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Euro depreciation not to affect Iran greatly – expert

Business Materials 25 June 2016 11:09 (UTC +04:00)
The euro depreciation that followed the Brexit is not likely to affect Iran’s economy by a great deal, Mehrdad Emadi, a consultant at the UK-based Betamatrix International Consultancy believes.
Euro depreciation not to affect Iran greatly – expert

Tehran, Iran, June 24

By Mehdi Sepahvand – Trend:

The euro depreciation that followed the Brexit is not likely to affect Iran’s economy by a great deal, Mehrdad Emadi, a consultant at the UK-based Betamatrix International Consultancy believes.

“Although the euro depreciation will create some extra cost for Iran, since the major part of euros that Iran earns is spent on buying stuff from Europe, euro’s depreciation against the US dollar will, in practice, have little effect for Iran,” Emadi told Trend June 24.

“The euro’s value oscillation against other key currencies was a result of the British people’s vote to quit the European Union. I think Brexit will make Europe’s economy more vulnerable in the mid-length run. In the meantime, the vulnerability will increase the oscillation of the euro, which will increase the risk for Iran.”

“The depreciation of the euro against the dollar should not worry Iran, however, because Iran-US trade is currently small. But there is no doubt that the depreciation of euro against the Japanese yen will reduce Iran’s purchase power for buying industrial products from Japan,” Emadi stated.

The expert went on to say the EU is expected to pay for the depreciation when in their oil talks, Iran puts currency oscillations under insurance.

Britons held a referendum June 23 on whether the UK should to stay in the European Union, or leave it. The voting results indicate that the campaign to leave the EU, known as the Brexit, has won with 51.9 percent of the votes.

The EU used to be Iran’s great economic partner before the Islamic Republic got hit with sanctions. Tehran hoped to restore the economic ties following the removal of the sanctions in January.

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