“As Bilateral Projects Prosper, Banking Activities Will Be More Highlighted in Iran,” States Portugal’s Deputy Foreign Minister

Jorge Costa Oliveira is the Portuguese Deputy FM who visited Tehran heading a high-ranking economic delegation to evaluate mechanisms for expanding bilateral political and economic ties. To gain a better understanding of his trip and with the help of Mr. Mario Damas Nunes, Portugal’s Ambassador in Iran to arrange an appointment, we carried out an interview with Mr. Oliveira which is as follows.

AVA Diplomatic’s Exclusive Interview with

Jorge Costa Oliveira, Portugal’s Deputy Foreign Minister

Interview by Mohammadreza Nazari

 What’s your main agenda and the highest priority during/in coming to Iran?

The main priority of my visit is to develop our friendly diplomatic relationship and increase the bilateral trade between our two countries. In fact, during my visit I am officially opening the new AICEP delegation (our foreign trade and investment’s agency) in Tehran which will support companies of both countries looking for investment opportunities and partnerships. As part of the efforts to promote business opportunities and our bilateral relations, we also intend to reinforce the capacities of our embassy in Teheran.

How much can lifting of the sanctions help enhance relations between Iran and Portugal?

It helps tremendously. Before the sanctions were lifted it was very complicated for Portuguese companies to cooperate with the Iranian companies. Now conditions are much better. That is what Portuguese companies tell me. They believe that there is a lot of potential for business and for partnership and they are very interested in a market of 80 million consumers In view of this incredible potential, several companies and different business associations joined me in this visit to Iran which is the first official mission after the sanctions were removed. Portuguese companies showed a great enthusiasm for joining the mission and this is a tremendously positive sign that bilateral relations can only improve after the sanctions removal.

What kind of banking situation exists between Iran and Portugal right now? Could Iranian banking system connect to that of Portugal’s?

There are two sides to this. One of it concerns the work that has to been done regarding the integration of Iranian banks work in the European system, like for example, the SWIFT system that exists in Europe. The second aspect is more complex and relates to inhibitions that banks have in Europe regarding the so-called primary sanctions by the US. In the case of the Portuguese banks, they traditionally follow Portuguese companies in their internationalization plans. . So if the Portuguese companies come here and manage to do business, I think that we will find the way to have financing coming with that.

European companies mostly are multinational companies. And as I know, Portuguese companies also are the same and other countries are investing and working beside them. Do you not think this issue can make the financial and trade cooperation difficult between Iran and Portugal?

I understand your question in general terms. Portuguese companies that are multinational have a lot of international experience and operate in different geographies, especially in Africa and Latin America. Portuguese companies are very adaptive so I don’t think that they will have difficulties specifically arising from the so called primary sanctions. Now banks have expressed some concern in those terms, but I believe that the part of that concern stems from the lack of coherence of statements made by US institutions. A consistent message would put way any hesitations that banks and financial institutions might have. But perhaps we can find other mechanisms like the introduction of a guarantees scheme that will facilitate banks getting more involved into financing investment here in Iran.

Does the Foreign Ministry of Portugal consult with the US Treasury Department about sanctions against Iran? What kind of guidelines did they propose?

Within the European Union, the negotiations with US Federal institutions are mostly done by the European commission. So we usually convey our views within European Union Council and then we will have a clear sense of what needs to be done. So I believe that this is what is being done today by Portugal and many other different European countries is to ask the Americans to be more precise and more clear so as to have the banks be less afraid of doing business in Iran.

What is the EU’s standpoint? What are the fields of interests of the delegations who accompany you on this trip?

Regarding the first question, I refer to my previous answer. Regarding the second question, in several fields like tourism and hospitality, in construction infrastructure including water management and waste management, healthcare and services. We also have experts on petrochemical fields in our delegation.

What kind of cooperation is going to happen with Iran in transportation and aviation?

We are trying to conclude an air transport agreement. The process is being conducted by the civil aviation authorities of both countries. And we are trying to do it as soon as possible. There is potential for strategic bilateral partnerships in this field and there is already at least one airline that wants to start the flights between Tehran and Lisbon. Perhaps three times a week. And we perceived that as a very important goal because it allows for increasing visitation not only to increase tourism in both directions but also catalyzing business visitation.

How much is the value of Portugal’s export to Iran and vice versa?

According to the International Trade Centre, in 2014 Iran exported to Portugal 73,900 million USD and imported from Portugal 53,600 million USD. It’s still very low and short of its full potential. I expect the numbers to increase in the coming years as a greater number of business delegations of Portuguese and Iranian companies visit both countries and fully explore the opportunities that exist for investment and partnerships. The new AICEP delegation in Tehran has key role to play in facilitating business bilateral visits. My visit is certainly the first of many Portuguese delegations to visit Iran because Portuguese companies in many fields have shown a great enthusiasm for the huge Iranian market. The petrochemical field, for example, has a lot of potential and I am looking forward for tomorrow´s meeting with the Iranian vice minister of oil.

Why does Portugal not buy oil from Iran right now, while Iran is trying to increase its production?

The previous sanctions regime stopped oil trade for a long period of time. Despite the interest of Portuguese companies and the opportunities that exist, it takes time to adapt in the petrochemical sector. Portuguese companies recognize the high quality of Iranian oil and we welcome exploring the full potential of this sector that should greatly increase our bilateral trade relations.

How much joint investment capacity is available between the two countries in automotive or heavy industries?

We still have to explore those possibilities in those sectors. Increased bilateral visits like the one I am taking now are certainly excellent opportunities to do exactly that.

Other ambassadors will read your interview. So what is the positive side of the political and financial relations between Iran and Portugal that can be a suitable pattern for diplomats?

I don’t think I know enough about Iran to give a fruitful reply to be honest. I think there is much to be learned and this is still my first visit which I hope will enhance our friendly bilateral relations in many fields and sectors while bringing mutual benefits to our countries.