Investing in Iran: a really appropriate choice?

(To Marco Valerio Verni)
07/12/16

The fact that Italy is increasingly approaching Iran is now increasingly evident: a path that, to avoid going too far in time, started in January of this year, when Rohani's visit took place, during which the foundations were laid for various commercial and industrial agreements between the two countries, which then gradually materialized in the following months (April and July in particular), up to the recent Iran Country Presentation held at the Fiera di Roma and ended in recent days.

During the aforementioned event, according to the consultant for the internationalization of theIran International Exhibition, Ashgar Firouzabadi, they would have been "eleven preliminary agreements signed, for an amount of hundreds of millions of euro, within which it is worth mentioning the sale of 20 thousand tons of zinc to our companies. Of great economic value is also the agreement that allows the elimination of the Abu Dhabi intermediation in the aluminum trade between Italy and Iran, with consequent great cost savings for Italian companies".

The Fiera di Roma itself, for its part, would have concluded one j with Iran International Exhibition (the exhibition organization based in Tehran, co-organizer of the event), which, according to its president, as well as Iran's Deputy Minister of Industry, Mines and Trade, Hossein Esfahbodi, "will lead us to organize important events in the world together. Furthermore, the success of this first edition has already prompted us to set a similar appointment for next year: even in 2017 we will be organizing Iran Solo Exhibition with even more companies with Fiera Roma".

In addition to this, there could also be a military rapprochement between the two countries, witnessed by the visit of the frigate Euro, arrived in the port of Bandar Abbas in recent days (and already left) at a distance of fifteen years since another Italian Navy ship - the frigate Bersagliere - had to take the same step in the April of 2001.

In reality, the political action undertaken by the outgoing Renzi government against Iran is not at all exempt from criticism, and indeed raises many doubts from various points of view: (in primis), it should be emphasized that, despite the "JCPOA" Treaty (Joint Comprehensive Plan of Action, signed in Lausanne in April last year), the economic sanctions outside Iran's illegal nuclear proliferation program and the consequent prohibition, for companies and their affiliates, to operate in multiple sectors of the Iranian economy remain valid.

Subsequently, the consequent side effects of possible commercial agreements or, more generally, entrepreneurial agreements that have as object investments in Iran cannot be overlooked: meanwhile, the high risk that we can end up financing the Islamic Revolutionary Guard Corps, counted in the international lists of terrorist organizations, since it is not easy to know or understand if any Partner economic is a "clean" and respectable company or managed, in secret, by the Pasdaran.

In addition to a whole host of other problems, including:

1) the fact that the Financial Action Task Force announced, last June, its decision to keep Iran on the black list of countries that worry about illicit financial transactions and financing of international terrorism;

2) Iranian financial institutions remain excluded from the US financial system;

3) are very high fines for violations by international banks of American sanctions against Iran, also for cases concerning the involvement (sometimes unconscious: see what said above) in money laundering originating from the Persian country;

4) the risk of reintroduction of economic sanctions, especially following the recent Iranian behavior that would constitute violations of the nuclear agreement in the production of heavy water.

What has been said, moreover, has found comfort, and indeed has been reiterated with a loud voice, at the conference held last November in Rome, at the Senate of the Republic, entitled "Business Italy - Iran: a cost-benefit analysis ": In particular, Ambassador Giulio Terzi di Sant'Agata, a member of theUnited Against Nuclear Iran Advisory Board (UANI), the non-profit organization that organized the event, has clearly shown that not only the conclusion of the aforementioned Treaty (JCPOA) has not changed, contrary to the expectations of the Italian Government, Iran's attitude on the issues more relevant for regional stability and western security, but that there has even been a growing aggressiveness of the interventions of the aforementioned country that has radicalized the conflicts in Syria, Iraq, Yemen, also through the role of "proxy" of Tehran in terms of Shiite pre-eminence.

To this, it should be added that the fierce anti-Semitic propaganda, the provocations against Western values ​​(continued at the highest levels in the Islamic Republic of Iran), the veiled support for terrorist organizations in no way appeared so evident as to push the Department of US state to include Iran, despite Washington's efforts to consider it a reliable partner, among the major countries sponsor of international terrorism.

At the end, as well as highlighted by the ambassador, "Iran's implementation of the nuclear agreement is called into question by the numerous missile tests Iran continues to carry out despite being banned by Security Council resolutions. Regarding the Iranian defaults of the commitments made with the ratification of conventions and treaties concerning Human Rights, the situation in the country was further aggravated during the Rouhani presidency. The most recent reports by the UN Secretary-General certify the seriousness of the Iranian violations. In relation to the population, it is the country with the highest absolute number of capital executions, including those of minors and political opponents. The repression of political opponents has been very bloody since the 80 years, with numerous killings still carried out in recent years In Iran, Iraq and other countries".

In short, it is clear that investing in Iran is not at all risk-free: indeed, what in the immediate future may seem a lucrative investment, could easily prove to be, in the long term, a disastrous choice.