JULY 16 2015 (The Conway Bulletin) – Governments across Central Asia and the South Caucasus welcomed a deal between the West and Iran over its nuclear programme that will allow sanctions on Tehran to be lifted, boosting their southern neighbour as an important trade partner once again.
Sanctions have weighed down Iran’s economy since 2002, stunting demand and undercutting its value to the region.
Central Asian and South Caucasus countries have legally been able to trade with Iran during the Western-imposed sanctions, but Iran’s economy had faltered. They now hope that, unshackled, Iran can generate wealth and demand throughout the region once again.
“It will have a positive impact on the economic and social development of all countries in the region, and will further strengthen the cooperation between Kazakhstan and Iran,” Kazakh foreign minister Erlan Idrissov said of the deal with Iran.
From Dushanbe to Yerevan, these sentiments were echoed across the region.
Georgia’s foreign ministry said in a statement: “(This) deal brings about normalisation of relations between Iran and Western countries, which will create new economic opportunities for countries both in the region and in the entire world.”
Iran has, over the past few years, been increasing links with both Central Asia and the South Caucasus.
In Azerbaijan it patched up a row over spying, in Georgia new regulations have allowed Iranians to set up businesses and Armenia has been busy making plans to increase trade with one of its few regional allies.
Its a similar story in Central Asia where ties with Iran are being improved and strengthened through new train links and product swaps.
And Iran’s economic impact on the region is significant. The ArcelorMittal steel factory at Temirtau in central Kazakhstan, for example, has long complained that sanctions on Iran severely dented demand for its steel.
With sanctions soon to be lifted and Iranian domestic and industrial demand primed to rise, Central Asia and the South Caucasus should benefit.
ENDS
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(News report from Issue No. 240, published on July 16 2015)