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Dr. Askari's Speech in the Opening Ceremony of the Iran and Cyprus Joint Chamber of Commerce

  1. Welcome everybody. 

Dear participants, high ranking officials, respected businesspersons, ladies and gentlemen.  

Hello and good day.  

Before anything else, on behalf of the IRI government, I would like to express the sincere thankfulness of my people and the IRI State for the kind invitation made by the Republic of Cyprus for this occasion.  We are thankful for the valuable and warm hospitality of our friends in Nicosia.  

Today shall remain as the turning point in the history of economic mutual relations between the two countries and nations of Iran and Cyprus. I am happy to remind in this friendly occasion that Iran has been one of the pioneering countries in immediately recognizing the independency of the historical land of Cyprus in 1960, which paved the way for the start of mutual relations.  

  1. Iranian Economic Status.

The potential economic capacities of Iran in different sectors, forms a suitable platform for the development of commercial relations with the countries of the world.   It should be further recalled that Iran is the only country in the Middle East that enjoys an outstanding geographical position.   These merits accompanied by the existence of political wills of the two countries, different investment capacities in Iran and the particular status of Cyprus would create suitable opportunities in the way of development of commercial relations between the two countries.  In this relation, a reference is made to the economic capacities of Iran in the energy, industry, mining, agriculture and services sectors.   In the energy sector, in view of the great reservoirs of oil and gas, Iran may be one of the potential and reliable partners for other countries with great investment opportunities. In the industry sector, Iran is one of the best foreign investment targets in different areas of industry, including chemical and petrochemical, automobiles, metal industries, medical and pharmaceutical, as well as other industries.   Existence of different mining reservoirs in Iran, including metal and nonmetal ones throughout the Country, with international pioneering positions in some of them, creates a suitable area for economic cooperation between Iran and other countries.    Taking into account different types of weather conditions in the Country, Iranian agriculture enjoys several potentialities for growth and development.  In the service sector, Iran has one of the largest markets in the region.  The young society of Iran and the great ecotourism capacities of the Country create great investment opportunities for the IT and tourism areas, respectively.   The area of goods and services commerce, moreover, creates a suitable platform for the development and promotion of economic relations between Iran and other Countries.  In 2014, in spite of the international limitations, the IRI managed to receive an FDI exceeding 2 billion dollars.  Taking into account the recent nuclear agreement and the removal of sanctions, during the upcoming years, we expect to witness a considerable promotion in this regard.   In sum, as the 18th largest economy in the world and enjoying considerable capacities, having a 78-milliion people market, the GDP exceeding 400 billion dollars (approximately 1.35 trillion dollars based on the purchasing power parity criterion) and the size of foreign trade exceeding 100 million dollars, with its geographic strategic position, Iran may function as the gateway for entry of tradespersons from other countries to the vast markets of countries like Iraq, Turkmenistan, Azerbaijan, Afghanistan, and Middle Asian countries and may be considered as a highly attractable opportunity for investors.  

Fortunately, diplomatic relations between the two countries was promoted after the revolution and reached to its highest point during the recent years.   The establishment of Iran-Cyprus Parliamentary Friendship Group, development of mutual parliamentary friendship, establishment and continuous operation of direct flight lines between the two countries, signing of common trade MOUs between the chambers of commerce of the two countries, development of mutual tourist relations, are all indicative of the friendly and deep relations between the two historical nations and countries of Iran and Cyprus. 

 

  1. Trade Exchanges Volume between the two Countries

One of the other important issues is the existence of significant potential capacities for the cooperation between Iran and Cyprus.  The scope of trade exchanges between the two states was 145 million dollars approximately, which indicates that the capacities have not been exploited completely and there are several areas for the development and expansion of economic relations between the two countries.  

 

  1. Effective Mechanisms in the Development and Promotion of Trade Relations between the two States:
    1. Concluding of Mutual Agreement for the Avoidance of Double Taxation Treaties:

In view of the facts that tax has a quite significant role in the establishment of investment incentives and targeting economic activities, and that tax is one of the most important tools in the application of financial policies of the states, it is clear that cooperation and coordination in the tax policies, particularly for the avoidance of double taxation, is one of the requirements for the development of economic cooperation between the two States.   Hence, the IRI has concluded DTAs with several countries, Cyprus being the 54th country with which Iran has signed a DTA.  The Iran-Cyprus DTA has been drawn up in 28 articles and a Protocol, to decide on the manner of taxation from different types of income of residents of such countries and the avoidance from the double taxation from such residents.   This DTA shall provide an unprecedented opportunity for the Iranian and Cypriot tradespersons and shall form a significant event in the facilitation and promotion of transborder trade between the two countries.  

 

  1. Tax Incentives

In view of the IRI tax laws, various tax exemptions and incentives have been granted to investors and economic players in different industrial, agricultural and service areas, for long periods and in many cases, without any time limitations.   It is mentionable that for particular tax incentives and exemptions purposes, there are no tax differentiations between foreign and Iranian investors. It means that foreign investors are entitled to the same supports and benefits enjoyed by the Iranian investors.  Some of the most important tax exemptions include:

  • Activity

Scope of Exemption (percent)

 Exemption Period

Agriculture

  1.  

Unlimited

Industry and Mining

  1.  

4 years

Industry and Mining in Deprived Regions

  1.  

20 years

Tourism

  1.  

Unlimited

Exportation of Non-oil Goods and Services

  1.  

During the 5th Development Plan

Handicrafts

  1.  

Unlimited

Educational and Sports Services

  100

Unlimited

Cultural Activities

  1.  

Unlimited

Salaries and Wages in Deprived Regions

  1.  

Unlimited

All Economic Activities in Free Trade Zones

  1.  

20 years

 

  1. In the current economic situation of the two States, the establishment of Joint Chamber of Commerce of Iran and Cyprus is one of the main requirements.   Naturally, the Chamber shall take the important responsibilities policy making and facilitating the growth of economic development criteria and business activities. Undoubtedly, the establishment of Joint Chamber of Commerce may strengthen the development and promotion of trade relations between the two Countries and make it stable.  Establishing a platform for the provision of consultation services to the tradespersons and businesspersons, the Chamber shall also pave the path for the practical application of legal supportive instruments, such as the mutual DTA, and may duly assist the Iranian and Cypriot tradespersons in significantly exploiting the benefits of the aforesaid Agreement. 

Finally, taking into account the opportunities and potentials, as well as the existing political will in the two Sates, we hope that with the removal of the sanctions shadows, the business and economic exchanges are promoted, the mutual working relations are expanded and the mutual investment of the two States are developed.  

Now, I prevail the opportunity to express my sincere wishes for the success of the Joint Chamber of Commerce of Iran and Cyprus.  I hereby express my gratitude towards all the individuals and highly respected authorities and officials of both countries, who contribute to the promotion of friendly relations between the two States and nations, including also the efforts made by the IRI Embassy in Nicosia, the Republic of Cyprus Embassy in Tehran and the Joint Chambers of Commerce of the two Countries.  I wish God the Almighty brings about sustainable success and honors for the two nations of Cyprus and Iran.    

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