December 26-2014
Seven major steel projects in Iran that are dependent on billions of dollars of investment from China have been delayed by financing issues, Iranian state-owned mines and metal holding company IMIDRO said last Tuesday.
The Iranian Mines and Mining Industries Development and Renovation Organization (IMIDRO) said it was working with China Metallurgical Group Corp. (MCC), itself a state-owned enterprise, to resolve the issues, which involve the Chinese central bank.
Local press reports in Iran said the MCC Group has secured 1.8 billion euros ($2.25 billion) of funding for the projects. There have been many news stories in Iran about massive Chinese investment in Iran. But those stories have rarely been published in the Chinese media.
Iran plans to boost steel output to 55 million tons a year by 2025 in a bid to replace at least a small part of the revenue lost to sanctions on oil sales, but industry experts say that target is ambitious. Iran’s output in 2013 was just 15.4 million tons.
Iran hopes to export 10 million tons a year by 2025, up from an average of 1.35 million tons a year in 2011 and 2012. Iran has never been barred from selling steel under US and EU sanctions.
But the Islamic Republic is subject to financial restrictions banning banks from processing dollar payments for trade with Tehran. IMIDRO did not make clear if the financing problems with MCC were linked to sanctions.