Feb 16, 2019, 8:45 AM
News Code: 83210601
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Finland: INSTEX to bring back European SMEs to Iran

Tehran, Feb 16, IRNA – Finnish Ambassador to Iran Keijo Norvanto hailed E3 initiative to register the Instrument in Support of Trade Exchanges (INSTEX) with Iran saying it will help European small and medium-sized enterprises (SMEs) to return to Iran.

Following the US' withdrawal from Iran nuclear deal, the EU took stance against the move by devising plans to help preserve the international pact.

By implementing the Blocking Statute, the EU companies’ compliance with the US foreign sanctions was annulled.

Earlier in a news meeting in Bucharest, German, British and French foreign ministers officially announced the commissioning of the European special financial mechanism, known as the INSTEX.

Speaking in an exclusive interview with the Islamic Republic News Agency (IRNA), Norvanto said, 'When the INSTEX is fully operational, I personally believe that European small and medium-sized companies will consider their return to Iran in a positive way.'

'They also need level playing field, as they are very sensitive to trade barriers and other market access challenges,' he said, adding that the number of Finnish companies returning to Iran is not clear yet.

Elaborating on the Finland's position toward INSTEX, he said, 'We welcome the INSTEX, which is an example of EU’s commitment to the JCPOA and its implementation.

He added, 'There has been a long delay in setting up the mechanism, but I personally believe, that in the future, INSTEX will improve the situation and it will facilitate trade and benefit both Iranian and European companies and customers.'

In response to a question whether Finland has any plan to join INSTEX, Norvanto said, 'We are waiting for more information on the arrangement and on the corresponding Iranian trade exchange arrangement. After that, we will decide on our participation, based on the interest shown by Finnish companies.'

Commenting on other measures taken by Finland to preserve ties with Iran, Finnish envoy said, 'We are in close contact with Finnish companies on a regular basis. We do our best to share information of the business and investment opportunities in different sectors, as well as advise them on rules and regulations here in Iran.'

'We can help and support, but in a market economy companies always decide on their business operations, especially when the companies are private, exchange-listed enterprises, and not state-owned enterprises,' he reiterated.

Elsewhere in his remarks, Norvanto referred to Iran nuclear deal also known as the Joint Comprehensive Plan of Action (JCPOA) as a key element of the global nuclear non-proliferation regime which has contributed to regional security, saying, 'Finland together with our European partners is fully committed to the JCPOA, and we encourage Iran to continue full and effective implementation of its nuclear-related commitments.'

'We deeply regret the US withdrawal and the re-imposition of US sanctions,' he noted.

For much of the interview, Finnish diplomat referred to the volume of trade exchange between Iran and Finland, saying, 'In terms of trade volumes, we have seen a rapid increase in our bilateral trade since 2016.'

'For example during last year exports from Finland to Iran reached €132 million and imports from Iran €3,7 million. Unfortunately, this extremely positive trend stagnated towards the end of 2018, for obvious reasons,' Norvanto noted.

Underlining the importance of removing the existing obstacles for investment, he said, 'Doing flourishing business requires supply and demand, which are already there.'

'Companies need also stable and predictable business environment and above all, reliable banking channels,' he noted.

He went on to say that based on Finland's experiences, 'private sector enterprises of different sizes play a major role in creating jobs and wealth. The question is how to create incentives and remove existing hurdles, in order to promote sustainable economic growth.'

Pointing to the area in which Iran and Finland have interactions, Norvanto said, 'Finnish companies have been active in the fields of energy, paper and pulp, mining, timber, engineering and heavy machinery like lifts and elevators,' adding that missing banking channels are the biggest challenge in trade ties.

'Companies, which are active in the US market, have major challenges with sanctions re-imposed by the US, as we have seen,' he reiterated.

He noted, 'We have identified a great potential in environmentally clean technology, agriculture and food processing industry, as well.'

*Ali Izadi is a staff member of IRNA English news

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