The cream of French industry and politics are launching a bid to forge business links with Iran ahead of the lifting of international sanctions on the country.
A delegation of France's main business lobby group, Medef, comprising about 130 firms, including top companies such as Total and Peugeot, arrived in Tehran Monday with the aim of encouraging future trade deals.
The delegation was also be accompanied by trade and agriculture ministers, making it the first visit to Iran by a foreign trade minister or a minister responsible for a French economic sector for 12 years, according to the French foreign ministry.
Sanctions imposed on Iran for its alleged nuclear arms development are expected to be lifted after a deal between the country and global powers that will see Iran allow international monitors to ensure its nuclear program is peaceful.
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Tehran, Iran
Despite opposition to the deal from U.S. Republicans and Israel, the sanctions could be lifted by next spring if Iran meets its side of the deal. If Iran becomes open to business, foreign firms prevented from investing or trading with the country during the embargo would be allowed back in to strengthen trade ties.
The trip is well-timed ahead of a visit by Iranian President Hassan Rouhani to Paris in November. There are hopes that Medef's trip can restore business relations between Iran and France – a country which took a tough line on Iran during nuclear discussions.
During the talks, French Foreign Minister Laurent Fabius said the tough stance wouldn't hurt trade but business leaders have expressed concerns that trade relations could have been damaged.
"The very tough stance has created some aggressive thinking vis-à-vis France and everything that represents France, like our company," Carlos Tavares, the chief executive of PSA Peugeot Citroen, told the Financial Times newspaper.
Meanwhile, French oil giant Total, which operated in Iran until it was pressured to stop all oil production there in 2010, looks set to develop Iranian oil fields again. In July, Iranian Oil Minister Bijan Zanganeh said: "Total was active in developing Iranian oil projects for more than 20 years (before sanctions)... the door is again open for this company's activities in developing oil fields."
Foot in the door
Announcing the trip to Tehran earlier this month, Thibault de Silguy, vice-president of Medef, said France needed to restore trade relations so that it would not lose out to Asian and other European countries once sanctions are eased.
"We have fallen behind, so now we have to make up lost ground," Medef Vice President Thibault de Silguy told reporters earlier this month, saying the visit was "very important for us."
Among the delegation will also be small- and medium-sized enterprises with sectors as wide-ranging as agriculture, finance, luxury goods, pharmaceuticals, construction and transport, according to Radio France Internationale.
According to European Commission statistics for 2014, the export value of goods from France to Iran totally almost 453 million euros ($510.5 million), whereas the import value from Iran was worth just over 29 million euros.
A decade previously, however, and French exports to the Islamic republic peaked, valued at 2.3 billion euros, showing the steep decline in exports decreased and why France might be so keen to restore those relations.
France could well do with an economic boost amid a sluggish growth environment back home. On Friday, Moody's ratings agency lowered France's sovereign credit rating by one notch to Aa2 and changed its outlook from "negative" to "stable."
It made the change due to the "the continuing weakness in France's medium-term growth outlook, which Moody's expects will extend through the remainder of this decade," it said in a statement, as well as "the challenges that low growth, coupled with institutional and political constraints, poses for the material reduction in the government's high debt burden over the remainder of this decade."
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