WIREDGOV

Last weekend, the British Embassy in Tehran was reopened, after nearly four years, by the Foreign Secretary, Philip Hammond. Simon Moore, CBI International Director, was privileged to be invited to join a small business delegation travelling with the Foreign Secretary, and reflects on the welcome they received, and where the opportunities lie for British business.

On the surface, a crowd gathering in a quiet Tehran suburb for the reopening of the doors of a historic villa might not draw much remark. Yet, these were not any old doors – they were the gateway to the British Embassy, closed for nearly four years after it was sacked - and new light was being let through them in what signified a momentous occasion.

The relationship between Britain and Iran has been far from plain sailing in recent decades. Iran has a complex relationship with the UK, well detailed in this week’s Economist article, and our role in Iran’s pre-Revolutionary history, particularly the coup of 1953, and the vigour with which the UK has applied sanctions, was raised several times.

Meanwhile, in an international context, the recent nuclear deal has not changed anything legally. As my note to members last month covered, it is true that the deal raises the possibility that nuclear sanctions against Iran might be lifted sometime over the next 12 months, but sanctions relating to terrorism and arms shipments, and a complex system of licencing, will remain in place.

And yet despite this, the overwhelming message our business delegation heard and experienced was that Iran wants to move forwards, putting its past with the British behind it - we were welcomed with genuine warmth and respect by everyone.  

Iran is a surprisingly interesting prospect for British business. English is widely spoken and understood, particularly in government circles, and there is a growing, western focused middle class. GDP growth is 3%, despite years of shrinkage, and the currency has stabilised. There is also a strong commitment to the private sector, with the state providing the legal and regulatory framework, on a model, that theoretically at least, UK business would understand.

So, where does Iran’s government think Britain can play a role? Besides energy, chemical and petroleum businesses, demand is particularly strong for infrastructure, from transport knowledge in roads, air and rail - interestingly, they want to model their railway on Britain’s railways - to water management and environmental services. Technology, financial services (including shipping finance and insurance) education, tourism and travel are also areas of interest, but retail and importing western consumer products is not currently a priority for the Iranian government.

In a nutshell, the government is interested in the import of technology and knowledge so that Iran can rebuild its economy as it recovers from sanctions and employs billions of dollars of capital currently trapped overseas.

The President of the Iranian Chamber of Commerce urged British business to “take a new look at Iran”. He said there is capacity to heal old wounds, with the understanding that the private sector will deliver the development of the economy in an Iran in 2015, which is very different to Iran in 2005, or even 2011.

The Economist headline implied that the UK has come late to the game. In a sense this is fair, but this isn’t a time to be committing capital. Rather, it’s an excellent time to be planning ahead in what could be a vibrant, strategic market. Our delegation was a first look at the country, and with plans for more in the next few months, these will be great opportunities for British companies to go and see for themselves what is going on.