Dubai business keen to get trade with Iran back on even keel

Dubai business officials show an undimmed appetite for trading with Iran.

Hamad Buamim is the director general of the Dubai Chamber of Commerce. ANTONIE ROBERTSON / The National

HAMBURG // Dubai business leaders’ appetite for trade with Iran remains undimmed despite the Dh40 billion estimated impact of sanctions, said Hisham Al Shirawi, vice chairman of Dubai’s Chamber of Commerce and Industry.

“The interests of our members have never relaxed when dealing with Iran,” said Mr Al Shirawi.

“What will determine the relationship with Iran is simple supply and demand. As long as the relationship persists, there will be trade.”

Hamad Buamim, the director general of the Dubai chamber, said: “We have always had strong economic relations and ties [with Iran], and geographically we are very close.”

Describing sanctions relief as meagre, Mr Al Shirawi said sanctions prevented Iran from using loans from the UAE’s banks to finance the purchase of imports – a major source of business for Emirati banks.

Instead, Iranians had been looking to black-market finance in Turkey, Azerbaijan and Malaysia to finance trade, Mr Al Shirawi said.

“Trade with Iran will never stop,” he added. “You cannot live in animosity with your neighbours forever. Iran exists, and we have relationships [with Iran] … that cannot be eradicated.”

The Dubai officials were in Germany for the Dubai-Hamburg 2014 Business forum last week.

Mr Al Shirawi’s remarks echo those made by Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai, in support of relaxation of sanctions, when he told the BBC, “Iran is our neighbour, and we don’t want any problem”.

Despite a breakthrough agreement in January to relax sanctions, traders in the UAE are yet to see the benefit of this, according to Mr Al Shirawi.

Around US$4.2 billion of frozen oil assets will become tradable under the terms of the deal. Mr Al Shirawi described this as “meagre”, pointing out that this entailed an extra $700 million of trade monthly, which would be shared between a large number of trading partners.

Sanctions on Iran’s financial sector remain in place under the terms of the January deal, as do restrictions on the amount of oil Iran is allowed to export, and some limitations on the trade of gold.

The United States and the European Union imposed sanctions on Iran in 2012, after signs that the country’s uranium enrichment programme, which could allow it to build a nuclear weapon, was accelerating.

On Friday, the Associated Press reported that Washington was temporarily waiving sanctions on Tehran’s state broadcaster. The move was meant as a confidence-building measure ahead of the next round of nuclear talks. The 180-day waiver would allow non-American companies to provide Islamic Republic of Iran Broadcasting with satellite services.

Iran insists that it is developing nuclear technology for peaceful purposes, although the International Atomic Energy Agency has said that it is unable to confirm that Iran’s nuclear programme is intended exclusively for energy production.