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REGIONS ASIA-PACIFIC


WHAT IF IN FOURYEARSANOTHER REPUBLICAN PRESIDENT TURNS THE TABLE UPSIDEDOWN AGAIN?WEWILL TREAD CAREFULLY IN FUTURE


TheUSandIran: anewage? D


IT WILL TAKE MORE THAN A NEW PRESIDENT TO REATTRACT FOREIGN INVESTORS BURNT BY TRUMP. JACOPO DETTONI REPORTS


onald Trump’s Iran-baiting presidency may be about to end, butmany of the investors


who piled into the country following the 2015 nuclear deal remain cau- tious. However, a few are willing to test the boundaries under president- elect Joe Biden. “In the near and medium term


the opportunity is arguably bigger for financial investors than strategic investors,” Omid Gholamifar, CEO of


Serkland Invest, tells fDi. “Foreign industrial companies looking at


Iran will probably be even more hesitant this time around. Many companies have been com- ing and going... and newcomers would want to see a clear path ahead rather than being forced to leave again.”


First time unlucky In the wake of the Joint Comprehensive Plan of Action (JCPOA) signed by Iran and the P5+1 bloc (China, France, Russia,United Kingdom,United States – plus Germany) in 2015, a number of European companies rushed to announce pro- jects in Iran. Various heads of state used their political


capital to facilitate trade and investment with the country including then Italian prime min- ister Matteo Renzi. Mr Renzi spearheaded a dip- lomatic and business mission to Tehran in April 2016, where Italy’s state investment bank CDP issued €4.8bn in trade and investment guaran- tees. China, South Korea, Austria, Denmark, Italy, France and Russia also issued state credit lines worth billions of dollars to support pro- jects in Iran, encouragingmany foreign compa- nies to get involved. “We believed in [investing in Iran],” says


Stefano Falconio, head of business development at Carlo Maresca, an Italian company that


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joined trade missions with Mr Renzi. Carlo Maresca invested €8min a solar park that came online in 2018, while also obtaining permits for another two 100MWplants. However, the situation completely changed


following the election of Mr Trump. “Everyone [pledging government support]


disappeared,” recalls Mr Falconio. “Since then we’ve seen it all – sanctions, troubles with earn- ings repatriation, forex risk, inflation. Now with Biden we hope the situation will normal- ise, but we won’t build the other two solar plants.Whatif in four years anotherRepublican president turns the table upside down again? Wewill tread carefully in the future.” Foreign investors, mostly from Europe and


Asia, announced 91 projects worth $18.1bn between July 2015, when the JCPOAwas signed, and May 2018, when Mr Trump announced the US withdrawal from the agreement, according to foreign investment monitor fDi Markets. Very fewof the projects have come to fruition.


Hitting the lines Itmay take time and more robust guarantees to encourage strategic investors to return to Iran but some frontier financial investors have already taken the plunge. Swedish-based private equity Serkland


Invest has been investing in Iranian consumer goods and pharmaceutical companies since launch in 2017. “[Following Biden’s election], we have


started reaching out to people to be on the radar of those interested in investing in Iran,” says Omid Gholamifar, founder and CEO, Serkland Invest. “Most companies that want to be successful


in Iran need to invest and produce here, which often requiresmultinationals to buy local com- panies to get a foothold in themarket. [...]When things stabilise, a lot of local companies will be


www.fDiIntelligence.com December 2020/January 2021


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