Italy, Rome: Yesterday, Iran President Hassan Rouhani flew to Italy at the start of his first official visit to Europe, looking to sign multi-billion dollar contracts to help to modernize Iran’s economy after years of financial sanctions. Heading a 120-strong delegation of Iranian business leaders and ministers, Rouhani will spend two days in Rome, then he will fly to France on Wednesday, hoping to burnish Tehran’s international credentials at a time of turmoil across the Middle East.
While diplomacy will figure high on his agenda, trade ties are likely to dominate the headlines, with Iran announcing plans to buy more than 160 European planes, mainly from Airbus, on the eve of Rouhani’s departure. Officials in Rome said Italian companies were poised to sign deals worth up to 17 billion euros ($18.4 billion) over the next two days, including in the energy and steel sectors. The deals will give a boost to Prime Minister Matteo Renzi, who is struggling to revive Italy’s underperforming economy. Rouhani wants to promote Iran’s position as a major regional player and key to any solution to the long-running conflict in Syria. He met first with Italian President Sergio Matterella, and was scheduled to meet later with Renzi and Pope Francis at the Vatican.
The President Rouhani told reporters just before his departure, “We have had friendly relations with Italy and France in the past and we want to continue our good relations with them”. The fight against Daesh, whose attacks on Paris forced Rouhani to delay a trip originally scheduled for November, and the war in Syria are expected to feature highly in diplomatic contacts during the visit. He also revealed that “important contracts” were in the works with French car makers Peugeot and Renault, adding to a burgeoning list of deals being struck as European companies scramble to get back into a $400-billion (370-billion-euro) economy with the fourth biggest reserves of oil in the world and a consumer market of 80 million people.
National carrier Iran Air said on Sunday it would be buying 114 Airbus planes to modernize an ageing fleet that has struggled to stay in the air as a result of the impact of sanctions. He is set to meet French President Francois Hollande in Paris on Thursday. “This is a very important visit,” said a senior Iranian official. “It’s time to turn the page and open the door to cooperation between our countries in different areas.” Among the deals being readied for Italy was a pipeline contract worth between $4 billion and $5 billion for oil services group Saipem, a source with knowledge of the matter said. Saipem was not immediately available for a comment.
In addition, Italian steel firm Danieli will sign commercial agreements worth up to $5.7 billion with Iran, a company spokesman said. These accords will include a joint venture with other international investors, to be called Persian Metallics, worth $2 billion. Iran’s Central Bank governor said last week the country was counting on the nuclear deal unblocking some $50 billion worth of foreign investment. Italian companies have been amongst the quickest off the blocks with a major business delegation having visited Tehran in November and some 500 entrepreneurs invited to a forum Rouhani will attend on Tuesday.