Money, the biggest hurdle
With all the rejoicing about the return of the foreign countries, it warns us about great expectations: The Iranian industry is weak. President Hassan Rohani’s policy of “Change though trade” groans under the legacy left behind by his predecessor Mahmud Ahmadineschad. Government debt of more than 70 billion US Dollars and an inflation rate of 40 % and the clear depreciation of the Iranian Rial “has almost tripled prices of a small car of Saipa”. As a result, the sale collapsed almost as dramatically as the prices of oil, the second crucial source of revenue of the Iranian industry.
“The embargo has ended for the foreign countries”, Barzegari calls another aspect into play, “but not yet for the Iranians”. He goes for additional difficult financial transaction. German banks still do not acknowledge the Letter of Credit (LEC) for fear of the American penalties; further, the payments must be redirected across third countries in the Arabian world. So many obstacles, less chances, Mr. Barzegari? “Anyway. The domestic economy is compelled to modernise due to pressure from foreign products.”Especially the automobile industry has to make up for a technological stagnation of several decades.
Will Made in Germany lead the way?
Friedrich Wölfel, Head of Department of Automotive at Kapp Niles bets on it. “There was one customer today who wants to establish a strategic positioning with our gear grinding machines– as one of the firsts, who produces with German technology.”Even at the time of launching one relies on the effect of “Made in Germany”, although the Chinese parent group, the Shenyang Machine Tool Group has catered even during the embargo in Iranusing its affiliated group SMTCL. “But those were machines with rather very simple technology”, stresses Managing Director, Xin Guan. Now the specialist for machining centres can strike out again with its machines for the manufacturing of wind mills or turbines.
Anton Gruber is not afraid of the Chinese key players. As one of the few exhibitors, the Sales Manager at FPS Werkzeugmaschinen brought along a machine. It cost him around 5000 Eurosto transport his milling machine FPS 500 M. “But if I want to sell a machine for 75,000 Euroshere, then I must show the performance gap to the Chinese suppliers”, he is convinced of market opportunities.
Risk with Donald Trump
This is the reason why VDW and Stuttgart Trade Fair want to bring “more machines and more exhibitors” in Iran next year from 23rd to 26th May in smart, new exhibition grounds in Schahr-e Aftab, the “City of Sunshine”. German organisers and the Iranian Association Satsa have recently signed a Memorandum of Understanding. Thereby it did not deal only with AMB Iran 2018, but also with potential professional exchange programmes.
The exhibitors and also the economic leaders agreed that a dark cloud hovers over all the spirit of optimism. If Donald Trump wins the American presidential elections then even the religious hardliners in Iranian politics will gain new popularity. Then the “Change through trade “is seriously jeopardised.