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Sunday, February 25, 2024

Russia overtakes China as Iran’s top investor

According to a senior trade official quoted by an Iranian publication, Russia has surpassed China as Iran's largest investor.

Russia has become Iran’s largest foreign investor, Fars news agency reported on Sunday, citing the country’s deputy finance minister, Ali Fekri.

According to the official, Russia “had brought some $2.7 billion worth of investment to two petroleum projects in Iran’s Western province of Ilam in the past 15 months.” The figure accounts for some 45% of the total foreign investment attracted by Tehran over the period, Fekri noted.

The UAE, Afghanistan, Turkey and China were also among Iran’s biggest investors in the reporting period. However, Fekri noted that Beijing had notably reduced spending in 2022.

“China has invested nearly $185 million in Iran over that period, which we are not happy with given the amount of negotiations and meetings we had,” he stated.

Read More: Russia-Iran trade blossoming

According to Fekri, Tehran had set a target of $10.2 billion in direct foreign investment for the 15 months to December last year. It failed to reach this goal, having secured only $5.95 billion.

Iran and Russia boosted cooperation throughout 2022 in an effort find ways to bypass Western sanctions imposed on both countries. The two nations sealed a number of agreements expanding trade and concluded contracts on the joint construction of gas pipelines.

Total trade turnover between Moscow and Tehran surged by 15% last year, reaching $4.6 billion. Earlier this month, Iran and the Russia-led Eurasian Economic Union (EEU), signed a memorandum on free trade, which is also seen as a means of further strengthening ties between the two countries.

Direct link established banks

In accordance with the joint action plan of banking cooperation that the central banks of the two countries signed last year, the first step toward execution was made on Sunday, according to Mohammadreza Farzin, governor of the Central Bank of Iran (CBI (NS:CBI)).

The CBI announced on Sunday that Iran’s electronic financial messaging system, known as SEPAM domestically, and the Financial Messaging System of the Bank of Russia, known as SPFS, were connected following the signing of a deal between the two central banks on the same day.

RT story with additional input from Global Village Space News Desk.