Australian Spokesman: Tehran, Canberra ‘Looking for Trade Finance Pathways’

"It is up to banks and firms to make commercial arrangements and conduct all relevant due diligence. During (a recent visit to Iran by Australia’s Trade Minister Steve Ciobo and his accompanying business delegation), Australia’s Export Credit Agency, the Export Finance and Insurance Corporation (Efic) signed a Memorandum of Understanding (MoU) with their Iranian counterpart, the Export Guarantee Fund of Iran (EGFI) to cooperate on export finance. The Efic-EGFI MoU demonstrates that both sides are actively looking for trade finance pathways," the spokesman told the Tasnim News Agency.

Following is the full text of the interview.

Q: How does Australia’s trade office in Iran facilitate the bilateral trade? Does it play any role in ensuring Australian business sectors to work in Iran?

A: The Austrade office will assist Australian businesses find trade opportunities and foster closer commercial and investment ties. It will help Australian business navigate the market.

Specifically Austrade helps Australian companies to grow their business in international markets; promotes the Australian education and training sector in international markets; and provides coordinated government assistance to promote, attract and facilitate productive foreign direct investment (FDI) into Australia.

Q: Is there the possibility for Iran to establish a trade office in Australia? Has such a thing been discussed so far?

A: The specifics of Iranian agencies involved in trade promotion is a matter for the Iranian government. The Iranian Embassy in Canberra is involved in trade promotion currently. There are also a number of Iran-Australia Chambers of Commerce throughout Australia.

Q: How will banking transactions take place between Australian companies and Iranian counterparts?

A: It is up to banks and firms to make commercial arrangements and conduct all relevant due diligence. During the recent visit, Australia’s Export Credit Agency, the Export Finance and Insurance Corporation (Efic) signed a Memorandum of Understanding (MoU) with their Iranian counterpart, the Export Guarantee Fund of Iran (EGFI) to cooperate on export finance. The Efic-EGFI MoU demonstrates that both sides are actively looking for trade finance pathways.

Q: Is Australia planning to establish any banks in Iran to facilitate the bilateral trade with Iran?

A: Australian banks are privately run, so you would have to ask individual Australian banks this question.

Q: What will be the target trade volume between both countries in future? Is there any certain timeline for this?

A: Australia does not ascribe targets for its commercial relationships. As Mr Ciobo has said, Iran was Australia’s leading trade partner in the Middle East in the 1990’s. Additionally, two-way trade between Iran and Australia was valued in excess of AUD770m as recently as 2009 and there is no reason why, in time, trade could not return to these levels. 

Q: Apart from the exports, are there any investment projects on the agenda to take place in future?

A: Investment in Australia is led by the private sector. However, During Mr Ciobo’s visit, he concluded a Memorandum of Understanding (MOU) with Iran on trade and investment which provides the framework for broadening and deepening the economic relationship, as well as identifying several sectors such as agribusiness and food, resources and energy, health, water resource management, and education and training as priority areas.

Q: What type of cooperation specifically can happen between Iran and Australia on managing water scarcity? Can it include providing services only or establishing a branch of Australian companies in Iran or training the Iranian side and transferring the related technology?

A: The signing of a government to government Memorandum of Understanding on water management aims to build knowledge and cooperate on management of scarce water resources. This may include: technical training or seminars for capacity building of government staff, NGOs, or private sector employees; exchanges on each country’s experience with water sector reforms and governance; and encouraging collaboration between water companies and between relevant government agencies, for example. The delegation that accompanied Mr Ciobo also included several leading government and private sector water management figures.

Q: Does Australia include the considerations by the United States in its trade with Iran? Specifically, are there any concerns or worries by the Australian side and companies that their cooperation with Iran will face American criticism or even punishments?      

A: It is up to businesses to both understand the international sanctions landscape and make their own commercial decisions based on their calculation of cost-benefit and risk-reward, including reputational considerations. As long as no sanctions or other regulations or laws are contravened, Australian business should not face any disadvantage.