Escrow Account

new-logoRestrictions on foreign investors entering the stock market was resolved by creating an ‘’Escrow Account’’

Managing Director of Mellat Bank stressed that the related account used for entering the money of foreign investors, is ‘’Escrow Account’’. He mentioned that, one of the main obstacles for foreign investors in Iran’s capital market is opening an account but with the implementation of the ‘’Escrow Account’’, the limitation of foreign investors for opening an account has been completely removed.
According to the ‘’Mellat Bazar’’, Hadi Akhlaghi managing director of Mellat Bank said, ‘’due to difficulties in opening an account for foreign investors Central Securities Depository of Iran and Mellat Bank signed a memorandum of understanding to facilitate the transfer of money for foreign investors. Based on this MOU, Mellat Bank from now on through an ‘’Escrow Account’’ take the responsibility of doing transactions of securities and commodities in all of Iran’s exchanges.’’
He said that one of the main problem of Iran’s capital market for attracting foreign investment was the impossibility of opening bank account but now with help of this memorandum foreign investors can transfer their money without opening account but through Mellat Bank branches.
He said that this MOU was signed with aim of developing Iran’s capital market in international field and to attracting more foreign investors and he mentioned that with this MOU, reception, membership and presence of Mellat Bank in CSDI has achieved.
He pointed out that for the purchase of shares, foreign currencies should be converted into Rial and by virtue of this MOU and by creating ‘’Escrow Account’’, the conversion process of foreign currency into Rial was successfully achieved through Mellat Bank.
According to director of Mellat Bank, those international customers who wish to invest in Iran’s capital market from now on can transfer their money through external brokers of Mellat Bank.
He responded to the question of how many branches cooperate for mentioned process with: ‘’three branches of Mellat Bank in Turkey, Saudi Arabia and UK are active and moreover other banks and brokers that are active in international level, can participate in this process’’.

Iran wants euro payment for new, outstanding oil sales

 

Iran wants to recover tens of billions of dollars it is owed by India and other buyers of its oil in euros and is billing new crude sales in euros, too, looking to reduce its dependence on the U.S. dollar following last month’s sanctions relief.
A source at state-owned National Iranian Oil Co (NIOC) told Reuters that Iran will charge in euros for its recently signed oil contracts with firms including French oil and gas major Total, Spanish refiner Cepsa and Litasco, the trading arm of Russia’s Lukoil.

“In our invoices we mention a clause that buyers of our oil will have to pay in euros, considering the exchange rate versus the dollar around the time of delivery,” the NIOC source said.

Lukoil and Total declined to comment, while Cepsa did not respond to a request for comment.

Oil market braces for Iran’s return

Iran has also told its trading partners who owe it billions of dollars that it wants to be paid in euros rather than U.S. dollars, said the person, who has direct knowledge of the matter.

Iran was allowed to recover some of the funds frozen under U.S.-led sanctions in currencies other than dollars, such as the Omani rial and UAE dhiram.

Switching oil sales to euros makes sense as Europe is now one of Iran’s biggest trading partners.

“Many European companies are rushing to Iran for business opportunities, so it makes sense to have revenue in euros,” said Robin Mills, chief executive of Dubai-based Qamar Energy.

Iran has pushed for years to have the euro replace the dollar as the currency for international oil trade. In 2007, Tehran failed to persuade OPEC members to switch away from the dollar, which its then President Mahmoud Ahmadinejad called a “worthless piece of paper”.

The NIOC source said Iran’s central bank instituted a policy while the country was under sanctions over its disputed nuclear programme to carry out foreign trade in euros.

“Iran shifted to the euro and cancelled trade in dollars because of political reasons,” the source said.

Envoy: Iran to grow rice, wheat in Africa

Iran is reportedly looking to lease land in Kenya, Uganda and Tanzania for large-scale food production to serve local and export markets.  

More than 10 Iranian companies have expressed interest in growing and processing rice, corn and wheat in East Africa, Iranian Ambassador to Kenya Hadi Farajvand has said.

He said Iran is supporting mechanized agriculture beyond its borders, with companies leasing huge chunks of land and applying modern agricultural methods to grow food for export to Iran.

The companies are willing to establish manufacturing plants in the region to cater to the local market and to export to Iran, Farajvand said.

The move is also aimed at narrowing trade deficit with the Horn of Africa countries, which is in Iran’s favor, he added.

The East African Community (EAC) mainly exports unprocessed agricultural products like tea, coffee and meat to Iran. It imports oil products, machinery and telecommunication equipment from the Middle Eastern country.

Local trade experts said the region should strive to export more processed goods to Iran, beginning this year.

“The lifting of sanctions on Iran will pave the way for EAC member states to forge closer ties with Iran, but we need to export value-added products if we are to tilt the balance of trade in our favor,” Peter Kiguta, director-general of Customs and Trade at the EAC, told the Geeska Afrika news agency.

The East African Tea Trade Association (EATTA) expects exports to Iran to grow five-fold in one year with the opening of the market, it said.

Farajvand said the biggest challenge in fostering stronger trade ties between Iran and the EAC countries is the lack of political will in the region and limited information on the available opportunities in Iran.

He said many products from Iran are imported into the region through other countries, making the final product expensive. These imports include oil products, bitumen, ceramics and electricity equipment.

Iran’s Agriculture Minister Mahmoud Hojjati has said the government had envisioned investment on 500,000 hectares of farmland in a number of countries to produce food.

Last August, Agriculture Ministry’s Mohammad Reza Shafeinia said Iran had launched agricultural cultivation in Kazakhstan, marking its first farmland investment overseas.

Water-intensive rice and corn crops as well as oilseeds and livestock inputs have been cited by Agriculture Ministry officials as the target products which Iran seeks to grow on farmlands overseas.

Iran is pushing for development of 60,000 hectares of land to cultivate agricultural products in Brazil, Hojjati has said.

Food prices are a key driver of Iran’s double-digit inflation which shot over 40% under former president Mahmoud Ahmadinejad.

Food security is a serious matter for Iran, given the size of its population which has grown over 80 million and seen its food basket grow smaller.

“Between 38-40% of the Iranian families’ economy is related to food which requires us to build a base for reducing prices of nutritional products and providing for facile access to them,” Shafeinia said.

President Rouhani Invites Bulgarian Investors, Entrepreneurs to Iran

“Implementation of the Joint Comprehensive Plan of Action (July nuclear deal between Iran and the world powers) has paved the ground for the further expansion of cooperation between Iran and the EU, specially Bulgaria, in economic, cultural and political fields,” Rouhani said during the phone talk on Wednesday.

“Iran is interested in the development of economic and cultural cooperation with Bulgaria and welcomes the presence and partnership of Bulgarian entrepreneurs and investors in our country’s plans and projects,” he added.

Plevneliev, for his part, invited President Rouhani for an official visit to Sofia, and said, “We are ready to provide the best conditions and possibilities for the Iranians in Bulgaria and we, specially, seek strengthening of trade and cultural ties with Tehran.”

Prior to the implementation of the nuclear deal last week, Bulgarian Foreign Minister Daniel Mitov paid a visit to Tehran in December.

During the visit, he described Iran as one of the most proper and important countries to meet the European Union’s needs to gas supplies.

“Iran is among the most important resources to diversify gas resources for the EU,” Mitov said in a joint press conference with his Iranian counterpart Mohammad Javad Zarif in Tehran.

“Bulgaria is the gate of entrance to the EU and Iran can play an important role in the energy sector,” he added.

Stressing that during his meetings in Tehran both sides have found important grounds for the development of relations, Mitov said, “We can take steps towards the expansion and deepening of ties through these fields.”

Thanks to holding world’s largest gas reservoirs, Iran has announced that it is studying a host of schemes for presence in the international and European gas markets in addition to exporting it to the neighboring countries.

Tehran Hopes Russia to Expand Investments in Iran

Tehran hopes Russia will expand its investment in different sectors of the Iranian economy after the international sanctions are lifted, Iranian Foreign Minister Mohammad Javad Zarif told Sputnik on Thursday.

“We’re looking for investment from Russia in a large number of fields,” Zarif said, adding that Iran and Russia have extremely good relations.

“We have good relations with Russia. Russia did not leave during sanctions. Russia is strategically placed in Iran right now in order to expand an economic cooperation,” he said.

IME monthly trade value hits $589 mln

 

TEHRAN (ISNA)- Iran Mercantile Exchange (IME) traded 1,420 KT of various commodities worth over $589 million in spot and secondary markets in December 2015.

According to the report from IME International Affairs and PR, 1,420 KT of different commodities were traded in domestic and export trading floors including 814 KT of various commodities worth more than $357 million in oil and petrochemical trading floor, 594 KT of different products worth approximately $226 million in metals and minerals trading floor, and approximately 12 KT of agricultural products worth $5.8 million in agricultural trading floor in the spot market.

Moreover, this month, the export trading floor witnessed trading of 161 KT of bitumen worth more than $45 million, 1.46 KT of insulation worth more than $0.52 million, 11 KT of sulfur worth more than $0.98 million as well as 220 KT of iron ore worth approximately $2.8 million.

In addition, IME experienced trading of 495 MT of products worth $115,564 in its secondary market during the same month.

It is worth noting, the derivatives market played host to the trading of $244 million gold coin futures contracts and $44,290 soybean meal futures contracts.

Presidential Aide: Iran Ensures Safety of Foreign Investments

“The European investors can be assured of  the favorable conditions for investing in Iran after the removal of the sanctions,” Nahavandian said in a meeting with a group of directors of the European banks in the city of Davos, Switzerland, on Friday.

He stressed that Tehran is committed to facilitate the conditions for the foreign investors.

In relevant remarks in late December, Iranian Deputy Foreign Minister for Europe and America Majid Takht Ravanchi said Iran supports signing contracts with foreign investors, specially in energy and petrochemical fields.

“We welcome foreign partnership and have provided opportunities for foreign firms in these areas,” the Iranian diplomat said in a meeting with members of the Slovenian chamber of commerce in Ljubljana.

“Iran’s geopolitical location facilitates cooperation in oil and gas, and transportation to other regional countries,” Takht Ravanchi said.