Iran’s Central Bank says it, as well as the country’s financial institutions, are compliant with international norms.

Despite the recent lifting of economic sanctions against Tehran by the West in return for strict supervision of its nuclear energy programme, there have been some concerns raised as to the financial business environment.

“Iran during the sanctions period was denied free access of foreign markets, so the cost of borrowing was a big issue,” said Iran Central Bank general director of international cooperation, Yaghoubi Miab at last week’s International Economic Forum (SPIEF) in St Petersburg.

“Things are now moving towards the right direction – now the European banking community has got all confidence about being in business with the Iranian banking sector. We have started negotiations with Gazprom Bank and they have promised to open this account in two weeks. Russian banks will face no difficulties with Iranian banks.

“We have no issues with compliance – we expect to have a smooth way. Not [only] the Central Bank of Iran, but also other financial institutions have been complying with international norms.”

Part of the attraction for foreign investors – and PSA Groupe announced only this week it had firmed up its 50/50 US$451m joint venture with Iran Khodro in manufacturing and R&D capacity for the next five years – is the availability of a young and educated workforce anxious to put their skills into practice.

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“Iran has the highest proportion of engineers in the world per head,” said Iran Chamber of Commerce, Industries, Mines and Agriculture, Pedram Soltani, told the SPIEF 16 session, ‘Life after Sanctions; Re-integrating Iran into the Global Economy.’

“We have a young, talented and educated workforce in Iran. Even start-ups are booming. The nature of business in Iran is changing rapidly from bricks and mortar to ebusiness. Iran has a vast population, almost 80m and with its near neighbours, it is a 300m people market.

“Automotive, consumer items, white goods, these are [an] attractive opportunity for investment in Iran. I admit we have some problems with our investment climate, but things are improving.

“We have, of course, some hassles, we don’t want to show a rosy garden. The banking system [for example] should undergo some major restructuring, we have some shortage of finance.”