Reporting "Asre Khodro", Ali Tayyebnia, Iran's economic affairs and finance minister, on Thursday discussed opportunities for foreign investment in Iran and the government's economic plan in an interview with The Nikkei.
While the steep decline in oil prices has clouded the near-term economic prospects of the oil-producing nation, the lifting of economic sanctions by the West should help the Iranian economy, Tayyebnia said. Iran is hoping to achieve inflation-adjusted growth of 8% in its gross domestic product this year. Many analysts estimate the growth rate will be around 6%, he added.
Iran is now drawing up its sixth five-year economic plan, which will begin next year. Tayyebnia said the Islamic Republic is placing priority on petrochemicals, electricity, water resources, autos and tourism. It is looking for overseas investment and cooperation in these areas.
The lifting of sanctions last month will allow Iran to increase its oil exports by 1 million barrels a day, Tayyebnia said. The country is considering raising its output by 500,000 barrels a day in the first half of this year, and another 500,000 barrels later, while monitoring developments in the oil market.
The minister said the Iranian government will promote public-private partnerships with foreign companies in the power-generation industry. Iran will "generate and sell electricity to markets, including neighboring countries," by drawing on domestic and foreign investment, he said. Tayyebnia said Iran is suffering from chronic water shortages, and is seeking Japanese investment and assistance in water purification projects in the Persian Gulf and in irrigation.
Iran offers significant opportunities for automakers, with a market of more than 70 million people. It can also serve as an export base to neighboring countries in Central Asia and other areas, Tayyebnia said. French automakers are rushing to strike major deals, with Peugeot planning to form a 50-50 joint production venture with Iran Khodro, an Iranian automaker. Renault is expected to forge a similar alliance with SAIPA, another Iranian carmaker, "maybe within this month," Tayyebnia said.
He called on Toyota Motor and other Japanese automakers to actively invest in Iran and transfer their technology. He said he wants to see Japanese automakers invest in Iran as much as or more than their French rivals.
Under the terms of the nuclear accord recently signed with six major powers, including the U.S., Britain and France, Iran is expanding its crude oil exports and has regained access to frozen assets. In return, it has pledged to sharply curb its nuclear program.
The deal has significantly brightened the country's economic prospects. Chinese President Xi Jinping, recently visited Iran, accompanied by a large delegation of business executives.