EghtesadOnline: Iran's sovereign state fund is ready to bankroll projects involving the export of goods and techno-engineering services to Latin American countries, announced the fund's director.
"The National Development Fund of Iran is able to provide credit to sellers and buyers, issue advance payment guarantee and finance the equipment of workshops in overseas projects of Iranian contractors," Ahmad Doust-Hosseini was also quoted as saying by IBENA.
He made the statements in a gathering of high-ranking officials from Latin American embassies based in Tehran.
Doust-Hosseini elaborated by saying that when an Iranian company wants to work on a power plant or a petrochemical project in the region, the NDFI can grant loans to the foreign company for buying the equipment from Iran.
"Should a registered company in a South American state wish to purchase goods from Iran and manages to open letters of credit through an eligible foreign bank for the Iranian beneficiary, the fund can pay the money to the Iranian seller in cash," he said.
The foreign buyer, he added, would pay back the amount within a year or two, adding that financing projects of four to five years would entail a "precise review of the project's details".
Doust-Hosseini noted that the fund does not allocate loans for the export of raw materials such as iron ore and crude oil.
However, he added, the NDFI would help by providing loans and finance to projects concerned with "steelmaking, petrochemical products, power plants, hotel construction, etc. outside the country".
According to the NDFI chief, funds will be allocated to buy equipment from Iran covering up to 85% of goods to implement the projects.
There is another caveat that "at least 60% of the value of the production must take place in Iran", he stressed.
Int'l Trade Rules
Doust-Hosseini further said NDFI will support Iranian export projects in Latin American countries within the framework of general regulations of international trade and export finance "that are currently being implemented in OECD countries".
The Organization for Economic Cooperation and Development is an intergovernmental economic organization with 35 member countries, founded in 1960 to stimulate economic progress and global trade, Financial Tribune reported.
"But under the current competitive circumstances and keeping in mind the conditions of Latin American countries, NDFI will consider more favorable conditions for these countries regarding exports from Iran," he said.
This week the parliament voted to raise NDFI's share of petroleum revenues to 30% for the sixth five-year development plan (2016-21), up from the previous 20%.
Based on the bill, the National Development Fund’s share of Iran’s crude oil, natural gas and condensate sales will increase by a minimum of two percentage points each year until the end of the plan.