties with Tehran, Rouhani said it was not up to his country to make a move for reconciliation.

"Why should we apologise, because (activist and Shia cleric) Nimr al-Nimr was executed? We are the ones to apologise because they are killing the people of Yemen? Apologise to them because they are helping terrorists?" he said.

"They are the ones who should apologize to Muslim people, hundreds of times."

Business push

The president is accompanied by a delegation of more than 100 ministers, officials and businessmen marking the return of Iran on the international economic stage with the lifting of sanctions after a historic deal over Tehran's nuclear programme.

Rouhani, a 67-year-old former academic and diplomat who is seen as a pragmatist, was elected in 2013 on a pledge to end sanctions and improve relations with the West.

The Iranian leader on Monday met with his Italian counterpart Sergio Mattarella and Prime Minister Matteo Renzi, with whom he attended the signing of several economic agreements in the prestigious setting of the Capitole.

Italian officials said contracts signed in Rome would be worth up to 17 billion euros ($18.4 billion), underlining the huge economic stakes involved in Iran's re-opening, particularly for Europe's manufacturing and engineering sectors.

Iran is the safest, the most stable country in the entire region
-Hassan Rouhani

On Monday, Rouhani attended a business forum at which he portrayed Iran as the ideal base for companies seeking a foothold in a region of 300 million people, reassuring would-be investors their contracts would be honoured.

"Iran is the safest, the most stable country in the entire region," Rouhani said.

"Everyone understood that the nuclear negotiations represented a win-win situation for both sides.

"Now we have created the conditions for investment and for the transfer of know-how. There has to be an advantage for both sides: we invite you to invest and we will provide stability and ensure that you can make adequate returns."

Rouhani then visited the Vatican for the first time and met Pope Francis, who has urged Iran to work for peace in the Middle East.

In a statement afterwards, the Vatican said Francis had urged the Iranian leader to use Iran's important role to promote, together with other countries, "adequate political solutions" to the problems afflicting the region and to help combat terrorism and arms trafficking.

It was the first official visit to the Vatican by an Iranian president since Mohammad Khatami was hosted by John Paul II in 1999.

"Modernizing our fleet"

Rouhani is due to arrive late Wednesday afternoon in Paris where he will meet the following day with President Francois Hollande and French business leaders.

Ahead of Rouhani's European trip, Iranian Transport Minister Abbas Akhoundi on Sunday announced a major contract with Airbus for 114 planes.

Akhoundi, quoted by Iranian media, said the deal "will be signed between Iran Air and Airbus" when Rouhani is in Paris. An Airbus spokesman declined to comment.

Before flying to Europe, Rouhani himself mentioned economic projects between Iran and France.

"We need to modernise our aviation fleet and buy locomotives," he said Monday, adding that "important contracts will probably be signed on this trip including with Peugeot and Renault".

Iranian Transport Minister announced a major contract with Airbus for 114 planes on Sunday

A joint press conference is planned after Rouhani's meeting with Hollande on Thursday, the French presidency said.

Iran has been rebuilding its relations with Italy and France which were among Tehran's main economic partners before the tightening of international sanctions in January 2012.

Competition to tap the Iranian market has been fierce as it emerges from international isolation with the lifting of sanctions.

Canada joins the bandwagon

Canada confirmed for the first time on Tuesday that it plans to lift its sanctions on Tehran and said that if Airbus is allowed to sell to Iran, then its aircraft maker Bombardier Inc should be allowed to export there as well.

"Canada will lift its sanctions but what Canada will maintain is our suspicion of a regime ... that must not return to (trying to obtain) nuclear weapons," Canada's Foreign Minister Stephane Dion told the House of Commons on Tuesday.

"If Airbus is able to do it, why (will) Bombardier not be able to do it? In which way (is it) helping Canada, or the Iranian people, or Israel, or anyone, that Canada is hurting its own industry?" Dion said in an exchange with reporters.