US, Japanese, Chinese firms not leaving Qeshm FTZ – Iran official

Business Materials 12 June 2018 12:29 (UTC +04:00)

Tehran, Iran, June 12

By A. Shirazi- Trend:

Hamidreza Momeni, managing director of Qeshm Free Trade Zone (FTZ), said that the US-British firm is carrying out initial studies to develop a petrochemicals park in Qeshm.

“The firm [has signed a memorandum of understanding with Qeshm economic zone and] is carrying out preliminary studies over a petrochemicals park in Qeshm,” Momeni told the ILNA news agency on June 12.

He added that foreign companies have no plans to leave the Qeshm economic zone, following Washington’s decision to quit the 2015 nuclear deal between Tehran and world powers.

Two Japanese firms, as well as a South Korean company, are also cooperating with officials at Qeshm Free Trade Zone (FTZ) over different agreements covering a wide range of issues, including transportation and environmental preservation, Momeni said.

The Iranian government has also signed a major agreement with China in the petrochemical sector, he said, adding that the groundbreaking ceremony for the project is expected to be held on June 20.

The only issue that could be a source of concern for the firms is foreign currency as its transfer may not be possible due to government's new monetary measures, Momeni stressed.

Establishment of free trade zones in Iran dates back to Iranian calendar year 1368 (March 1989- March 1990), following the fall in the country’s oil income in the preceding year which prompted the government to promote the non-oil exports.

The first two free trade zones of Iran were established in the south of country. The first one was Kish Free Trade Zone established in 1368 on Kish Island in the Persian Gulf and the second one was Qeshm Free Trade Zone established the year after on Qeshm Island in the Strait of Hormuz.

Some five other free trade zones have been also established in the country since then, including Chabahar in southeastern Sistan-Baluchestan Province, Arvand in southwestern Khuzestan Province, Anzali in northern Gilan Province, Aras in East-Azarbaijan Province and Maku in West-Azarbaijan Province, both in the northwest of the country.

While near three decades have passed since start of free trade zones activity in Iran, their planned objectives have not been fully achieved and their development is still facing some impediments.

Lack of proportion between the facilities and the objectives, lack of a national definition for free trade zones’ performance, limited resources for establishment and completion of infrastructures, no comprehensive management between the zones, and not complete implementation of zones management law are some of the barriers in the way of free trade zones’ activity and development in the country.