With more than 133 years of history, Iran Chamber of Commerce which is older than Iran's petroleum industry regroups Iranian private entities. Iran Chamber of Commerce has 34 provincial branches and 200 specialized affiliates.
According to Iran's Constitution, Iran Chamber of Commerce now advises the three bodies of power in the Islamic Republic. It is also tasked with screening business environment and implementing Article 44 of the Constitution.
Iran Chamber of Commerce is also the representative of the private sector for negotiations with foreign companies and businesspeople.
Pedram Soltani, vice-president of Iran Chamber of Commerce, told Iran Petroleum that the chamber has hosted more than 133 business delegations from a variety of countries over the past one year alone.
The following is the full text of the interview:
Q: Given the extent of activities of Iran Chamber of Commerce, would you please explain about its cooperation with Iran's petroleum industry?
A: As one of economic ministries in the country, Iran's Ministry of Petroleum has many stakeholders at the Chamber of Commerce. There is a good and persistent interaction between this ministry and the Chamber. Over recent years, many meetings have been held with the minister of petroleum. Iran's petroleum industry top officials are present at the Energy Committee of Iran Chamber of Commerce. Furthermore, there are other organs and committees active in this Chamber with close ties with the petroleum industry.
Due to close ties between these bodies, the Federation of Petroleum Industry has been recently established at Iran Chamber of Commerce.
The presence of Iranian oil industry officials in the federation is an important point in this Chamber. That has so far contributed to interaction between the Chamber and the petroleum industry. Another instance of communications between this Chamber and the petroleum industry is the presence of the representative of the Chamber in the Economic Council for making decisions about petroleum industry projects.
Q: Iran-West nuclear agreement is now entering its second year. How has the implementation of this agreement affected your international communications?
A: As a highly positioned element in Iran’s private sector, Iran Chamber of Commerce has largely communicated with its counterparts in European and Asian countries both directly and indirectly over this time.
Since petroleum industry is the most known economic sector in Iran, all foreign companies willing to invest in Iran’s petroleum industry were naturally present in our negotiations. Therefore, we are making efforts to steer Iranian companies involved in the energy sector into cooperating with foreign parties. I would like to remind that oil and gas companies represent a significant share in business delegations visiting Iran. Meantime, we see many representatives of foreign companies travelling to Iran in order to meet with representatives of oil and gas companies.
In the new round of interaction between Iranian Ministry of Petroleum and international companies, our efforts have been focused upon serious presence in joint programs and conferences in order to let the private sector win a toehold and also create conditions for the private sector to get more involved in this industry and further win the trust of the Ministry of Petroleum.
Before the implementation of the Joint Comprehensive Plan of Action (JCPOA), we held talks with our counterparts in Asian and European countries. Last year alone, Iran Chamber of Commerce hosted more than 150 business delegations, 60% of which had come from European countries. This number of inbound trade missions in one year is an international record.
Currently, the grounds are prepared for cooperation between Iranian oil companies and their foreign counterparts and the only problems pertain to interaction and trade issues like banking transactions. Apart from that, both sides are keen to enhance the level of their ties.
Q: Has any foreign chamber of commerce opened an office in Iran in the wake of the implementation of the JCPOA?
A: Yes, some countries like Germany’s state of Bavaria, Austria, Italy and France have started their business activities through their embassies in Iran. Furthermore, Iran’s joint chambers of commerce resumed their activities with other countries. Recently, a number of requests have been submitted to the Chamber for establishing joint chambers with Iran.
Q: Over the past years, Iranian companies and manufacturers have crossed boundaries of science and technology to produce and export most basic petroleum industry commodities. Has Iran Chamber of Commerce had any activity in this regard?
A: As I mentioned before Iran Chamber of Commerce, which represents the private sector, is tasked with accelerating domestic companies’ move towards reaching their objectives. For instance, Society of Iranian Petroleum Industry Equipment Manufacturers (SIPIEM) is a member of Iran Chamber of Commerce. Such associations have in the past years made efforts to push Iranian companies into international arena.
Q: A vital and important project for Iran’s petroleum industry now is to manufacture 10 groups of equipment. Have you been involved in this?
A: Yes, many companies affiliated with Iran Chamber of Commerce are trying to manufacture the required equipment. In recent years, our knowledge-based companies have been seriously seeking to indigenize oil industry equipment and modern technologies. During their visits to the booths of these companies at the 21st Oil Show, oil industry managers were surprised at this high level of progress. Since Iran’s private sector has a stronger self-confidence than the public sector, it is not necessary for the public sector to be custodian of this sector. The dutiful structure of Iran Chamber of Commerce has fulfilled its obligations in recent years under the 11th administration.
Q: One of the concerns of Iran’s petroleum industry is to accelerate the development of shared oil and gas fields. A major solution to allying this concern will be to attract domestic and foreign investment into this industry and that is why a new model of oil contractual framework has been developed over the past two years. How has Iran Chamber of Commerce contributed to this issue?
A: Throughout formulation of these new contracts, Iran Chamber of Commerce experts were regularly attending the meetings of working groups. Given the role of this model of oil contracts in attracting foreign investment our experts have always supported these contracts.
Iran’s Ministry of Petroleum requires foreign companies to partner Iranian companies for involvement in the petroleum industry projects. This is in line with the policy of supporting Iranian companies and manufacturers. However, this chance should not merely benefit state-run and quasi state-run companies.
Q: As a businessman in Iran’s private sector, which infrastructure do you think is needed for the private sector’s more prominent role in domestic and foreign investment?
A: Some general grounds like ordinary international banking transactions; financing, reliable insurance guarantees like Italy’s SACE that opened a $3.5 billion credit line must be prepared. Following negotiations and an agreement with Germany’s Hermes insurance, we will soon witness the opening of a credit line by this insurance agency. In the transport sector, active companies must start cooperation with European companies. Iranian companies have barely any audited account or internationally recognized certificate. In other words, they are not known to international organizations and companies. Iranian companies must keep up with international regulations which are customary in the world. That has not been practiced in Iran for a decade and it has to be updated. Fortunately over the past year international consulting and service firms have moved to open representative offices in Iran. In our negotiations with foreign companies, we have always told them we will provide more support to them should they choose an Iranian partner for operating projects because Iranian companies are important for us. Iran Chamber of Commerce’s rating office rates private Iranian companies for cooperation with foreign companies. This office is planned to become a national rating center this year in order to continue its job with a better and more serious framework.
Q: How could the level of interaction between petroleum industry related associations and Iran Chamber of Commerce be enhanced?
A: Currently, of 17 industrial associations in the world, 12 are affiliated with the Chamber. We welcome other associations’ application to join the Chamber.
Some issues are domestic; for example, the government or the petroleum ministry’s further trust in the private sector. In the past years, the nationality of Iranian companies has cost them dearly because these companies have been driven out of international markets due to sanctions. Therefore, now that the JCPOA has been implemented these companies must be privileged.
Q: The quality of commodities and equipment is of high significance for Iran’s Ministry of Petroleum. This ministry maintains that domestic and foreign companies must bid for tenders under equal conditions. What do you think?
A: We believe that low-quality equipment could turn out to be dangerous for projects. The Ministry of Petroleum can use foreign equipment, but if there is no high risk it must use Iranian commodities and products.
Q: After the JCPOA implementation, a post-sanctions committee was set up at Iran Chamber of Commerce. Would you please brief us about its activities?
A: This committee was established in June last year. There have been efforts under way for Iranian private companies to play a more prominent role in commerce, financial and insurance affairs. Another activity of this committee has been to process the achievements of JCPOA and monitoring them.
by Hamid-Reza Shakeri-Rad
Iran Petroleum
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