A glance at Iran’s authorized projects for foreign investment

Business Materials 21 November 2017 16:34 (UTC +04:00)

Baku, Azerbaijan, Nov. 21

By Fatih Karimov – Trend:

The Iranian administration authorized $1.831 billion in foreign direct investment during the first half of the current fiscal year (started March 20), according to a report released by the country’s ministry of Industry, Mine and Trade.

The figure is 58 percent more compared to $1.156 billion worth of projects approved by the administration in the same period of the preceding year.

Over 33 investment proposals, including 28 new projects were approved by Iran's Foreign Investment Board in the 6-month period, compared to 24 proposals in the first half of the last fiscal year.

Germany stood at the top of the list of approved investment projects with $720.87 million for construction of a production plant of photovoltaic panels.

During the mentioned period, statistics from the Iranian government put the Irish investors in second place with $466.155 million worth of investments for a mining extraction and exploitation project, followed by Chine with a $232.551 million investment at Rigan Khodro, a subsidiary of Kerman Motor auto manufacturing plant.

Dutch investors also are at the top place with $102.056 million of investment for an online trade project. The Iranian partner of the Dutch side is Digikala, the biggest e-commerce startup in Iran. The company was reported to be valued at $500 million in late 2015. One of its investors is Russian billionaire Vladimir Potanin, although Digikala's main investor is Sarava Pars, an Iranian investment company.

Saudi investors plan for increasing the assets of Savola Behshahr Company by $92.495 million is also at the top place amid political tension between Tehran and Riyadh.

Saudi food producer Savola, one of the few Saudi companies with a presence in Islamic Republic, earlier announced that will it stay in Iran despite the tensions. Savola holds a 90-percent stake in Savola Behshahr Company, which dominates Iran’s edible oil market with some 40-percent market share.

The Iranian Industry, Mine and Trade ministry’s statistics also unveils that a Turkish investor proposal for increasing the investment value at Alborz Nab Arash Company also is among the top approved proposals in terms of investment value ($58.46 million). The company is active in blast furnaces and steel mills industry.

During the 6-month period, Turkish investors also have received permissions for investment in other projects in Iran including manufacturing molds for metal extrusion ($544,000), manufacturing compressed wood sheets (jointly with Azerbaijan, $9.664 million), manufacturing plastic caps ($44.3 million).

Proposals submitted by investors from Austria, India, Afghanistan, Switzerland, France, the UAE, South Korea, Iraq and Cayman Islands are also among the authorized projects.

According to the Iranian ministry, over 71 investment proposals (worth $5.06 billion) were approved by Iran's Foreign Investment Board last fiscal year (ended March 20). The value was $6.7 billion for the preceding fiscal year (ended March 2016), registering a big growth compared to $915 million in 2015, when the international sanctions against Iran were in place.

Following the removal of international sanctions, the Iranian administration is planning to hit an 8-percent economic growth in the post-sanctions era. Iran also made an announcement that the country is seeking to annually lure in up to $50 billion worth of foreign investment.

The United Nations Conference on Trade and Development’s (UNCTAD) statistics indicate that Iran attracted $3.372 billion foreign direct investment in 2016, compared to $2.05 billion in 2015.