Iranian reformist press on aspects of Boeing deal

Business Materials 13 December 2016 10:01 (UTC +04:00)
Iranian reformist press, drunk with the wine of the incumbent government’s victory in the biggest US-Iran aviation deal since the country’s 1979 revolution
Iranian reformist press on aspects of Boeing deal

Baku, Azerbaijan, Dec. 12

By Farhad Daneshvar – Trend:

Iranian reformist press, drunk with the wine of the incumbent government’s victory in the biggest US-Iran aviation deal since the country’s 1979 revolution, have seized the chance to respond to conservatives’ concerns over the competency of the last year’s milestone nuclear deal (aka Joint Comprehensive Plan of Action/JCPOA) to benefit the Islamic Republic.

State airline Iran Air finalized a historic deal with the US aircraft maker Boeing on Dec. 11 to acquire 80 passenger planes, fuelling media speculations on the future of economic ties between the Islamic Republic and the US during the President-elect Donald Trump’s term.

Conservatives over the past year have continuously criticized President Hassan Rouhani’s government over the nuclear deal, but the administration came under bitter criticism over the past month when the US House of Representatives passed a bill designed to halt the sale of commercial aircraft to Iran.

On the other hand, Donald Trump’s critical remarks over the nuclear accord and efforts made by Congressional Republicans to kill the JCPOA have given valid grounds for pessimism about the idea of whether the nuclear deal is capable of producing economic benefits for the Islamic Republic.

Although most of the prominent conservative outlets have, so far, declined to comment on the Boeing-Iran Air deal, newspapers close to the moderate President Rouhani have examined the positive aspects to the "Sunday’s deal".

New chapter in Iran-US economic ties/Airbus now lags behind Boeing

While some observers suggest that the Boeing-Iran Air deal would be considered as the beginning of an economic partnership between Iran and the US during Trump’s era, some others say Boeing has overtaken its European rival, Airbus, in gaining share from Iran’s huge market.

Hamdeli newspaper ran a report on the issue saying the fact that Boeing overtook Airbus in Iran encourages the speculations that the US economy is probably going through a new phase planned by Trump.

Airbus was first to launch talks over aircraft deal with Iran following the removal of international sanctions against the Islamic Republic in January. On the other hand, many believed that reaching a deal with Airbus would be easier than with its American counterpart due to its affiliation with Europe which demonstrated more friendly approach towards establishing ties with the Islamic Republic in the post-sanctions era.

Competition over Iran’s market

Tejarat Newspaper noted that the Boeing deal was not an outcome of political issues but a quite economic competition between the world’s large companies to break into the Iranian market.

Boeing and Iran stroke the deal in a situation that the Islamic Republic officials had earlier turned to Russian and Japanese aircraft makers for talks on renewing the country’s aged aviation fleet as Tehran seemed doubtful over reaching a deal with European and American plane makers due to concerns over the Westerners’ political approaches.

In this condition, the Boeing deal is considered as a victory against other rivals in gaining market share.

Trump may honor nuclear deal

In the meantime, some others have taken the Boeing deal as a sign indicating that American politicians, in particular Donald Trump may remain committed to the US obligations regarding the nuclear deal.

Donyay-e Eqtesad newspaper has stated that an economic aspect of the Boeing deal is that the aviation agreement is a major one creating at least 100,000 new job opportunities in the US which is in line with Trump’s campaign promises to improve the economic situation of the Americans, therefore it seems that the US president-elect would refrain from scraping the deal.

Supporters of this idea suggest that the Boeing deal is also likely to have a positive impact on efforts to finalize a deal between Airbus and Iran. In fact if Iran and Boeing manage to implement the deal, it means that legal and financial obstacles to the contract are already eliminated, therefore Airbus is also capable of going on with the Islamic Republic. So, Boeing’s return to Iran would be taken as a permission to Airbus to do business in Iran. It could also be considered as a signal that the US has a strong willingness to establish full scale business ties with Iran, so others are also safe to do business in Iran.

Etemad newspaper said that economic deals between Iran and international leading companies may encourage large banks, which have been reluctant to do business with Iran over concerns on running afoul of US regulations, to return to Iran.

What if Trump rejects the deal?

Ebtekar newspaper has said that the Boeing deal conveys the message that the US officials have accepted the realities of the nuclear deal prior to Trump’s assuming power and the Westerners understand that it will bring about implications if they breach the terms of the nuclear deal.

Shahrvand newspaper believes that the Boeing deal has weakened the structure of sanctions against Iran as aviation has been considered as Iran’s hot-button regarding the sanctions over the past 30 years. Therefore, the American giant’s return to the Islamic Republic will improve Tehran’s relations with the world, recognizing the Islamic Republic’s right to establish business ties with the rest of the world.

Shahrvand added that Trump may cause some difficulties in financing Iran’s purchase of aircraft.

In this case, Japanese banks would be helpful as Boeing has launched talks with two Japanese banks over financing its deal with Iran.