By Publisher Lee Kyung-sik With Editor Joy Cho, Reporter Stephen Kim
“Economic cooperation has an important role in bilateral relations. The Islamic Republic of Iran and The Republic of Korea also are no exception.” So said Ambassador Saeed B. Shabestari of Iran in Seoul at an exclusive interview with The Korea Post at his Embassy in Seoul on Feb. 21, 2020 on the occasion of the National Day of Iran.
“The Republic of Korea,” he said, “is one of the advanced economiesin the Northeast Asia region, which has had special role in Iran's economic development, and the Islamic Republic of Iran has always embraced Korean companies and SMEs with open arms.”
On the other hand, he said, a significant necessity for rapid economic growth of the Republic of Korea has been achieved through Iran’s energy resources such as crude oil and natural gas and condensates. According to Ambassador Shabestari, there has also been a strong economic bond between the public and private sectors of two countries. He said, “I would like to reiterate that in recent years, large Korean companies have been able to gain a good and even competitive position in the 80-million Iranian market which could be extended to 800 million market if the central Asian and middle east countries are included.”
According to the Korean Ministry of Foreign Affairs,
Excerpts from the interview with Ambassador Shabestari follow:
Question: As we have not had the luck of interviewing Your Excellency so far, please introduce yourself in detail, including your career, family and hobbies.
A: First of all, I would like to express my pleasure for the opportunity to interview with The Korea Post. I wish it could have made earlier.
I welcome you to the Embassy of the Islamic Republic of Iran on the eve of the 41st anniversary of the victory of the Islamic Revolution in Iran and appreciate for arranging this interview.
I started my mission in South Korea as the Ambassador of Islamic Republic of Iran from October 2018. In 1988 as the Expert, Persian Gulf Affairs Division I, I started my career in ministry of foreign affairs of the Islamic Republic of Iran as the political expert. Then from 1997 focusing on Eastern and Northeastern Asian countries, I have been involved in all aspects of bilateral relations at various missions mainly in China (two terms 1997-2001 & 2007-2010) in this region. I have also been to Saudi Arabia for my first mission from 1991 to 1994. I am married and have three daughters who are studying in Iran.
Q: Please introduce your Head of Government in detail, including major achievements.
A: Before introducing the Honorable President of the Islamic Republic of Iran, it is necessary to a have a brief look at the Islamic Republic of Iran’s political structure. Political system of Iran is republican. The president is elected through election by direct vote for four-year term. The president is the head of the executive power. The national assembly (Majlis of Islamic consultative) and the judicial powers of Iran are two other governmental bodies responsible for running the country along with the executive power. These governmental institutions are supported by the supervision and guidance of Ayatollah Ali Kamenev, the Supreme Leader of Iran.
President Rouhani among the first generation of Iranian clerics involved in Islamic Revolution, as a lawyer and prominent diplomat who takes over head of executive power of the Islamic Republic of Iran since August 2013. He has also been a member of Iran’s Assembly of Experts since 1999, member of Expediency council since 1991 and a member of supreme national Security Council of Iran since 1989. President Rouhani was also deputy speaker of the fourth and fifth terms of the parliament of Iran (Majlis) and secretary of the supreme national security council of Iran from 1989 to 2005. In the latter capacity he was the countries to negotiator on nuclear disputes.
Negotiations which eventually led to a comprehensive nuclear agreement between Iran and the six countries; the United States, the United Kingdom, France, Germany, Russia and China (known as the P5+1) and EU.
At Rouhani's presidency epoch, we have witnessed Iran's pragmatic approach to foreign policy in international atmosphere. The culmination of this practical view to the Iran’s foreign relations must be sought in Iran’s tolerant and persevering policies in the face of developing pressures from US and some other European countries over Iran's peaceful nuclear activities.
From the beginning of Rouhani's presidency, government of Iran has adopted a constructive and peaceful approach to Its bilateral relations relying on mutual respect via assigning of H.E Dr Zarif as Honorable Minister of Foreign Affairs of Iran. In this perspective, the Republic of Korea has a special position in the foreign policy of Mr. Rouhani's administrative among Northeastern Asian countries.
Q: Nowadays, economic cooperation is very important between the countries. Who are the major Korean companies actively engaged in bilateral economic cooperation? Please introduce them in detail in the order of size and scale of business activities.
A: As mentioned, economic cooperation has an important role in bilateral relations. The Islamic Republic of Iran and The Republic of Korea also are not exceptional.
The Republic of Korea is one of the advanced economies in the Northeast Asia region which has had special role in Iran's economic development. The Islamic Republic of Iran has always embraced Korean companies and SMEs with open arms.
On the other hand, a significant necessity for rapid economic growth of the Republic of Korea has been achieved through Iran’s energy resources such as crude oil and natural gas and condensates. There has also been a strong economic bond between the public and private sectors of two countries. I would like to reiterate that in recent years, large Korean companies have been able to gain a good and even competitive position in the 80 millions Iranian markets which could be extended to 800 million market if the central Asian and middle east countries included.
Regarding your Question about the successful Korean companies in my country, indeed in current situation, I would rather not name them. Hope you would find out why by the end of the interview through further explanations.
Q: What is the present volume of bilateral trade, its outlook in the next 12 months?
A: According the last published official statistics on trade between the Islamic Republic of Iran and the Republic of Korea, volume of transactions reached $23 million on December 2019. The total trade volume between Iran and South Korea in 2019 amounted to less than $2.5 billion, which is insignificant compared to the trade capacity of the two countries.
Trade turnover between the two countries in 2017 and 2018 stood on $12.3 billion and $6.3 billion, respectively. It might be interesting that at a historical stage of bilateral trade relations in 2012, both countries experienced a prominent volume of trade of $14.7 billion. South Korea became Iran's second largest trading partner after China at that time.
An important portion of this significant decline in Iran-South Korea trade relations is due to unfair and illegal unilateral U.S. sanctions against Iran followed by unlawful withdrawal of Trump administration from JCPOA.
As the Ambassador of the Islamic Republic of Iran engaging close ties with most main trade partners of both countries, would like mention that neither of them expected such a decline in bilateral trade in this new period of illegal sanctions. Unfortunately Korean companies mostly have lost for the past year and some of them have even gone bankrupt.
Q: What are the areas in your country where you want Korean companies to invest and what are the areas where you wish your businessmen to invest in Korea?
A: Iran is a vast country with an area of 1,648,000 square kilometers, rich in natural and human resources with population of about 82 million.
Thirteen percent of the world's oil reserves and 18.2% of the world's proven natural gas reserves is located on Iranian territory. In other words, Iran is the second largest holder of hydrocarbons in the world.
Iran has a unique geostrategic and geopolitical position in the West Asia region. An important part of the Persian Gulf, a vital energy corridor of the world, lays within the sovereignty of the Islamic Republic of Iran. Iran is on the route connecting East -West, North - South Asia and plays an important role as Asia's transit corridor to Europe. For Korean companies, there are countless economic opportunities.
There are numerous investment opportunities laying in my country for Korean conglomerates. As a bridge located in four-way link between Asia, the Middle East and Europe, with vast and varied mineral resources alongside cheap energy opportunities enjoying young and active population of 25 million, more than half of whom are college-educated, Islamic Republic of Iran has given golden opportunities to international capital owners to invest in deferent fields.
Investing and joint venture in diverse sectors of the basic, upstream and downstream industries in the oil, gas and petrochemical sectors; participation in large infrastructure and development projects, such as road, rail, shipping, automotive, power, agriculture, fisheries, medicine and medical equipment; constructing and equipping hospitals and hitch industries are just some of the areas in which Korean companies can invest.
In terms of tourism, according to the World Tourism Organization (UNWTO), Iran is in the top five in the world in terms of natural attractions and in the top 10 in terms of historical attractions in the world. Iran has a 7,000-year civilization history. Territorial diversity and the presence of the four seasons made it possible for foreign tourists to choose Iran as their destination.
By the last illegal imposed sanctions the number of tourists who visited my country reached 5 million. According to the government's plan by 2025, the number of foreign tourists in Iran should reach 20 million. In this regard, I would like to declare that the Tourism Organization of our country is ready to cooperate with Korean companies in investing in this sector.
Another very favorable area for cooperation is the participation and investment of small and medium-sized enterprises (SMEs) in the field of knowledge-based technologies and start-ups. The Islamic Republic of Iran has made remarkable progress in recent years in the area of knowledge production and the development of the knowledge economy. The pace of Iran's progress in this area can be traced statistically to the growth of the number of Iranian-based knowledge companies from 52 in 2014 to more than 3,500 in 2018. These companies accounted for 15% of Iran's export revenue this year.
Q: What are your competitive products and/over services attractive to Korea and what are the Korean products and services that your country might wish to import?
A: If we put the energy field aside, Korean companies have superiority over Iranian companies because of advanced hi-tech technological advantages. If the conditions change and trade relations between the two countries improve, the Islamic Republic of Iran can be a very good market for Korean-made goods. Korean goods in Iran are very well-known.
Of course, the situation in Iran is changing rapidly. Today’s world is a world of competition. We cannot tell the Iranian people to wait for Korean goods. Conditions in the Iranian market are changing rapidly for Korea’s competitors. I have repeatedly warned the Korean counterparts of this situation. Our people say “we have money in Korean Banks and would like to benefit from it in bilateral trade”.
In connection with the Korean market for Iranian products, a wide range of agricultural products, such as pomegranates, strawberries, legumes and nuts, can be listed as Korea’s exportable items. In the field of industrial products, Iran has made significant progress in the field of nanotechnology products in recent years. You may be surprised to find out that the reliable and efficient masks available in the Chinese and South Korean markets to protect from new coronary artery disease in the East Asian region are made by using Iranian native nanotechnology.
Q: Do you have a Korean Honorary Consul and/or Honorary Consul General? If yes, please introduce him/her and activities.
A: The Embassy of the Islamic Republic of Iran does not have an honorary consul or consul in South Korea. Economic and business relations are handled by the Embassy’s economic experts. Currently, the Chamber of Commerce and Industry of Iran and South Korea are pursuing bilateral trade affairs within the framework of the Chamber of Commerce, Industries and Mines of Iran.
Q: Please add whatever other details that your Excellency might consider to be important.
A: Relations between the people of Iran and Korea have an ancient history. This background can be traced back to the position of the Sheila Empire in Persian Kush.
At the present time, the naming of two beautiful and important streets of Tehran and Seoul in the capitals of the two countries expresses the interest and connection of the hearts of the people of Iran and Korea to each other.
Fifty-eight years have passed since the beginning of diplomatic relations between Iran and Korea in 1962 and The Islamic Republic of Iran has always strived to play a constructive role in the context of mutual respect and peaceful coexistence with South Korea’s friendly country, taking into account its position.
The Islamic Republic of Iran has always been one of the most stable and reliable sources of energy. In other words, the engine of South Korea’s economy and witnessed the continued supply of oil to the country during the oil crisis of the 1970s.
As the United States withdrew from its nuclear deal with the five Security Council members and Germany (P5+1), the Joint Comprehensive Plan of Action (JCPOA), in May 2018 and imposed a new round of unilateral and illegal economic sanctions against Iran, the adoption of this policy by Koreans has significantly reduced trade cooperation with the Islamic Republic of Iran.
Anyway, as the ambassador of the Islamic Republic of Iran, it is my duty to convey to our Korean friends the message of friendship between the Iranian government and the nation.
The Iranian market is still ready to accept the capital of Korean companies and their products. Time is limited and our Korean friends are losing their further opportunities in Iran. I’m sure if the Korean companies would reconsider their approaches to working with Iran at current period, the Iranian counterparts would welcome them.