Iran Press/Iran news: With a population of over 1.4 billion people living in 54 countries, Africa is home to more than 18% of the world's total population; a young and growing population that can provide countries with a lucrative market and cheap labor.
The desire to obtain trans-territorial resources, initially by identifying precious metals and strategic mines, has led many countries such as Iran, China, India, Turkey, etc. to strengthen cooperation with the continent.
On December 22, a group of businessmen active in oil, gas, and petrochemicals gathered in the joint Iran-Africa Chamber in Tehran to discuss the Islamic Republic of Iran's capacities of cooperation and investment in Africa.
Efforts were made in the meeting to have the private sector, government, and university present to achieve synergy through dialogue and understanding of capabilities, facilities, and existing challenges in this field. Therefore, relevant figures from the Iranian Ministry of Oil, such as the Deputy Minister for International Affairs and Research Studies, as well as the Oil and Products Exporters Union, and the Energy and Transportation Commission of the Chamber of Commerce were present.
Masoud Barhaman, The Head of the Iran-Africa Joint Chamber, referred in the meeting to the increasing importance of the African continent for developed countries and said that the continent has envisioned a development program until 2063, yet other countries' interest in entering this market indicates that the program will yield results much sooner than that.
He mentioned China as an example and highlighted its $147 billion financial activity in the continent, stressing that to achieve success in the continental market group work is required and the private sector should be the leading sector.
In 2023, economic exchanges between Iran and Africa saw significant developments. Iran has been actively working to strengthen its trade relations with African nations, despite facing international sanctions. A key highlight was the second Iran-Africa International Summit, which aimed to foster equitable partnerships and shared prosperity. Iranian President Ebrahim Raisi's visit to Africa also underscored the importance of consolidating economic ties and exploring new opportunities for cooperation.
Iran-Africa Trade Challenges
The trade between the Islamic Republic of Iran and Africa faces such challenges as transportation. In this respect, Ali Abbasi, a member of the chamber and the Iranian Union of Oil, Gas, and Petrochemicals Exporters, said that the problems in transportation have not limited to the extensive presence of other countries in Africa.
Abbasi pointed to the lack of a proper transportation system to Africa and continued: the high freight rates have caused Iranian goods to be unable to succeed against competitors. He also considered the long transportation time as another problem, the continuation of which will lead to the loss of the African market.
Abbasi pointed to the lack of a proper transportation system to Africa and continued: the high freight rates have caused Iranian goods to be unable to succeed against competitors. He also considered the long transportation time as another problem, the continuation of which will lead to the loss of the African market.
Sanctions and the lack of financial exchange between Iran and Africa, lack of familiarity with the African market, and inadequate presence at exhibitions in the African continent are of other problems.
Despite the challenges, Iran sends 300,000 to 400,000 tons of Ura to Africa as well as oleochemistry to Africa.
Current Exports
Iran's current exports to Africa include a variety of goods, with a significant portion being non-oil products. Here are some key highlights:
Non-Oil Goods: Iran's non-oil exports to Africa have been growing, reaching $43 billion in the first nine months of the current Iranian calendar year (March 21, 2024 - December 22, 2024). This category includes petrochemical products, which saw a notable increase in both weight and value.
Main Export Destinations: South Africa, Mozambique, and Sudan are among the top destinations for Iranian exports. South Africa alone accounted for $247.62 million worth of imports from Iran during a recent period.
Total Trade: Iran and African states exchanged nearly $1 billion worth of goods in just seven months of the current Iranian year.
Iran continues to explore new markets and strengthen its trade relations with African countries despite facing international sanctions and other challenges.
The Deputy Head of the Union of Exporters of Oil, Gas, and Petrochemical Products in Iran Hamed Hosseini said in the meeting if the issue of transportation was solved, Iran would make an effective presence in the continent to boost exports and earn more currency.
Expanding Petro-Exports Scope
The Deputy Head of the Office of Africa, Trade Development Organization Leila Baghban, reminded the attendees in the meeting of the fact that other than oil, gas, and petrochemical products, efforts should be directed to export engineering services in this regard.
As an example of exporting these services to Africa, Nigeria could be mentioned. Iran has signed a memorandum of understanding (MoU) with Nigeria to export technical and engineering services, including the development of oil and gas fields, liquefied natural gas (LNG) production technology, and the CNG (compressed natural gas) industry. This cooperation aims to leverage the high capacities of both countries in the field of crude oil export and LNG production.
Iran is also exploring opportunities to provide similar services to other African countries, focusing on the transfer of technology, modernization of refineries, and development of oil and gas infrastructure.
The presence of the world's great countries like the US, China, and France for trade in Africa means that Iran must compete with these countries, an issue that necessitates the essential requirement to pave the way for Iran.
The Secretary General of the Union of Exporters of Oil, Gas, and Petrochemical Products in Iran Freidoun Asadi said in the meeting: "83 billion dollars have been invested in Africa, a large part of which has come from China and the United States; therefore, our entry into these [African] countries is accompanied by competition with these major countries."
As he says, Iran does not even have embassies in many of these countries.
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