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The trend has been a clear since 2016. The easing of sanctions along with the nuclear energy deal has created new possibilities for Swedish companies to trade with Iran. Swedish exports to Iran are increasing, primarily short transactions with a credit period of up to one year. Even if the European banks remain cautious, EKN’s experience has been that payments work well, and Iran has, what is more, paid off its previously outstanding debt to EKN.

At the same time, the uncertainty surrounding the USA and the nuclear energy deal is a source of concern for the future. The USA recently extended the nuclear energy deal by 120 days, but also made reservations for this being the last time they would do so. The Trump administration is against the deal and the USA recently introduced new sanctions against companies and individuals. Despite this, EKN has recently upgraded Iran from country risk category 6 to 5.

“The reason for upgrading Iran is that EKN, and other export credit institutions, have had a better payment experience of Iran. They have now more or less paid off the debts they incurred under the sanctions. The Iranian economy is doing better and their oil exports are increasing, primarily in Asia, along with a rising oil price. The main risk is new sanctions against Iran from the USA,” says Victor Carstenius, EKN’s country analyst for Iran.

What should Swedish companies bear in mind?

“If you want to trade with Iran, you should first of all be aware of any EU sanctions that you have to comply with. If you have any American ties to your business, you should also be aware of American sanctions. Then you need to get a bank to agree to the transaction, of course, which is not the easiest thing to do. You have to be prepared for changes in the coming years, and it may become necessary to discontinue your trading in Iran if sanctions are introduced.”

EKN is the most active in Iran out of all the European export credit institutions. Why is that?

“Up until Q3 of 2017, EKN had, out of all the European export credit institutions, made most new transactions in Iran, and the reason is that we have a couple of Nordic banks that are interested in doing business there. We also have Swedish exporters who have previously established business relationships in Iran. After the easing of sanctions, they were able to quickly pick up their activities again.”

Are Swedish goods exports to Iran on the rise?

“Yes, they increased by 94 per cent in January–November 2017, compared to the corresponding period in 2016. From SEK 1,976 million to SEK 3,829 million. But it is still far from what they were before the sanctions in 2012. So we have a long way to go to reach the potential that exists. But, our experience is still that the new business is going very well – without a hitch in fact.”

What is on the road ahead?

“In terms of Swedish export promotion, there is still a hope that the nuclear energy deal will remain in place and that more European banks will start to do business with Iran, so that more companies gain access to the Iranian market. Iran for its part also needs to take certain measures, such as creating better transparency and better regulation of the banking sector in order to facilitate the return of foreign companies and banks to Iran.”

What is Sweden’s position?

“Sweden and Europe support the nuclear energy deal and have made fairly strong statements expressing their opinion that the deal is an effective means to control Iran’s nuclear programme.”

What would be the best future scenario?

“For the easing of sanctions to continue and for the USA to remain in the nuclear energy deal. Iran’s economic development depends on it – their exports will otherwise be limited and it would also affect their banks.”