Iran unable to export petchems to EU due to banking problems

By Azernews

Iran’s petrochemical export to Europe is facing problems due to banking problems, Fariborz Karimaei, deputy head of Iranian Association of Petrochemical Industry Corporation, said.

Some eight months pass from removal of international sanctions, but banking problems are not fully settled, Karimaei said, Mehr news agency reported Aug. 13.

He referred to lack of cooperation from European banks as main obstacle ahead of Iranian petrochemical products’ export to Europe.

All Iranian petrochemical products have obtained necessary certificates form the EU, including REACH (Registration, Evaluation, Authorization and Restriction of Chemicals), he said, adding that shipping and insurance problems have been resolved as well.

REACH addresses the production and use of chemical substances and their potential impacts on both human health and the environment.

Karimaei further said Iran has a potential to export 2-2.5 million tons of petrochemical products to the European countries per annum, which is equal to 10 to 13 percent of Iran’s petrochemical output.

Earlier, Karimaei said Iran’s attempts to regain the lost share in the European countries’ petrochemical markets will not be so easy.

Iran rapidly lost its 12.5 percent export share in the EU petrochemical market due to sanctions, meanwhile the figure has revived only to 0.5 percent following the removal of sanctions in January, Karimaei said last June.

“The process will not be that easy and years will be needed for Iran to return to the point left under the sanctions,” he said.

He further said Iran and the Saudi company Sabic are competing over the European petrochemical market.

Iran’s petrochemical output capacity currently stands at 61 million tons. The Islamic Republic hopes to bring this capacity to 120 million tons by 2020 and 180 million tons by 2025.

Petrochemical plants in Iran had to operate below the actual production capacity due to the shortage of natural gas as feedstock, old production units, and the sanctions, which caused a decline in exports.