www.parsoilco.com

PARS OIL COMPANY:

Is the biggest supplier of IRISL & NITCIs a manufacturer of wire rope greasesPars Lubmarine has successfully passed laboratory steps of WARTSILA S standards

PARS OGHYANOUS is a premium quality cylinder lubricant designed for use in all lowspeed crosshead diesel engines which burn residual fuel with sulphur content up to 4.0% weight.

PARS OGHYANOUS 50100 oil is a premium quality cylinder lubricant designed for use in all types of low speed crosshead diesel engines which burn residual fuel with sulphur content up to4.0% weight. It is particularly suitable for the new generation of diesel engines requiring TBN=100.

PARS MODJ is a multifunctional lubricant for medium-speed trunk pistons diesel enginesoperating on residual fuel with sulphur content up to 2.5% weight.

PARS MODJ X is a multifunctional lubricant for medium-speed trunk pistons diesel enginesoperating on residual fuel with sulphur content up to 3.5% weight.

PARS MODJ XL 4055 is a multifunctional crankcase lubricant for highly rated medium speeddiesel engines operating on residual fluid. This oil is designed for conditions of very high oil stress and has been further optimized to improve deposit control.

PARS DARYA is premium quality diesel engine lubricant, specially designed for the most severe service main propulsion and auxiliary marine trunk piston engines burning distillate fuels having sulphur content up to 1%.

PARS LENJ is multi-purpose system oil designed for low-speed, crosshead, marine diesel engines.

,

Head Office: (+9821) 22229500

Are you looking for a leading shipping agency that renders various types of shipping services in all Iranian southern ports?

You are in the right path:

Hoopad Darya Shipping Agency Company(IRISL Group Agent)

(ISO 9001, ISO 14001, OHSAS 18001)

• Providing full agency, husbandry and protective agency services in all Iranian southern ports. HOOPAD DARYA SHIPPING AGENCY Company, take’s care of your interests, wherever in the Iranian southern ports

• Providing commercial operation services In Tehran, Mashhad & Iranian Southern ports.• Providing Container operation services in Tehran and all Iranian southern ports.• Replenishment of Bunkers & Fresh Water to the ships in all Iranian southern ports.• Providing all types of crewing services including sign on/off, repatriation, medical

services/ assistance.

ADDRESSHoopad Darya Shipping Agency Company, No: 101, beside Shabnam Alley, Ghaem Magham Street , Tehran , Iran.

Tel: (+98) 21 84208 Fax: (+98) 21 88845067

Email:md.office@hdsac.netmarket.mgr@hdsac.netex.office@hdsac.netcs.office@hdsac.netpublicrelation@hdsac.net

web site: www.hdsac.net

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Marine Engines & Systems Power Plants Turbomachinery After Sales

Whether upgrading your equipment to meet new standards or xing an urgent problem – when you need us, we are there, no matter what! This is what we commit to 100% and this is the way we run our world class service organization for you. Your machinery’s availability, ef ciency and longevity are the sole focus of what we do and think about every day. Wherever you are in the world, we are at your disposal 24/7 through our global network of service facilities. Find out more at: primeserv.man.eu

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Legal Representative:Ali Akbar Ghonji

Editor-in-chief:Amir Fallahm.fallah@irisl.net

Journalists:Behrooz Ghahremani, Seyed Majid MotahariLeyla Beyranvand , Fatemeh Moonesan,Sarah Zeinalzadeh, Fatemeh Bayat,Fereshteh Azizkhani, Vahid Basereh ,Narges Ehsandar, Sepide Yousefi, Mehri Azizi,Sahar Eyvaziadli

Designer: Fatemeh Abedini

Financial-Administrative Department: Golnoosh Afrooshe

Photographer: Ali sobhan hosseini

General Manager ofAdvertising Department:Alireza M.Sadeghi

To advertise in Payam-e-Darya, please contact Alireza M.Sadeghi at Tel: +989121001769Email: al_m_sadeghi@yahoo.com m_sadeghi@irisl.net

Published quarterly by IRISLVolume 5, Summer 2017ISSN: 1027-1058

ADDRESS:No.523, Asseman Tower, Shahid Lavasani (Farmanieh) Junction, Pasdaran Ave. Tehran - Iran.P.o.Box: 19395/1311Tel: (+98 21) 26100368Fax: (+98 21) 26100371

Shipping MagazineCONTENTS

010 Opening Remar ks: Two Answers for One Problem!

015 IRISL: IRISL to Develop its Fleet

016 IRISL Seeks to Develop its Fleet

018 Active Participation of IRISL in the International Arena with Fleet Renewal

020 Unprecedented Performance of IRISL’s Container DivisionDuring 19 years

024 Expanding the Scope of Activities from European Ports to South America

028 Start of a New Era for IRISL

030 Iran’s Membership in International Insurance Clubs

034 Purchase of New Container Wagons and Boosting of RailTransportation

036 MITD to Provide Marine Industry with Software

039 Marine: Emission, Recycling and BWM

040 The Ballast Water Management Convection and itsImpacts on the Shipping Industry

060 Implementation of Three Major Acts by IMO Comes toForce

066 Targeting and Market Segmentation in Shipping Industry

070 Safety Regulatory Framework of Offshore Structures

078 A New Setting for Lines’ Venture to and from Iran

080 Iran; Connecting Bridge between Asia and Europe

084 Qatar’s Big ‘’If ‘’ for Convincing ship- owners in theWorld

090 Milestone for Expanding Iran-Germany Collaboration

093 Iran: Rouhani’s Accompolishments

094 Positive Change

098 JCPOA re-launched Economy Train of Iran

104 IRISL Receives 10-Figure Insurance Coverage

108 We Will Promote Iran’s Position in the Global Steel Market

112 Iran – Brazil Tie Intensifies

120 Iran’s Industrial Sector; An Opportunity to Gain Profit

124 Iranian Handicrafts Exports Tripled

128 Carmakers Cross the Sanctions’ Red Light

133 Energy: In Counterpoint to Sanctions

134 Fruits of Energy Diplomacy and Smile in Gas Capital of Iran

140 Security of Foreign Investment Is Provided in Iran

144 Total Waiting for Entrance to Iran’s PetrochemicalGateways

148 The $3 billion Financing of Siraf Project by the ForeignConsortium

154 850 Tankers Have Docked at Kharg since JCPOA’s Execution

158 OPEC members united against Trump’s oil policy

162 The European Companies Entertained in Tehran OilExhibition

166 Investment Attractions in Iran’s Oil Industry

169 Bulletin: The silk Road Revival of Silk Road PassesThrough the Sea

170 News

Two Answers for One Problem!

China is the wizard of the world economy in the new century. A wizard that find’s a solution after many years dealing with the communist ideology of Mao and dense population; however, it now changes the processes based on the structures. This change not only has affected this vast country with a population of over a billion but also transformed the whole idea of the world economy.At the beginning of the new century, by resorting to production approach for the market and open-door policy, China could both attract foreign investment for development and also affect the industries in the world based on its tremendous, and of course cheap labor. China that has changed the processes during the new century, was in need to build its own country. They need materials to do this, so it constituted a large part of China’s imports in addition to the raw materials required for the production field of the country.From the time of the discovery of fire and the ability to use metal as an essential element for development, steel has always been considered as an effective element of progress and expansion, so much so that, currently one of the characteristics to determine the progressiveness of any ego is the per capita consumption of steel of that country.Accordingly, China that has changed the world with its rising, began to staggeringly purchase iron ore and turn to the mass production of steel for its rapid development. It could achieve steel production more than the production of all the countries in the world within a few years to the extent that in 2008 and at the beginning of the economic crisis in the world, China, alone produced 600 million tons of steel per year.

Since China’s development is based on trade, it requires supplying the materials on the one hand and selling the products to the world on the other hand. Accordingly, the element that was flourishing along with China’s growth, was traded dependent services, i.e. shipping.In the days of stunning growth of China, the shipping industry witnessed the days of abundance. 2002-2012 were the best days of the shipping industry in terms of growth and development. The most important reason for this factor was summarized in one word: China. The more was China’s thirst for production, the more need it had buy raw materials and export finished products. This led to the need for carrier vehicles. Meanwhile, China’s development trend continued in the direction that Chinese goods were available in each and every corner of the world like oxygen.Based on the upward trend and the need of China, the shipping companies began to order more and larger sizes of ships in order to gain profit along with the need of China.But two things destroyed the joy of sailors who were seeking to dominate the market and consequently make additional earnings. The first one was the economic downturn in 2008 and the second one was a push to change China’s approach!As the economic recession started, the states and countries of the Western Bloc were faced with the financial and liquidity crisis, so much that some parts of the West were on the verge of bankruptcy and were forced to sell bonds to escape from this situation to be virtually standing countries; however, they were called heavily indebted in the back-end.Due to this, an important part of the Chinese market

By: Amir Fallah Editor in Chief

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O p e n i n g R e m a r k s

Two Answers for One Problem!

was in trouble. Although Western governments determined cheap that Chinese goods one of the main causes of the crisis which resulted in the failure of other industries in such a competition, the same governments while loding their complaints resorted to rescue China to be saved from collapse through large-scale loans and bond purchases by this country.The other factor were changes in Chinese policy. With the change of the president, exactly in 2008, this country decided to change the growth trend in order to avoid saturation and prevent a social crisis and for the first time in a communist country, they talked about consumerism.The people of the world and especially shipping companies which had always been accustomed to the growth of more than nine percent in China, suddenly were faced with a reduction of about 4 to 5 percent of growth in the country. Considering the volume of China’s economy, such a domino-like reduction of losses was passed on to dependent businesses.Additionally, the increased attention to efficiency in this important region which has become the world’s economic giant, caused some industries, including the steel industry to be faced with a decline in production and the closure of some of them betwean 2012 to 2014.The downturn in maritime transportation coincided exactly with this approach. This downturn was the result of reduced load carrying capacities due to the slow growth in China on the one hand and the surplus supply that was added to the fleet during the resource abundance on the other hand.This recession resulted in a sharp decline in freight rates, so the result was the reduction of profits and increased losses of the shipping companies to the

extent that despite all preventive measures, Hanjin Shipping rolled into bankruptcy. 2015 was another year and the basic industries of China also took another measure. Concurrent with the relative calm of the Western Bloc after the 2008 financial crisis and a dramatic reduction in oil prices, large manufacturers began to increase their production. In this regard, everybody knows that as we talk about more production, eyes would focus on the Yellow Dragon. China partially came out of the lethargy and began mass production backed by the governmental support. It went so far that at the end of 2015, the country’s steel production reached more than one billion tons- that was the most unprecedented in world production. But the process and behavior of the dependent services were not like the previous period, neither was there any growth in transport nor the shipping companies.The slap of the downturn during the market drop was so heavy for the shipping companies that they refused to re-change the strategies during the rise of the market.If China was seeking efficiency by the economic slowdown, shipping companies were also headed the same direction during this period, so they merged companies and created joint ventures to move toward higher efficiency, with only one exception. The difference was that China moved toward efficiency in production what was called optimized production, but given the available load, the shipping companies moved toward efficient “distribution”, not the efficient behavior in order to develop. This difference in the attitudes caused even the largest shipping companies in the world to sustain major losses. 1111

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IRISL

IRISL CEO:

IRISL to Develop its Fleet

IRISL Seeks to Develop its FleetTOGY talks to Mohammad Saeedi, managing director and chairman of the board of Islamic Republic of Iran Shipping Lines (IRISL), about the company’s expansion plans in the post-sanctions era. He gives an overview of Iran’s key ports and bunkering infrastructure and plans for growth in this area.

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Has the lifting of sanctions changed IRISL’s plans?During sanctions, we couldn’t develop our-selves and offer complete services. We could not renovate our vessels without certain software and hardware. However, following the removal of the sanctions, we have a huge plan to increase and to develop our vessels.Iranian companies need to export their products to Europe, and around the world to African and Asian countries. So we have to increase our vessels to provide sufficient services for that.We have very good shipyards in Iran, but based on our requirements for modernizing our vessels, we have to order from foreign suppliers, at least for the next six to seven years.We will focus on Southeast Asia [for vessel purchases]. The quality is good and the price is much more competitive than that of other producers.

In which sectors do you see growth in terms of the volume of exports?We see this mostly in petrochemical products. We have a lot of capacity and many kinds of petrochemical products in Iran - urea, ammonia and many kinds of polymers. We know that many European factories and companies need Iranian petrochemicals.What is the approximate value of Iranian petrochemicals exports made by IRISIL and where do they go?Based on recent estimations, around USD 40 billion per year is exported to Asia and Europe. This will definitely be increased to approximately USD 60 billion over the next one or two years.Our expansion projects are under construction and they will be operating in the next two years. One of our major priorities is purchasing LPG carriers, as well as carriers for chemical products. We already have vessels capable of transporting LPG.

Besides being able to export directly to Europe, are there any other changes that you have felt since Implementation Day in January?We have started new lines from the Persian Gulf to ports in the north and south of Europe. By establishing such new lines, we will cover all of the European ports. In the north, Rotterdam and Hamburg would be the main ports, and we have

recently exported some petrochemical products there. Genoa in Italy, Barcelona in Spain and Malta will be covered by our vessels.New lines are being established from the Persian Gulf to Brazil and Argentina. The new route would be an international line for our company directly from an Asian port to the south of Africa from there to Latin America.Another plan under consideration to be completed in the next four to five months would be establishing a new line from the Persian Gulf to Vancouver, Canada. The new approach by the Canadian government provides a positive atmosphere for trade and for starting business between Iranian and Canadian companies.

Which are Iran’s most important logistics points for exports and imports?Right now the major Iranian ports are the Shahid Rajaie port complex at Bandar Abbas, where a third terminal will be announced as an international tender by the Iranian Ports and Maritime Organization.Beyond Shahid Rajaie, Imam Khomeini would be the other major Iranian port to handle any importing and exporting of bulk commodities.In the future, we will have a good capacity at Chabahar, especially to connect Indian and Pakistani companies to Afghanistan and the Suez countries. That would be one of the major ports for the future and of course some of the specific countries such as India, Pakistan and China are interested in joining the project.

How do you assess Iran’s infrastructure for bunkering and refueling?Bunkering would be one of the main targets for a business to develop inside of Iran and as an offshore project - even overseas. Having a good capacity for bunkering is strategic because we have a lot of refineries in Iran. IRISL is one of the major players in the bunkering business right now and we are anticipating developing this business both inside and outside of the country.We have huge bunkering capacity and good facilities in Bandar Abbas and Qeshm Island, where the storage capacity is around 100,000 tonnes. We are interested in developing this business in Asian countries, especially in Singapore as a hub. We are looking to find the best partner in Europe.

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After leaving behind eight years of tough sanctions, creating an appropriate business atmosphere and the revival of all the agency networks, and business lines, Islamic Republic of Iran Shipping Line Co. (IRISL) plans to have active participation in the international market at post-JCPOA era with fleet renewal and the acquisition of new generation vessels. Technical & Commercial Director of IRISL Capt. Amir Saman Torabizadeh in an interview with Payam Darya talked about the programs of the company for fleet renewal, trade routes and the status of the company in the post-JCPOA.

Technical & Commercial Director of IRISL:

Active Participation of IRISL in the International Arena with Fleet Renewal

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I n t e r v i e w

immediately stopped. At the same time, it could change and improve the profile of vessels according to the company’s needs and comply with the pattern of sea transport industry, update their specification and also reduce the price based on the daily rate. Meanwhile, the Korean party withdrew all the arising claims in respect of damages and losses incurred and the previous in advance payments were regarded as the prepayments of the updated contracts.

At the moment, what share of the international market belongs to the commercial fleet? During the sanctions, a large number of ships of the fleet were laid up. However, now all the ships of the fleet are active around the world. With the removal of the sanctions, the ability to operate the commercial fleet of the country is provided in all the trade routes of the world and also in the shipping lines of the East Asian region, North China, Europe, Africa, Oceania, North and South America and the Persian Gulf for exports and imports. This gives a great opportunity to Iranian merchants and the international marine transportation companies including IRISL and this is considered as a major transformation in our country’s economy.In the near future, Iran will be one of the main exporters of bitumen, mineral cargoes, petrochemical products, and gas condensates. With the implementation of JCPOA, there is no need for intermediaries and Iran could directly and with no restrictions export these products to European and East Asian Countries. One of the development plans of this company is to enter the Marine transportation market of these cargos.

What was the most important

According to the removal of the sanctions, what actions do Islamic Republic of Iran Shipping Line Co., take in order to renew the fleet and increase the capacity? During the sanctions era, the process of orders and deliveries of new vessels was stopped due to increased restrictions and the imposed pressure against leading countries in the shipbuilding industry and correspondent of Iran. This, of course, has some consequences in maintaining the most important assets of the company i.e. its fleet of commercial vessels.These days, IRISL is at the time that requires the complete renewal of its basic assets which is its fleet. In this regard and with the purpose of competitiveness and uninterrupted effective presence in the global shipping markets, IRISL needs a new generation of Eco-ships in terms of economy of scale with low fuel consumption that complies with the requirements of environmental. Moreover, at the current time by the provision of reasonable commercial conditions at post-JCPOA, the production cycle of the country’s key industries is increasingly operationalized and ready to import the products. Therefore now that the possibility of ordering to internationally recognized shipyards has been provided, and the type and number of required vessels have been determined, negotiations with credit institutions and shipyards, including banks and Chinese and Korean shipyards has been started. The orders for building vessels based on the development plans considered by IRISL will be delivered to these shipyards. In this context, and so far, after a year of continuous negotiations, IRISL succeeded to revive the shipbuilding contract which was signed in 2007 and 2008, and was

inaugurates of IRISL after the implementation of JCPOA?After the implementation of JCPOA, the most important developments of IRISL are the revival of agency networks and business lines throughout the world. After the implementation of JCPOA and in order to revive and expand the network of agencies, the following measures have been on the agenda: the establishment of joint companies of northern and southern Europe with the coverage of the countries such as Germany, Italy, Belgium and the Netherlands, the establishment of joint venture in Turkey and India, choosing the represented companies of the countries including Spain, France, Portugal, Slovenia, the Mediterranean basin and the Balkans, the revival of representing of South Africa, development of the agency network in the Persian Gulf and Oman Sea and the similar measures in South Asia and South America.In addition, commercial lines to all over the world including Europe, Mediterranean, South American, Japan, South Korea, the Middle East, South Asia, and Australia were revived.

Do the financial and banking problems exist in IRISL fleet?With the lifting of the sanctions against the Islamic Republic of Iran Shipping Line, the access to the global financial network and the ability to finance the major development projects of the company is provided which was stalled for years. In this regard, many international financial institutions have announced their readiness to cooperate with the company. Also, it is hoped that the money transfer fee at the international level and problems regarding the L/C opening will soon be resolved.

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General Director of Container Shipping Co.:

Unprecedented Performance of IRISL’s Container Division During 19 years

The container division of IRISL has reached to a stunning number for cargo shipment in the recent months that the like of which could be found in fewer periods. This success has occurred for the national fleet while currently, 17 shipping lines transit to Shahid-Rajaee port, directly, regularly and weekly. At the same time, a large number of shipping lines and NVOCCs transship via Dubai. “Achieving such a record is unprecedented during 19 years of operation” General Director of Container Shipping Co., Cap. Hamzeh Keshavarz, said in an interview with Payam Darya. Referring briefly to the integration of large container companies and the formation of new alliances, he outlined this company’s future plans in this interview. Below is the whole interview.

By: Narges Ehsandar

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How do you evaluate the situation of the container division of IRISL in recent months?Cargo shipment has grown considerably both from Asia and Europe, such that in the first two months of the year (Iranian calendar- April & May), approximately 195 thousand of TEU is transported, merely from Shahid-Rajaee port that is 52.5% of the port’s total performance. This market share is even more than the sanctions era in which foreign lines did not come to

Iran. However, currently 17 large foreign container lines traffic directly and weekly and the other lines also transship via Dubai. As for the grace of God, the wisdom of senior management of the group and the hard work of our colleagues, we are now in a place that our market share is more than the time that no foreign lines came to the country.Hafez Darya Co. along with Valfajr Shipping Co. carried more than 78% of the Iran’s cargo during the sanctions, 28% percent of which is carried by Valfajr Shipping Co.

from Dubai and the containers of other lines. Now, this number is only the share of the Container Shipping Co. compared with other lines. In addition, in terms of the performance compared to the first two months of the previous year, we have experienced 61 percent of growth and the freight rate has been also significantly increased.

As you have mentioned, will the boom return to the world’s container division?All the main world corridors of Asia to Europe, Asia to the Persian

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Gulf, India to Europe, Europe to India, and Europe to the Persian Gulf witnessed the growth in freight rate after the formation of the strategic alliances. Some of the shipping lines could also get out of red status, namely Back to Black in their own words. Although some of them are still in the red status, their loss is far less.

How is the cooperation of Container Shipping Co. with other international lines?A series of measures are taken to cooperate with the International Lines. The service of India to Iraq had a good growth in terms of international transportation. Some of the international lines are interested in participating in this service and we are currently investigating the issue. Fortunately, we have experienced a very good trend in the growth of international cargo transport in the container division. Despite the loss occurred for the world container lines at 2016, we could pass the year with profitability and have an acceptable performance for our shareholders and the macro management of the company. We hope to have good news in the field of international cooperation with other lines.

To what extent the implementation of JCPOA was involved in the increased performance of Container Shipping Co.?In fact, JCPOA facilitates the traffic of vessels, the company’s relationships with foreign lines, terminals, and ports. Some of the major and bulk cargo owners that could not work with IRISL Group due to the sanctions have returned to us and we could compete with foreign lines in a fair and more

appropriate condition. During this time, our market share at Shahid-Rajaee port was unprecedented during the operation of container division at IRISL. It means that the share we have experienced during the two first months of the year (Iranian Calendar) was unbeatable during 19 years of operation of Container Shipping Co. in a way that even the foreign lines could not get this share during the sanctions.However, along with Shahid-Rajaee port which is the main container port of the country, the other ports also have the same conditions or even are in a better one; for example, our market share at Chabahar port is approximately 90 percent.Another event that happened in the recent period is establishing a direct line from Candela

and Mundra ports of India to Chabahar port. Currently, about 3000 containers are reserved that should be transported in this route and a significant number have been discharged.

How do you evaluate the recent developments in the container market?There is a while that we are witnessing the integration of some companies and then the formation of the strategic alliances to the remaining companies in the global markets of the container. Therefore, nine big container lines either bankrupted, merged or were purchased by other lines. From the first of April 2017, the remaining lines have formed three major strategic alliances. M2 Alliance contains two big lines of Maersk Line and MSC Line. The 2222

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other one is Ocean Alliance that includes CMA CGM, COSCO (Which is merged with China Shipping Lines), EVERGREEN and OCCL shipping lines. The other union called THE Alliance which consists of three Japanese lines names, NYK, K Line and Mitsui O.S.K. Lines (that is merged together). In addition, Hapag-Lloyd Shipping Company is merged with a United Arab Shipping Company and ultimately this is Yang Ming that leads to the formation of this alliance. The activities of these alliances began in the first of April and at the same time; we witnessed a significant increase in worldwide container freight rates across the world. Currently, the freight rates of all the routes increased between 60 to 100 percent.

What are the plans of Container Shipping Co. for the future? We intend to maintain the profitability of the company. We have planned for about 14 thousand and 500 containers for large vessels that will be delivered up to 10 months. The purchase of new containers is also on the agenda and we have to make a market with proper slope and need to have load increase. We will connect the European service of Container shipping Co. to India. In other words, the new line will be Europe-India line that is part of the company’s strategy to strengthen the international market and is not related to Iran’s cargo. Concerning the international cargo, we hope to gradually reach to the pre-sanctions era that provided approximately 50% of shipments and revenues. Now, in Bandar Abbas port, the containers are transited to India and Europe as transshipping to prepare a triangle service that transit from Europe to Iran, from Iran to India and again from India to Europe in order to absorb directly the imported and exported cargos of India and Europe.The next plan of the company is providing the required containers. In this regard, the approval of the board of the holding company is taken. One of the existing problems in the global level is the cube container shortage. According to the new capacities that will be added to the fleet, we have planned the container supply schemes based on the amount needed for large vessels that will be built in South Korea and also for Iran-Kashan ship. Then, our colleagues at Technical Department of Commerce Division could procure them with a good price and suitable terms.

What was the reason for the formation of alliances?The reason for the formation of alliances has different factors. The main factor is that they could cover more routes by sharing each other’s vessels at a lower cost so that they somewhat could control the rates. Optimal capacity management is applied in order to prevent parallel services. it means that instead of using two services on one route, they could use one service. So, two empty vessels would not traffic and instead, another vessel would be used in another route. They would be able to more complete their network coverage and reinforce Point to Point traffic instead of transshipping. A line that covers a division could be at the disposal of everyone, instead of participating in the network of other lines. Obviously, the fuel consumption would be lower, less carbon dioxide would be released and it would be in favor of the earth in terms of environmental perspective. However, it has also some disadvantages in a way that it would create some obligations and in most cases would be backfired, so that we must be very careful in the selection and entry to them.

Does the formation of such alliances lead the activity to oligopoly?Yes, it does. The container world will move toward oligopoly. However, a few years ago, UNCTAD had given this warning that the number of container lines that traffic to each and every port of the world, will be diminished year by year and the ports will be under the coverage of a smaller number of lines, this means moving toward oligopoly .

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Would you please explain the history behind the activity of Ship Management Co.?Since the establishment of the Islamic Republic of Iran Shipping Line (IRISL) in 1968, Technical Assistant Department of IRISL has been one of the main divisions in IRISL organization. At that point, technical management of fleet ships was carried out by foreigners. Gradually, foreign forces were replaced by Iranian sailors and all the activities of the technical division of IRISL fleet were taken by Iranian forces, so that it can be said

Rahbaran Omid Darya (ROD) Ship Management Co. that is founded during the cowardly sanctions period still continues its activities in Post-JCPOA era. Expanding the scope of activities from European ports to South America, cooperating with foreign rating agencies, managing tanker ships and managing 90 of fleet ships are among the activities of this company. Seyyed Reza Seyyed Alizadeh, CEO of ROD Ship Management Co., explained the details of the activities of this company in an interview with Payam Darya.

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CEO of ROD Ship Management Co.:

Expanding the Scope of Activities from European Ports to South America

What is the main area of activities of ROD Ship Management Co.?Supplying chain management, managing the planned maintenance and preventive maintenance of ships, providing professional advice and guidance to ships, giving specialized consultations to both the owner and exploiting company, implementation of international laws and regulations for the ships under management, providing specialized consultations in order to buy and sell vessels, performing different stages of flag transfer, changing the class and name of the ships upon the request of the owner,

updating software, hardware, telecommunication and satellite equipments of vessels, providing specialized services to the owner regarding the shipbuilding, managing the voyage maintenance of the ships, managing periodic repairs, and damages managing the inspection and keeping up to date the certificates of the ships, managing to protect the ships against piracy, optimal cost management of ships, managing the equipment and machinery updates of the ships, eliminating the technical off-hire, estimating the annual budget of the ships and informing the owner are

that the main body of the technical assistant consists to offshore forces. During the sanctions, ship management department of the technical assistant to IRISL was first renamed to “Soroush Sarzamin Asatir Ship Management Co.” and then to “Rahbaran Omid Darya Ship Management Co.”, so that the technical management of the ships could be still continued steadily in the unpleasant circumstances of the sanctions. Fortunately, with the grace and favor of God, ROD Ship Management Co. could accomplish its activities properly in 2016 which was a very critical year for IRSIL.

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among the main activities of Ship Management Co.

What effects did the JCPOA have on the activities of the company?With the formation of the JCPOA in January 2014, many foreign companies including logistics companies and rating agencies had interrupted their communications with IRISL due to the sanctions and we were not able to use their services, but after THE JCPOA they return to Iran.Different groups of shipbuilding and maintenance sections from different countries such as Poland, China, South Korea, Japan, Qatar, Bahrain, UAE,… has communicated wish ROD Ship Management Co. and fortunately, good achievements were also gained. Employing the internatinal classification societies was one of the extremely valuable achievements. Before the sanctions, some classification societies such as LLOYDS, DNV GL, and BV cooperated with technical department of IRISL but their cooperation was discontinued due to the sanctions. However, in addition to these societies, others including RINA, NK, KR, CCS, PRS, and IR are also added in the Post-JCPOA period, the cooperation with six of these classification societies started after several negotiations.It is noteworthy that taking advantage of the international classification societies was always one of the goals of the CEO of IRISL, as the arrival of fleet ships to many foreign ports was impossible without incorporation of the mentioned societies. Fortunately, the negotiations with these societies was succeeful and the important achievement in the Post-JCPOA was simultaneous use of both domestic and societies, so that with continued cooperation with domestic societies, the field of growth for local soceity was

developed and we hope to see the creation of a domestic international societies on the global stage in the near future.I should do mention that changing the class of the vessels was a codtly process for any ship management company, particularly when we had to ...... from Non-IACS to IACS societies. One of the requirements of the international classification societies to change the class is to dock the ship; however, it did not take place perform with the insistence of ROD Co. For the eagerness to cooperate with IRISL and entering the market, they accept not to perform it and substitute it with case inspections. During the inspections, they achieved the desired results as the ships were managed effectively and desirably during the sanctions. Because of non-acceptance of dock operation on vessels, fortunately, Ship Management Co. could prevent to exit about ten million dollars from the country and the class of 66 fleet ships were changed from domestic societies to Joint venture ones, by the end of the Iranian year (March 2017).

How will be the relationship with the representatives?ROD Ship Management Co. has technical representative offices in Singapore, China, and the UAE. These offices take the necessary steps regarding the planning for voyage repairs and providing required parts and supplies for the vessels and they report their performance at the end of each month. Due to the conditions created by Post-JCPOA, German representation office will soon reestablish its activities and the technical representative of this company will be soon added to that office so that in European trips, the ships could solve their issues via this office.

hould still be continued. Currently, IRISL has the first rank in the Middle East and this brand should be maintained

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How many journeys do the fleet ships have to European and South American ports by the implementation of the JCPOA?During the sanctions, the business trips of fleet ships were stopped to many foreign ports, however, by the implementation of the JCPOA in 2016, these trips were started again, in a way that the fleet ships of IRISL had 31 voyages to European ports, 26 trips to South American ports, two to Japanese ports and one traffic to Australia in 2016-2017. Thanks to the efforts of staff on board and back up of office technival assistance, these ships have not been detained when they were inspected by port authorities of these countries. 2016 -2017 (1395 in Iranian calendar) was a very critical year for ROD Ship Management Co., since on the one hand, upon the order of the CEO of IRISL, technical costs must have been managed and reduced and on the other hand, ships’ traffic to European and South American ports and other areas should had been started effectivectly. Since there was a probability of observing the deficiency and detention by the port authorities, it doubled the responsibility of this company for the preservation of assets of IRISL. That’s why all my colleagues at Ship Management Co. and the respectful sailor staff have taken this important step with more interactions and fortunately, we were succeeded. By providing the necessary supplies and spare parts for the fleet ships, not only the technical costs were reduced by five percent, but also we had suscained 81 percent increase in traffic of these ships that represent the good performance of domestic technical specialists compared to foreigners.

Your company takes the responsibility of ship management of Iran-India shipping and Marin Dadban Co., would you please tell

us about this?Iran-o Hind Shipping Co. is a joint company between IRISL and the Indian partner. Because of the pressure exerted by the Western countries during the sanctions, the Indian party was reluctant to continue the cooperation, so the operation of Iran-India Shipping Co. was actually stopped and business plans of two tankers and four bulk carriers of Iran-India Shipping Lines Co. were disturbed. Meanwhile, a number of tankers were also added to the fleet of IRISL during the sanctions and the number of these ships totally reached to 21 and it was under the management of Marin Dadban Co. due to the sanctions conditions. This company has somehow used three Indian intermediary companies in order to be able to supply and purchase the necessary supplies. Inevitably, at that point, IRISL paid 1.5 million USD per year to intermediary companies. By obtaining approval from senior management of the company at 2016, the management of these ships was transferred to ROD Ship Management Company. Accordingly, while avoiding the withdrawal of $1.5 million from the country, technical management of 17 tankers and 4 bulk carrier of Iran o Hind Shipping Lines Co. was at the disposal of this company. By inclusion of these 21 mentioned ships under the management of ROD Ship Management Co., the number of ships of this complex reached to 90.

When will 10 ships be added to the fleet being ordered to the shipbuilding in South Korea?Fortunately, based on the policies adopted, the number of ten ships (four mega-size ships and six tankers) will be added to the fleet during 2018 and 2019. However, due to the high average age of the fleet,

the fleet development should still be continued. Currently, IRISL has the first rank in the Middle East and this brand should be maintained. In this reason, ministries and national authorities should pay attention to keep this rank; we will lose many advantages by losing this rank. We hope that the average age of the fleet reduced from 15 to ten years by removing obstacles and ordering and buying newer vessels.Based on the plans made by Hyundai Shipbuilding, the steel cutting of the first mega-size container vessel will start on 3 July of this year and the first ship will be delivered on March 2018, in other words, on average, IRISL will receive every month and a half a ship from the next eight months and the total number of ships will be delivered to IRISL during 17 months. Technical Affairs and R&D department of ROD Ship Management Co. in coordination with the Office of Studies and Supervision of fleet affairs of the technical assistant of IRISL played an effective role in finalizing the contract for ordering 10 ships.

How do you assess the future of ROD Ship Management Co.?The vision of Ship Management Co. in 2017 is so technical and professional so that we could keep the company’s assets. Hope to God Almighty, the first priority of this company is the installation of comprehensive Ship Management Software (MESPAS), equipping the fleet vessels with V-SAT satellite communication system and equipping and deploying fleet vessels with VIDEO-TEL educational package so that the asset of shipping will be maintained and insured for years by deploying these packages.

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Given that the sanctions on Iran’s national fleet have been lifted, what plans has IRISL made in order to promote its current position and thrive?It is well known to all that IRISL as national shipping company of Islamic Republic of Iran has been under , what they recall , crippling sanctions of USA and European Union as well as unilateral sanctions imposed by certain countries.Nonetheless, IRISL could overcome hardship of sanctions and survive that constraining condition.Banking transaction , maintaining agencies network, cargo documentation and issuance of B/L, privileges in using IACS member classification societies as well as international hull and machinery insurance companies and IG group members of P&I clubs and flying flags of convenience in compliance with charterers need are among those constrains which might be pointed out here.Though, despite all these limiting conditions, IRISL could fulfill its obligation and meet the very basic requirements of the country in marine transportation sector to its best.IRISL took the consequences of all those years on its shoulder.Absence of standard spare parts and access today’s technology had its own effects on maintenance of fleet vessels and the relation with charterers and clients were affected in view of impose of those limitations.Lifting sanction, following implementation of JCPOA on January 2016 opened a new era for IRISL to initiate an effort to compensate losses and damages

Given the new setting in Iran’s maritime industry and the most recent developments in this industry worldwide, Payam Darya magazine conducted an interview with IRISL General Manager of International Affair, Captain Abdolreza Valefi.This issue of the magazine will focus on the first two questions, and the responses to the rest of the questions will be published in the upcoming issues.

JCPOA:

Start of a New Era for IRISL

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sustained to the company during these eight years and also to pursue its strategic plans in many aspects including fleet expansion and regaining its share from the market, mindful to promote the brand of IRISL among top world carriers.The change in circumstance was drastic.Presence of myriad foreign delegation and shipping corps in IRISL headquarters in an attempt to make a tie in various sectors such as technical cooperation, chartering, new building, finance, insurance and brokerage were the first signs of an atmosphere free from any obstacle and sanction.Many MOUs and Agreements were signed and establishment of many Joint Venture Companies were agreed, demanding an immediate effort to make the plans operational towards the interest of the company, and ultimately the country.Finalizing the old building projects with HHI is perhaps the golden achievement of the company in which the blocked fund of IRISL after eight years was converted to new building contracts of modern vessels to the today’s need of charterers and clients with full conformity with trade patterns and country’s need.The price of the vessels were also modified from the highest in 2008 market to today’s price.The entire project was also subjected to Finance of Korean banks.In any aspect you look to the gained package, you would find a sterling success which in turn implies sincere effort put during the negotiation. See a need to highlight here the extraordinary effort put personally

by the chairman and Managing Director of IRISL during these negotiations driving ahead the policies and serving the interests of the company to its best.Also, support of the board of directors members during the meetings is among those factors ensured the success of negotiation, without which, this achievement would not have been possible.

Considering the shipping and maritime industry is moving toward digital smart technologies, what plans do you have to adapt yourself with this new trend?Digitalizing all the steps required to move a container from one part of the world to another could take a large amount of cost out of supply chain, besides technology provides us with possibilities to do different things that we could not do until few years ago. However, reviewing the history of e-commerce in the container shipping sector clearly shows that none of new initiatives being launched now are truly new.Digitalization will mean a change of behavior by both carriers and shippers But it could go very fast once you have the capability to deliver the customer experience.How it will alter container shipping and whether the impact will be positive or negative, is hard to say.What I do think is that change will come.Even the biggest and most technologically advanced companies realize that they will have to look outside, and beyond the traditional maritime sector, to find the knowhow they need.

The general believe is that it will bring in new customers and eventually offer better services and save costs. And hence in today’s environment, you cannot afford not to go digital.At the moment, there may be many interactions involving documentation along the supply chain that could be digitalized. Typically, the shipper and consignee may have to deal with tens of different entities, such as customs, terminals, forwarders and carriers, creating a stack of paper required to arrange a shipment.Container lines are buying in skills as they prepare to digitalize the services they offer, without having a clear idea of how their companies are likely to change in the era of Amazon, Uber and Alibaba.Both Maersk and CMA CGM, two of the world’s largest container lines, have spoken frankly about the challenges they now face as the business world and customer behavior continues to evolve at astonishing speed.Maersk is also gearing up for the digitalization of container shipping services which, could happen quite suddenly.This potential rapid change has persuaded Maersk and CMA CGM — and presumably others — that they need to acquire new skillsets quickly could be a provoking concern for IRISL. However, it is very important to note that not everyone is convinced that digitalization is going to transform the container shipping world beyond all recognition.

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JCPOA:

Iran’s Membership in International Insurance Clubs

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The re-entrance of Iran’s national fleet to international markets after the execution of JCPOA coincided with tremendous transformations in the field of insurance. How many international insurance clubs is IRISL a member of currently? How many ships are covered by these insurance clubs?Prior to the execution of JCPOA, IRISL had extended its negotiations and written communications to all international insurance companies, from hull insurance to machineries insurance companies and international clubs, in the pursuit of reducing insurance risks for IRISL fleet and dividing purchasing insurance services from various insurance companies.In the sanctions’ era, Iran was harboring a large number and a wide variety of risks, whereas such risks are incompatible with Iran’s interest under regular conditions. Naturally, Iranian insurance companies’ capacity of risk taking is restricted, and they simply cannot accept taking adventurously high risks. Thus, insurance companies all agree that delegating extra risks to international reinsurance

companies and distributing risks among various insurance companies is a good idea.This procedure is not limited to Iran only, and insurance companies in every country cover risk up to a certain maximum limit, and delegate to other domestic or foreign insurance companies the rest of the risks that they are unable to cover due to their insufficient capital.It was promising that once JCPOA was executed in 2016, it paved the way for IRISL to collaborate with and use the services of international insurance companies. In the field of hull and machineries, no risk has been delegated to foreign insurance companies since Iran’s Central Insurance believes ample capacity for risks in this field already exist in the country. Nevertheless, given that ensuring ships’ operation is a specialized matter and the domestic restrictions in the field, we do believe that using the services of some foreign insurance companies alongside Iranian firms will transfer their knowledge and experience to Iranian insurance community, and therefore, it will ultimately benefit Iranian shipping. In the field of liability insurances or P&I, we are facing more

Every day, Iran’s national fleet witnesses a new achievement, and this achievement directly reflects on all sectors of Iran’s maritime trade. As far as ships’ insurance and owners’ accountability are concerned, the Joint Comprehensive Plan of Action (JCPOA) has promisingly brought about noticeable benefits for the national fleet, including Iran’s membership in 3 international clubs, IRISL director’s membership in the P&I Club board of directors, and an increase in the maximum limit of reinsurance provided for IRISL fleet up to $1 billion. In an interview with Payam Darya Magazine, the director of IRISL Insurance Brokerage Office, Captain Mohammadreza Mohammadi Banaei, delved into the details of these recent maritime insurance achievements.

has purchased insurance coverage from 3 international clubs

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serious issues such as oil pollution, environmental issues, third-party claims, and for and against claims, which usually occur in international waterways or foreign ports. In the era of sanctions, all these risks were covered domestically, and in case any incidents occur, the entire compensation had to be paid by Iranian insurance companies from the government-supported reinsurance fund, and this was inevitable due to the restrictions imposed on us by the sanctions. Therefore, with the agreement of Iran’s Central Insurance, we decided to delegate the coverage of disastrous accidents such as oil pollution to foreign insurance companies. To this end, IRISL has purchased insurance coverage from 3 international clubs – Skuld, West of England, and Steamship – and so far, 77 IRISL ships and Valfajr Shipping Line have been covered by P&I liability insurance from these clubs.

Could you please fill us in on the membership of IRISL senior management in the London Insurance Club’s (P&I) Board of Directors?One of the issues that IRISL was actively pursuing was the presence of an IRISL representative in the P&I’s assemblies and the board of directors. We finally managed to earn the agreement of Steamship Club’s board of directors in this regard, and this was a worthy step. This way, not only was IRISL accepted in the club as an insurance service receiving member, but it also managed to earn a seat for its representative in the club board of directors. As

of the ships that travel in the international waters are covered by 13 insurance clubs, and each club is composed of a considerable number of ship owners. Meanwhile, the owners who hold the largest total tonnage volume are accepted into the board of directors. The members of the board play the key role in the decision making and policy making procedures of the club.

In the new era of collaboration, to what extent have the international insurance clubs increased the maximum reinsurance amount for Iran’s national fleet?The agreement and collaboration among the 13 international clubs has led to world’s largest reinsurance contract, in a way that the power and capacities of these clubs are able to cover the damages of IRISL fleet up to billions of dollars. Therefore, Iran’s presence in this structure and alongside other world-renowned shipping lines could be considered a great success.As I already stated, IRISL fleet’s maximum insurance coverage for oil pollution is one billion dollars; nevertheless, given the structure and overlap of the clubs, even the damages over $1 billion to third parties could be covered.

How effective has the execution of JCPOA been in this field?IRISL is a player in the international trade, and naturally, playing in the international trade demands IRISL’s maintaining close interactions with all countries. Inevitably, any limitations in this regard will practically restrict Iran’s trade. Hence, it means IRISL to keep

Once JCPOA was executed in 2016, it paved the way for IRISL to collaborate with international insurance companies

you are already aware, the IRISL director, Dr. Mohammad Saeedi, has been introduced to the club as IRISL director representative, and we do hope that we are able to promote our interactions and collaboration with the club thanks to Dr. Saeedi’s presence. What benefits does the presence of IRISL in international clubs can bring about for Iran?Approximately, 90 percent

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playing in the international trade; we need to establish trade with various countries around the world. The flourishing and thriving of the shipping industry depends on its ability to venture freely and limitlessly to different ports of the world with a large fleet and different products. Promoting shipping activities could be a source of income, economic boom and entrepreneurship. If our trade partners are restricted to few countries only, our revenues will practically decrease, and never could accomplish our high-held goals, which is being a world top-ten in the shipping industry. JCPOA greatly assisted us in establishing better ties with the countries that are willing to collaborate with Iran.In addition, JCPOA made remarkable contributions to the activities of insurances.

Insurance companies are financial firms in their nature, and any banking limitation is actually an insurance limitation, as well. However, international insurance companies could solve these problems to some extent thanks to their interactions with IRISL, Iran’s national Tanker Company and other Iranian maritime companies. They managed to convince other counties that offering insurance services and providing insurance certificates to Iranian companies have to be done through international clubs, since this matter is not just to meet Iranian interest but to cater for international interests as well. No doubt, these matters only have taken place as a result of Iran’s agreement, ties and behavior after JCPOA, and should this trend continue, more and more new markets are attracted to Iran day by day.

90 percent of the ships that travel in the international waters are covered by 13 insurance clubs

The IRISL Multimodal Transportation Company Announces:

Purchase of New Container Wagons and Boosting of Rail Transportation

Container transportation is the main activity of the IRIL Multimodal Transportation Company’s functions, 90% of which are undertaken by road. By procuring new container wagons, MTC has set its eyes on rail transportation.Talking to the Payame Darya Reporter, the Managing Director of the IRISL Multimodal Transportation Company pointed to the fact that the multimodal transportation in the country is moving towards improvement and said: “The relevant officials view the multimodal transportation as a combination of road and rail but we are trying to establish the idea that multimodal transportation is the connection of rail and road with the sea involving the issue of a single general bill of lading as far as the final destination.”

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Capt. Ali Hossein Farokhi added: “In a multimodal transportation we must use ship, road and in particular railways to increase added value, reduce costs and provide better services to customers. In other words, one of the means of transportation in such a system should be the sea, but unfortunately this is still not quite established in our country.”Pointing to the field of activities of the IRISL Multimodal Transportation Company, Farokhi said “If we want to encourage others to use this mode of transportation, the IRISL Multimodal Transportation Company must have a great role to play in. By issuing the general bill of lading, MTC has the task of transporting goods from the origin to the final destination. I therefore believe the authority for multimodal transportation must be the IRISL Multimodal Transportation Company.

Stating that MTC used more the road and sea transportation than the rail, the Managing Director of the IRISL Multimodal Transportation Company said: “Of course our aim is to use the existing capacities in railways to the advantage of the multimodal transportation, because railway is the most appropriate substitute for road. In this context, the necessary plans are being drawn to procure equipment in the railway sector to be able to improve quality while reducing costs.”Pointing to the ongoing and completed investment in the rail transportation sector, he said: “At any case the interest of railway transportation is a national one and we hope to gain a good status with our ongoing plans and to use more of the rail’s capacities.”He described the container transportation as being the main current activity of the IRISL Multimodal Transportation

Company and added: “Container transportation at sea is undertaken by Hafez Darya Company and on land by IRISL Multimodal Transportation Company, involving 90% road transportation. In this respect, we are determined to move the main bulk of containers by rail through procurement of container wagons.”He continued: “As for transit, we intend to create terminals at borders including the Sarakhs border to be able to use our rail capacity.”Referring to the general preference of road over railways, he said: “From the access point of view there are freedoms in road transportation, which are not available for railway, while from the point of view of expenses also there are no access fees for road, whereas this cost is taken into consideration in rail transportation. These obstacles have led to transit by road being the preferred mode.” Farokhi assured: “By interacting with the National Railways and by securing planned train schedules and discounts, the IRISL Multimodal Transportation Company has tried to reduce the time and cost of transits.”The Managing Director of IRISL Multimodal Transportation Company reiterated: “This Company has always functioned as a subsidiary of Islamic Republic of Iran Shipping Lines to let our contractual parties know that their cooperation in facilitating transit in not with a small rail company.”In the end he expressed hope that in the light of efforts made by the Ministry of Road and Urbanization, the multimodal transportation would gain a special status. 3535

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The pace of changes in both Information Technology (IT) and Information and Communication Technology (ICT) will continue to hasten. These changes are rooted in advancements in storage technology, computer processing, social media platforms and the ever-increasing number of products containing sensors and embedded software. An uprising in ICT will be an evolution in the shipping industry. Newly discovered technology are introduced and used extensively in Shipping and we see new technology pathways that will transform the industry. The world will be the witness to a more connected, integrated and efficient shipping industry over the next few decades due to the improvements in ICT. In this regard, more data can and will be collected, analyzed and integrated into the decision making process at all the levels. Considering all the above-mentioned, IT and ICT’s roles in shipping led Payam Darya Magazine to conduct an interview with the managing director of Marin Information Technology Development Company (MITD) Co., Mohammad Reza Damavandi, the transcription is given as follows:

MITD to Provide Marine Industry with Software

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What kind of services dose the Marine Information Technology Development Co. provide for the vessels of IRISL and other shipping companies?

Computers have become an integral part of day to day operation of shipping. Computers are used on vessels for enhancing performance for shipboard and commercial operations.Marine Information Technology Development Co., (MITD) provides shore-based services to support maritime industry in IT and ICT field. MITD CO. has established a comprehensive network of support facilities in Iranian southern and northern ports which would provide rapid-reaction services throughout Iranian Ports on a 24/7 basis. MITD CO. engineers are professionally trained, with extensive knowledge and experience in their fields and their skills are continually updated to keep pace with new technologies.Currently MITD supports and maintains more than 150 ocean going vessels in IT, ICT, control, monitoring, NAVAIDS and GMDSS equipment.

Could you please explain the manner in which MITD collaborates with international companies in the mentioned field?

In the spring of 2016 negotiations started between MITD and reputable overseas companies. Fortunately, the company was able to sign agreements with most of role players in this field. Among them, Danish company Danelec VDR (Voyage data recorder) and ECDIS producer, Norwegian company JOTRON

marine safety and electronics equipment manufacture, French company Marlink marine internet service provider, Swiss company MESPAS software development company, Cyprus Company OneNet marine internet provider and Japanese company FURUNO marine electronics and communication manufacturer can be named. Moreover, we believe in the development of enterprise transportation software solution, in addition to its financial achievement, MITD can gain a reputable position in the international market.

How do you evaluate the implementation of JCPOA and lifting of the sanctions in the development of IT industry in the marine sector?

After JCPOA (Joint Comprehensive Plan of Action), sanctions were removed and, it became easier to access international markets in all the areas. Iran’s ICT industry also benefited from this opportunity. Increase of willingness of European and American companies for cooperation in the field of ICT and deals between Iranian companies and overseas companies in the mentioned field, are the most important achievements after JCPOA agreement in the information technology industry. Similarly, marine IT industry has benefited from these opportunities and subsequently the cost of information and communication technology implementation has been dramatically reduced by direct business transactions between overseas marine ICT companies and Iranian marine companies. Furthermore, it has also created opportunities to transfer

MITD as a leading company in marine IT and ICT in IRAN has formulated a new strateg

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knowledge from manufacturers to Iranian marine companies.

Considering the increasing speed of Internet in Iran and the rise of social networks, what platforms are planned for the development of activities in the field of IT and information industry to create added value?

Implementing social networks can add value in the organization’s functions. It can improve organizational performance by utilization of collaborative tools for intra-organization and inter-organization communications.Moreover, it generates huge amount of data about customers in real time which leads to smarter business decisions by giving us more insight about the customers. Employing social network can enhance marketing interactions and sales activities by running targeted ads with real time results. It can also increase customer loyalty by opening direct communication channels between the company and customers.

According to the Statistical

that inexpensive activities are possible. Accordingly, does the Company, Marine Information Technology Development Co., play a role in this regard?

Based on IRISL chairman Dr. Saeedi’s policies, MITD as a leading company in marine IT and ICT in IRAN has formulated a new strategy. Considering the software requirements in the area of shipping and related services, the company recruits expertise in software development to carry out new projects with maximum quality.Based on the above strategy, the company has started to develop different software in the marine industry. Among them, commercial software (named ShipCommerce) covering full range of requirement from vessel operators to agencies, container port management software, fuel management software (FMS) can be named. Upon release of these products, not only our sister companies in IRISL will utilize them to enhance their business processes, but also we will have the opportunity to export the products both to domestic and international markets.

Center of Iran, last year’s income from IT and ICT sections recorded more than 17 billion dollars. In this regard, which sectors are the main fields of activities of Iranian companies that generate wealth?

The main activities of the world’s top IT companies are hardware production, software development, retail and cloud computing. While in Iran internet service providers enjoy the largest revenue among other IT companies. The main tendency of Iranian ICT/IT companies and the market is toward internet services which are normally provided by large companies such as Telecommunication Company of Iran. Down in the list, the second highest revenue belongs to E-payment providers which have been widely used by individual during the past few years.Software development (ERP, tailor made, applications…), network and hardware services, content production and information system support come in the lowest ranks.IT and ICT are among the service industries and huge profits are recorded at the same time

Emission, Recyclingand BWM

Marine

By : Mehdi RastegarySina Ports and Marine Services Co.

The Ballast Water Management

Convection and its Impacts

on the Shipping Industry

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A r t i c l e

Head of Research and Development, Sina Ports and Marine Services Co. By the rise of global dependence on the maritime transport in the past decades, shipping is seen as one of the most essentially needed industries for sustaining human life on the planet. E. Mitropoulos once said: ‘Without shipping, half the world would freeze and the other half would starve.’ In other words, with dependence of 90 percent of international trade on the shipping, our globalized world cannot be perceived without it. Although shipping is seen as one of the most environment-friendly modes of transport, the scale and scope of activities in the industry amasses the large magnitude of the environmental aspects and impacts of it on the worldwide scale. This has raised global concerns on several environmental aspects of shipping and their consequences in terms of pollution control and environmental resources management. Yet, the industry is standing on the horns of a dilemma: on the one hand, the shipping shall take immediate and effective measures to keep itself in the track of sustainable development. On the other hand, in the current deteriorated markets, the expenses of environmental measures seem like a hefty burden to the firms in the industry. Among the critical aspects of the shipping industry, Ballast Water Management (BWM) has proved to have significant impacts on ecosystems, food chains and people’s way of life. It is estimated that the merchant shipping transfers 3-5 billion tons (equivalent to 3-5 trillion liters) of ballast water throughout the world annually. Ships are largely dependent on ballast water and they are designed to carry huge amounts of ballast water. The following table provides the ballast water capacity of various types of ships as a percentage of their DWT.

The ballast water is a key element in keeping the ship’s stability and seaworthiness. The Ballast waterfunction is most important in cargo loading and unloading operations in ports where the ship’s stability is maintained by deballasting and ballasting. These operations are also practiced for navigating in shallow water areas, raising the vessel’s bow for sailing in storms, trimming the stern to balance the fuel consumption enroute , lowering the airdraft of vessel in certain operations, and minimizing hull tensions. In terms of biosecurity, the ballast water in maritime transport can act as a vector for conveying Harmful Aquatic Organisms and Pathogens (HAOPs) from one part of the world to the other parts. The HAOPs include pathogens, planktons, algae, eggs, larva, or other organisms that if introduced to the marine environment or the fresh water resources can hazard human health, property, environment, biodiversity, or other legitimate use of such areas. HAOPs come 4141

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in large quantities and variety in the ballast water and can contribute towards loss of marine species, harms to the food resources of human or marine species, and health risks for human from contamination of water to food chains.

-Among the historically environmental disasters caused by HAOPs we can point to:• Outbreak of golden mussels in South America and its devastating effects on fisheries (since 1990s);• Spread of Mnemiopsis leidyi (comb jelly) in the Black Sea Azov, Marmara and Eastern Mediterranean and its contagion to the Caspian Sea and its tragic effects on marine ecosystems and fisheries ( since 1982);• Release of Vibrio cholera from Ballast water to drinking water resources in Peru that was accompanied by an epidemy of cholera that infected one million people and killed 10,000 people (1991);• Deterioration of food webs by spread of Zebra mussel in Great Lakes ( since 1980s).The containment of ballast water risks has been a significant issue at the international level for decades and a great number of legal instruments and initiatives have been developed to address it, including:

The Convention on Biological Diversity (CBD) has been adopted and practiced by UNEP members since 1992 to address the protection of biodiversity in ecosystems. In 1995, the contracting parties to CBD also adopted the “Jakarta Mandate on Marine and Coastal Biological Diversity” which included the introduction of alien species as a thematic issue.

IMO has raised the issue since 1973, the year of adoption of MARPOL convention, by pointing to the potential presence of pathogens in the ballast water in her resolution and requesting the joint study of WHO and IMO on the issue.

Later in early 1990s, IMO organized a Ballast Water Working Group under the Marine Environment Protection Committee (MEPC) that has

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been continuously working to address the issue effectively. In 1991, the working group published Guidelines for Preventing the Introduction of Unwanted Organisms and Pathogens from Ship’s Ballast Waters and Sediment Discharges, and updated it in 1993. In 1997, it published the ‘Guidelines for Control and Management of Ships’ Ballast Water to Minimize the Transfer of Harmful Aquatic Organisms and Pathogens (Resolution A.868(20)).

Following her work on the issue, IMO prepared the Ballast Water Management (BWM) convention, which was adopted in February 2004. Further, IMO adopted over 15 sets of guidelines and other documents contained in its Marine Environmental Protection Committee (MEPC) resolutions and circulars.

IMO also participated in launching the GloBallast initiative with Global Environmental Facility (GEF), and UN Development Program (UNDP) in 2000. The Globallast program has acted towards making a global momentum in implementing IMO ballast water guidelines, reducing the transfer of HAOPs in ships’ ballast water, and preparing for implementation of BWM convention in the past 17 years.

Ballast Water Management Convention After decades of international concern and follow-up of ballast water issues, the Ballast Water Management Convention will eventually come into effect in September 2017. This convention that enjoys the accession of 58 parties and involvement of more than 35 percent of the global merchant shipping tonnage, requires all ships of 400 gross tonnage and above (including existing ships, except floating platforms, FSUs and FPSOs) to possess International Ballast Water Management Certificate (IBWMC). This is an important milestone in terms of global biosecurity.

As a groundbreaking legal instrument, the BWM convention involves the interplay of coastal states, the port states and the flag states in their regulation on the Ballast Water issue. It is expected that the synergistic resultant of such regulation and enforcements can drive the merchant shipping towards mitigating the adverse impacts of ballasting throughout the world. Ballast Water Management Convention (2004) structureSources: IMO (2005), Lloyd’s Register (2014),American Bureau of Shipping (2017) 4343

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Compliance with the BWM convention is emerging as a basic requirement for the owners and operators of ships around the world. The Ballast Water Management process depends heavily on ship type, trade pattern, operation systems, and technology and may differ significantly from one ship to another. In this sense, the ship owners should work closely with ship operators, ship designers and builders to develop an efficient and effective BWM system in the ship.

In order to prepare for compliance with BWM convention, each ship requires:

Outlining the ship’s obligations under the Ballast Water Management Convention

Review of the existing Shipboard BWM arrangements Development of the ship’s Ballast Water Management Plan (BWMP) Assigning a Ballast Water Management officer Selection and installation of a Ballast Water Treatment System Developing an efficient training program for the ship’s staff Development of final BWMP Submission for survey and certification

The BWM convention requires each ship to develop and maintain a Ballast Water Management Plan. The BWMP explains the needed actions to implement the BWM convention requirements in detail, and elaborates the resources, responsibilities and timings of such actions in terms of procedures. BWMP needs to be documented for each ship and approved by the administration and submitted for the surveys of the flag state or competent classification societies. The document will be used as the main reference in the surveys of the ballast water management system. The BWMP document should include:

Ship particulars Record of circulation Record of Amendments Purpose of the Plan Plans and drawings of the ballast system Description of the ballast system Ballast water sampling points Operation of the ballast water management system Safety procedures for the ship and the crew Operational or safety restrictions Description of the methods used on board for ballast water

management and sediment control Procedures for the disposal of sediments Methods of communication Duties of the Ballast Water Management Officer Recording Requirements Crew training and familiarization Exemptions

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The flag state or a competent classification society surveys the equipment, procedures, documents and practice of Ballast Water Management for compliance with BWM convention and in case of acceptable conformity, the flag state will provide the ship with an International Ballast Water Management Certificate (IBWMC) or a Certificate of Compliance. The BWM convention requires that BWMP, BWM record book, and IBMWC (or a certificate of compliance where the flag state has not ratified the convention) to be always available aboard the ship. In order to practice the BWMP in compliance with the BWM convention, the following steps shall be implemented by reliance of the former planning:

Identifying and appointing the Ballast Water Management Officer Training the staff on the Ballast Water Management practice due to the

BWMP Full implementations of all BWM procedures according to the ship’s BWMP

and ensuring the compliance with BWM convention in the discharge of ballast and sediments.

Keeping the BWM record book up to date Operations and maintenance of BWM equipment according to the

manufacturer’s recommendation Monitoring the performance of the BWM system aboard the ships Reviewing the BWMP by considering the performance, the emerging

requirements (e.g. for sailing in a new shipping route), corrective and preventive actions, the results of surveys, and the recommendations for improvement.

Ensuring that the surveys are kept in place in terms of the commensurate timing. Although some solutions like Port Reception Facilities and Return-to-Origin of ballast water are also considered, Ballast Water Management is mainly underpinned on practice of two sets of IMO standards, namely D1 standards for Ballast Water Exchange (BWE), and the D2 standards for Ballast Water Performance. These general standards provide the basis for developing the ship-specific Ballast Water Management Plan (BWMP) for most of the ships. According to Regulation B-3 in BWM Convention, all ships are required to meet the IMO-D2 standard on ballast water performance standard. Yet, as the ballast water exchange will be maintained in the industry, IMO-D1 standard will apply to it. Up to the date (May 2017), Ballast Water Exchange between the coastal origins and open waters in oceans and seas has been the most implemented BWM method. It is assumed that the oceanic environment is inhospitable for species that live in the coastal, estuarine, and fresh water environments and the distance between them will not allow the HAOPs to travel back to such similar places. In this sense, IMO-D1 standard requires the ships to conduct BWE at least 200 nautical miles from the nearest land and in water at least 200 meters in depth (open oceanic waters). According to the standard, the ballast water exchange can be performed in three ways:• Sequential Flow Method – This method involves sequential discharge of each ballast tank (to the most possible pumping level) and filling it with oceanic water until 95% exchange of its content is achieved. This is the most widely used 4646

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method in the industry as it takes less time to perform. It can utilize existing pumps and piping systems on the vessel and the operations does not interfere with works on deck. It also does not affect the vessel’s cargo. However the method has navigational and stability restrictions that cannot be overlooked.• Flow-through Method - In this method, the ship in the exchange point pumps volumes of new water into the tank from the bottom to generate an overflow of the ballast content from the top of it. The 95% ballast water content exchange is expected to be achieved by pumping 3-times of volume of the tank into it. Although this method has advantages in maintaining the ship stability and strength which is especially useful in adverse weather conditions, it takes much time and need painstaking control to protect the tank structure, the deck structure, and the vessel’s cargo. It can also be problematic in low temperature conditions.• Dilution Method - The dilution method is the least used method in which new water is pumped into the ballast tank from above while the tank content is emptied from its bottom. Likewise, it is assumed that the 95% ballast water content is achieved by pumping 3-times of the volume of the tank into it. In addition to the advantages of the flow-through method, this level raises the BWE efficiency and enhances sediment control. It also eliminates the risks of exposing the crew to HAOPs. However, the overpressurization in the tank can harm the tank structure. Any changes in the filling level of the tank can risk the ship stability, and specifically the failure of the filling pump can be troublesome.

As a BWM alternative, ballast water exchange has many restrictions as: The time spent in permitted exchange (in oceanic waters) may not be sufficient

for the complete deballasting and ballasting cycle. This is particularly true in the shortsea shipping, and in the liner shipping where the ship calls at many ports on her route.

The loading and discharge of the ballast occurs in the dynamic sailing conditions where the ballast exchange can influence the stability and structural strength of the ship.

From 8th September 2017, compliance with IMO-D1 standard will be mandatory for ships unless the ship install and operate the Balance Water Treatment (BWT) systems onboard or use an alternative method for compliance with BWM convention requirements.Ballast Water Treatment Considering the restrictions of Ballast Water Exchange and other alternative BWM methods, Ballast Water Treatment onboard the ship seems to be the most efficient BWM solution. The BWM Convention is obligating all ships to comply with the IMO-D2 standards and equip with Ballast Water Treatment systems in the following order:• The IMO-D2 standard becomes mandatory for all existing vessels after the first IOPP renewal date following the entry into force date. 4747

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• Vessels keel-laid or underwent major conversion after the entry into force date shall comply with the regulation IMO-D2 upon delivery.According to this standard, the ballast water in ship shall be treated in an environmentally sound way, so that the following concentrations may not exceed in the discharged ballast water:

less than 10 viable organisms per cubic meter, greater than or equal to 50 micrometres in minimum dimension

less than 10 viable organisms per milliliter, less than 50 micrometres in minimum dimension and greater than or equal to 10 micrometres in minimum dimension; IMO-D2 also states that the indicator microbes shall not exceed the specified concentrations as below:

Toxicogenic Vibrio cholerae (O1 and O139) with less than 1 colony forming unit (cfu) per 100 millilitres or less than 1 cfu per 1 gram (wet weight) zooplankton samples; Escherichia coli less than 250 cfu per 100 millilitres;

Intestinal Enterococci less than 100 cfu per 100 millilitres.

Typical arrangement of Ballast Water Treatment System in a ship As shown in the above figure the Ballast Water Treatment is fitted to the ballast tanks and pipings aboard the ship. Several processes, mechanisms and systems have been proposed for ballast water treatment, many of which have been approved and made available in the market. The BWT systems are generally categorized by the types of treatment processes and incorporated technologies in them. These include mechanical and chemical separation of solid particles and organisms from water, and chemical or physical disinfection of it. The following table gives a list of the BWT processes and a brief description for each of them. Most of commercialized Ballast Water Treatment systems incorporate a combination of both separation and disinfection processes. BWT systems are tested and examined by IMO protocols (Guidelines G8 and G9), and 4848

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IMO has published an extensive list of the approved BWT systems, including 56 basic approvals for systems including active substances, 41 final approvals for systems including active substances, and 69 type approval certifications for BWT systems. According to data published by Lloyd’s Register(2017), among all approved and certified systems in IMO’s list, 25 products have established 95.11% of sales in the marketplace (which included the selling of 10631 BWT systems to ships around the world) . As indicated in the following chart, ten ballast water treatment processes have been incorporated in the most purchased BWT systems. 83% of the sold systems use mechanical separation processes and only 13.7% of them did not incorporate such processes. Also 77% of the sold BWT systems utilized chemical disinfection processes and 68.2% of them used physical disinfection processes.

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Selection of Ballast Water Treatment System The selection and specification of the appropriate ballast treatment systems is a very important decision for the shipping business: it is a technically sophisticated, financially burdensome, and strategically critical to sustain the business in the coming years. In making such a decision, a number of interacting cost factors, ship-specific parameters, and ballast system considerations shall be concerned collectively and systematically to equip the ship with optimum ballast water treatment system.

As far as technology is concerned, filtration, Ultra Violet, and electrolysis/electrochlorination are estimated to be the least expensive BWT processes. Accordingly, these are also the most used BTW processes, respectively with 79.3%, 49%, and 35% shares in the most purchased BWT systems.

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The following table provides a list of most-purchased Ballast Water Treatment on a worldwide scale and their specifications.

Key role-players in the conduct of BWM Convention The BWM convention is expected to have significant impacts on the shipping industry. According to a scheme by King,D.M. et al (which is enhanced by the author), there are twelve stakeholders with key roles in the implementation of BWM convention. Let us review the impact of BWM convention on each of them:

International Maritime Organization (IMO) – Entry into force of BWM convention is an achievement for IMO. After two decades of work, the endeavors of IMO has led to international acknowledgement and enforcement of environmental control against HAOPs. Yet, IMO shall still encounter extensive pressures against the intended changes. Such pressures can come from ship owners and operators, trade associations, flag states, non-member states, etc. One instance is the request of some flag states that are requesting for delays in entry into force of IMO-D2 standards, an issue that is expected to be discussed and concluded in MEPC in July 2017. Moreover discrepancies between the requirements of some national authorities (e.g. US Coast Guard) and IMO, and the practical obscurities in this sense has brought some encumbrances to practical conduct of BWM convention.

Flag States –The BWM convention practice is founded and supported by the accession of 58 flag states ( as reported in May 2017). The flag states certify the type approval of BWT systems that can be used aboard ships. Flag states are also the main institutional actors in terms of the surveys and certifications in the BWM context: they issue the International Ballast Water Management Certificate (IBWMC) for the ship that is required to be permanently available onboard along with BWMP and ballast water management record book. The flag states act as the protectors of the benefits of their registered fleet and this can be reckoned as considerable issue, specifically in case of those that function as flag of convenience. Some flag states (i.e. China, Greece, Brazil, Liberia, Norway, UK, India, and Cook Island) have requested for a two-year delay in the implementation of IMO-D2 standard. A number of them (e.g. Marshal Islands) will permit early IOPP survey renewal (before September 2017) for ships under their registry to provide an opportunity for a five year delay for compliance with IMO-D2 for their registered ships. In many cases, this will need a decoupling of IOPP survey from the other ship surveys as outlined by the Harmonized System of Survey and Certification. This may lead to preference of such flag states by the ship owners over others.

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Port States – By Adoption of Resolution MEPC.252(67)in IMO, the port states are requested to inspect the entering ships under the BWM convention. The inspection includes the verification of the IBWM certificate or statement, checkup of the BWM record book, and the sampling of ballast water due to IMO regulations. Some port states (e.g. US ports) may implement more strict controls in terms of their national regulations. The reported incompliances may cause more strict inspections, warnings, prohibition from the ship’s entry or stay in the port , and requiring the ship to exchange her ballast water in oceanic waters or in other safe facilities, or requiring it to undertake any needed repair according to the BWMP. After a 3-years trial implementation of the port states’ controls, the port states can also detain high-risk ships, and apply criminal sanctions against the noncomplying ships. Moreover, the results of the port states inspections are critical to the ship owners and the flag states as the resultant of them will present the positioning of the ship and the flag in the white, black and grey lists reported to IMO. Port state procedures may also conflict with some flag states on issues like the decoupling of IOPP from SS surveys.

The Ship Owners and Operators – The ship owners and operators who are experiencing the pits of their businesses, will have to afford the costs of buying, installation/retrofit, operations, and maintenance of Ballast Water Management systems. . A BWM system can cost between five hundred thousand to five million US dollars. It is estimated that by entry of BWM convention into force, around 50,000 vessels around the world are obligated to have such systems onboard by 2020,and according to ICS the total incurred costs in the industry can reach 100-billion USD. This is occurring in a market where:

• Within the 2030 horizon, the average long-term seaborne trade volume 5454

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growth is forecasted to be as low as 1 percent per year.• The supply of shipping is outpacing the demand. Between 15 to 20 percent of the capacity of shipping fleets in the global level are idle, and the potentials for the improvement of utilization rates is low.

• The freight rates are faintly rising from their historic bottom levels in 2016.

• The economic lifetime and the asset value of ships are declining.• A general rise in the fuel prices is expected, with some other rises coming from air pollution control regulations ( one report estimating up to US$60 billion of additional costs for the industry from 2020 in terms of Sulphur cap requirements).

• The shipping revenues have experienced a freefall in comparison to the 2000s, when the BWM convention was adopted (see the chart below).

In other words, the BWM convention is entering into force when the shipping industry is in her worst shape. This can accelerate undesirable trends like increases in early ship demolition or filing for insolvency among the ship owners and operators.

Masters – The shipmasters play a critical role in the implementation of BWM convention. Acting as the commander of a ship, master is the one who is practically in charge of operating the ballasting operations inline with other functions of the ship. The masters are responsible for organizing and resource mobilization for compliance with BWM convention requirements in the BWMP, briefing (and possibly training) the staff and crew, regulating the conduct of ballasting procedures, deciding over operations affecting ship structural strength or stability, validating the BWMT systems functional effectiveness, verifying and undersigning the records of BWM, and many more. In other words, due compliance of the BWM convention’s requirement totally depends on the masters’ attitudes, behaviors, and actions.

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National Regulatory Bodies – as mentioned, the BWM convention enjoys the accession and support of 58 states and IMO is inviting other states to ratify it. Moreover, transnational regulatory bodies are calling the states to ratification and compliance with this convention and other environmental management instruments. For instance in Regulation (EU) No 1143/2014, the European Parliament and Council invite the states to ratify the BWM convention and comply with it. In other parts of the world, some national regulatory bodies are demanding compliance with differ-ent requirements in terms of national regulations. One good instance is the US Coast Guards regulations. There are several discrepancies between the conducts of BWM convention and USCG/EPA ballast water management including the pre-arrival re-port, methods of ballast water sampling, self-monitoring of BWM performance by the ship in terms of Vessel General Permit (VGP), requirement of Alternate Manage-ment System (AMS)’s certificate with temporary approvals from USCG for the com-ing five years, and the provided list of type approvals for the ships entering into US ports. This has raised the obscurities around the selection and installation of ballast water treatment systems for the ship owners. Classification Socieities- as the main implementers of surveys and inspections, classification societies act mainly as the arms of the flag states. As they are directly and practically involved in the surveys and inspections, their performance has significant effects on regulation and compliance levels in the field. Moreover their extensive knowledge and experience can be seen as a rich resource for innovation in the BWM convention context.

Charterers and Cargo Owners- Entry into force of the BWM convention also affects the charterers and cargo owners as the major customers of the freight industry. Due to the recorded figures of purchased ballast water treatment systems at the date of BWM convention’s entry into force, a great number of ships have not been equipped according to the IMO-D2 standards. Accordingly, many ships cannot comply with the convention’s requirements and will not be eligible for calling at a great number of ports. This can affect the supply of the ships, and the chartering and freight rate in many shipping routes. However according to the current trends in the industry, compliance with BWM convention cannot be seen as a long term competitive advantage in the freight industry and it is rather considered as a basic characteristic of fungible vessels in the future of shipping.

P&I Clubs and other Marine Insurances – The BWM convention will bring a new set of requirements into force, and noncompliance with it will incur fines and penalties to ship owners and ship operators. The P&I Clubs will be reluctant to indemnify such losses as it opposes their intents for mutual benefit and risk minimization. P&Is will also see such noncompliances as bad records for the newly joining members and the existing members. Therefore we can expect that P&Is contribute towards enhancement of the worldwide compliance with the BWM convention. The marine insurances will also act in the same direction.

Trade Associations – The shipping associations (ICS, WSC, BIMCO, INTERTANKO, etc.) are generally trying to act as the voice of ship owners and operators in the international level. Nearly all of them support the purpose of the convention, and yet they are trying to alleviate the harsh existing conditions for their members. Indeed, they sound to be more realistic than governments, and international regulatory bodies. They are requesting for supports like two-year delay in IMO-D2 implementation scheme, adoption of a revised mandatory type approval code by IMO, minimal effects of ballast samplings on ship operations in ports, acceptance of 5656

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first generation of IMO-type approved BWMS in ports, cost-neutrality of tests and inspections of ports and national authorities on ships, etc. In addition, such associations can function as sources of consultancy, boosters of research and development, and organizers of Communities of Practice for implementation of BWM convention.

Shipyards and BWMS manufacturers- The entry into force of BWM convention has developed a very large demand and a lucrative marketplace for the BWMT systems. Due to the hard financial conditions of the ship owners and operators and the uncertainties in selection of the type approved BWMT, only one-fifth of the fleet has been equipped with the needed IMO-D2 systems. On the other side most of the available BWT systems are technologically novel and practical use of them may require enhancements in them. The resultant demands for installation and/or improvements of BWT systems in 40,000 ships (and 10.6 thousand formerly equipped vessels) within the coming five years will also entail a jam in the shipyards. Although shipbuilding activities have slowed down considerably in the past two years, many shipyards have been closed. Such work peaks can congest the shipyards with a following lag in the entire maritime transport pipeline.

Professional Initiatives – Within the past years, a number of global initiatives have been developed to boost the implementation of BWM convention. The most renowned initiative is Globallast that has been in place from early 2000s. Such initiatives can be utilized to serve the implementation schemes in many ways including knowledge and information exchange, training, online access to compliance records, knowledge leverages, and many other functions.According to the depicted roles of these interacting stakeholders, along with the targeted improvement of the merchant shipping’s environmental impacts, the requirements of the BWM convention can lead the industry to grave problems in near future. In this sense, the entry into force of the BWM convention is a great challenge for the shipping industry.

The Impacts of BWM Convention on the Shipping Industry The entry into force of the BWM convention is an undoubted milestone

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in terms of the management of environmental impacts of merchant shipping. We mentioned that merchant ships transfer 3-5 billion cubic meters of ballast water around the world. The historical evidences plainly show that ballast water can be the vector for conveyance of invasive organisms from one part of the world to the other parts. Such species have the capacity to harm the ecosystems, economy, and human health. However, this big change is happening in hard times of the industry that are characterized by weak demand, high oversupply, freefall of freight and charter rates, reduction of asset values and their economic life, reluctant financiers and investors, and emaciating businesses and firms. While the ship owners and operators are under severe pressures, the requirements of environmental protection are building a new gradient of costs and restrictions in the industry level that will trigger a negative cycle: a) It is estimated that the installation of Ballast Water Treatment systems will incur a total cost of 100-billion USD in the industry level; b) Most ship owners and operators are suffering indecision in selection of BWT systems as a matter of existing obscurities; c) Many of the BWT systems are based on novel technologies and may need enhancements in the practical use; d) The accumulated number of installations needed in the global fleet is many times more than the available shipyard capacity; e) If the ships do not succeed in equipping themselves with BWT systems, they will have to suffer the consequences of non-compliance with the BWM convention in the months ahead; f) And eventually the shipping lines shall endure the equally heavy costs and restriction of other forthcoming environmental management conventions in the same period. The mentioned negative cycle will plainly act towards deteriorating the shipping markets. It will strengthen a number of destructive trends including increase of costs, hardening the cash flow management, harder entry of many ships to many ports, reduction of revenues, diminishing profitability, and adding restrictions into the industry’s business environment. It will also contribute towards lessening of asset value of ships and reduction of their economic lifetime, increase of early ship demolitions, development of a high-risk and intimidating profile of shipping for financiers and investor, bringing the ship owners and operators to the verge of financial crisis, and shifting the market structure towards a more concentrated oligopoly. Considering the critical role of shipping in the modern global economy, it is definitely the time to ask whether these harms can be avoided? Why should we haste into such an abysmal destruction of shipping? It is time to slow down and pace thoughtfully to avoid the unnecessary harms. We should tackle many issues before taking our other step: the type approval issues shall be resolved to allow the ship owners to decide over the needed investment in BWT systems. The BWT technologies must prove their effectiveness, robustness and efficiency in practice. Adequate time shall be provided for the ship owners to install the required BWT systems onboard their ships. Financial

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facilitation should be made available for the ship owners to equip their vessels to the required BWT systems. All of these measures need time and haste should be avoided in this respect. The recommendation of a 2-year delay for entry into force of BWM convention can provide this needed time. By resolving the critical issues and providing the needed incentives, IMO and the flag states can encourage the ship owners to implement the IMO-D2 standard voluntarily within the two-year interim period and prepare for the mandatory compliance in the coming years. The meant period will also provide the industry with the time to recuperate in terms of her business cycle. In this case, the change can be worked out with minimum harm to the industry and the environment. In this sense, the industry and the environment will commonly benefit the conduct of Ballast Water Management convention.

Final Words The conduct of Ballast Water Management is a mission that shall be accomplished in the merchant shipping. More than one-third of member-states in IMO have supported the conduct of this convention that serves the biosecurity in a global level. This is a valuable opportunity for shipping to enhance her environmental performance in the global context. Nevertheless, the BWM convention is coming into effect in the hard times of shipping. Merchant shipping is currently in the trough parts of one of her longest business cycles, and entry into force of the convention will increase the level of costs, obscurities, encumbrances and difficulties in the business. Yet, the relevant issues with the convention can be identified and overcome by negotiations, planning, use of technologies, and most importantly development of synergistic and supportive action in the industry level and beyond it. In this sense, the world can act positively in a way that the conduct of BWM convention is seen as a challenge rather than a problem for the shipping industry. This attitude will serve the environment, the merchant shipping and the global economy at the same time.

By: Sarah Zeinalzadeh Vafa

Shipping is considered to be an initial assistant in global trade with its significant role in economic growth. This industry burden the shoulder to carry different goods to various destinations all over the world. Meanwhile, shipping is a relative subscriber regarding marine environment especially when it comes to marine pollution caused by human activities. In line with this, the UN adopted an agency with the focus on the safety and security of shipping as well as the prevention of marine pollution of ships since the 1960s under the official name “International Maritime Organization (IMO)”. Nowadays, the interest of this agency is both to clean up marine environment extensively and adopt green practices. Shipping is high on the agenda and, therefore, IMO’s vision for the industry is to terminate, or cut all the harmful

Implementation of Three Major Acts by IMO Comes to Force

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environmental effects from ships.Specialist members from the Office of Environment in general and IMO’s Marine Environment Protection Committee (MEPC) in particular serve as technical experts in these significant fields: Ballast water management/ hull bio-fouling, Vessel air emissions, Climate change, Ship recycling, Arctic transportation and Ship radiated noise. Meanwhile, the Office of Environment along with the International Organization for Standardization (ISO) has taken some steps to improve technical industry standards and road-maps to further the advances and deployment of technologies to reduce environmental effects of marine transportation operations.This paper is aimed at giving needed information about three major areas which directly affects marine industry and

marine environment. In the same vein, practical and appropriate approaches to achieving economically sound measures to develop environmental protection acts have been taken into account.

Ballast Water ManagementOn the one hand, safe and efficient operation of modern shipping is rooted in Ballast water and is absolutely fundamental due to providing balance and stability to un-laden ships. On the other hand and owing to the transfer of harmful organisms and pathogens in ships’ ballast water tanks, it may pose a serious ecological, economic and health threat to the industry. When all the required items are pleased, the transferred species may outlive to organize a generative population in the host environment.Emersion of mega size ships in

The MARPOL Convention addresses pollution jettisoning from ships by oil

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marine transportation aiming at increasing international trade through their voyages in shorter times cut down the natural barriers to the dispersal of species across the oceans. In contrast, human health impacts can be caused by the transfer and diffusion of pathogens and toxic materials such as adverse algae in ships’ ballast water.IMO has been working continuously to adjust, meet and react toward the obstacles associated with ballast water management reaching its highest point in 2004 with the adoption of the International Convention for the Control and Management of Ships’ Ballast Water and Sediments. This international treaty with the purpose of preventing, minimizing and eliminating the risks to the environment, human health, property and resources resulted from the transfer of adverse aquatic organisms in ships’ ballast water. This act has been come to practice due to the environmental benefits, technological achievability and, global standardization.The BWM Convention has been ratified by 28 countries in July 2011, representing nearly 27% of the world’s merchant shipping capacity. In line with this, the International Chamber of Shipping (ICS) has recently made a public request from IMO to support a proposal to appoint implementation dates of BWM Convention. It is expected that installing such a system may extend from 2022 to 2024.

Vessel air emissionsThe International Convention for the Prevention of Pollution from Ships (MARPOL) is the

Annex ApplicationAnnex I Regulations for the Prevention of Pollution

by Oil (entered into force 2 October 1983)Annex II Regulations for the Control of Pollution by

Noxious Liquid Substances in Bulk (entered into force 2 October 1983)

Annex III Prevention of Pollution by Harmful Substances Carried by Sea in Packaged Form (entered into force 1 July 1992)

Annex IV Prevention of Pollution by Sewage from Ships (entered into force 27 September 2003)

Annex V Prevention of Pollution by Garbage from Ships (entered into force 31 December 1988)

Annex VI Prevention of Air Pollution from Ships (entered into force 19 May 2005)

leading international convention with the purpose of preventing pollution emitted from ships and directly affect marine environment from operational or accidental causes which was adopted on 2 November 1973 at IMO. The MARPOL Convention addresses pollution jettisoning from ships by oil; detrimental liquid substances carried in bulk and damaging substances carried

by sea in packaged form; sewage; garbage. This convention includes regulations with the purpose of applying six approved Annexes to solve and minimize the potential factors affecting marine environment due to the emissions from the ships. In the same vein, special Areas with severe controls on operational discharges are included. These Annexes are given as the following:

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Sets limits on SOx and NOx emissions from the ships ban deliberate emissions of ozone depleting substances. Mandatory measure owing to operational energy measures with the purpose of reduction at harmful emissions came into force as a chapter in 2011.

Ship recyclingIMO adopted the Hong Kong Convention for the Safe and Environmentally Sound Recycling of Ships in 2009. It is a fact that old ships should be transferred to recycling yards to protect marine environment. But a big challenge arises from the subject due to the poor conditions there. In this regard bad conditions in the recycling yards may lead concerns in seaborne trade and affect the economic global growth directly.

Hence, appointing guidelines on the development of the inventory of hazardous materials and ship recycling plan have been approved by the mentioned Convention.

Various reasons lay behind these measures to delay the global implementations in many developing countries. The International Maritime Organization has launched an Integrated Technical Co-operation Programme (ITCP), aiming at assisting countries in enlarging their human and institutional capacities for effective compliance with the Organization’s regulatory framework. Considering the aids provides by the organization would pave the way to be the witness of cleaner waters and coasts, increased tourism and effective seaborne trade.

International Organization for Standardization (ISO) has taken some steps to improve technical industry standards

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By: Behnam IzadiPh.D. Student at the University of Tehran

Targeting and Market Segmentation in Shipping Industry

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Strategy formulation in different organizations takes place in three levels:Corporation, Business and FunctionStrategy formulation in each of these levels performs with different models, such as Rational Model, Strategic Reference point Model, and Natural Model.Perhaps strategy formulation with natural model is the most common and popular method.Marketing is an organizational function similar to the other organizational functions such as human resource management, financial and Information Technology and the like.In Strategy formulation with natural model in each level of the organization whether corporation ,business, or functional level, first of all mission statement, vision and values must be written in that level.The abstract of the mission statement, the vision, and the values will become the to strategic goals.The next step will be internal and external environment study to identify opportunities, threats, strengths and weaknesses.Suppose you want to study the existence of desks and chairs in your office as the external environment, if your aim is to hold a meeting , these desks and chairs will turn to opportunities for you but if your aim is to play football in your office, the desks and chairs are threats for you. So, these are the goals and objectives which are the criteria to identify opportunity and threats in external environment and then there is a need to identify strengths and weaknesses in internal environment.Let’s imagine we would like to

formulate strategies for marketing department with the natural model; then after writing mission statement, vision and values of marketing department. we must study the internal and external environment.For marketing trategy formulation we must study 3Cs:1- Customers2- Competitors3- CompanyIn fact, the study of 3Cs is like the study of internal and external environment and the study of customers and competitors refers to the study of external environment and study of company points out the study of internal environment.There is also a process in marketing, which is called STP, constituted by segmentation (market segmentation), targeting (Identifying target market) and positioning. In STP process also the internal and external environment is analyzed.

SegmentationMarket segmentation performs under different criteria:In B2B context these criteria are:1- Geographical2- Demographic3- Psychological4- BehavioralIn B2C context these criteria are:- Firmographic- Decision making unit attributes - Personal characteristics of DMU membersIn international markets these criteria are:- Geographical- Economical - Legal-political - Cultural So to segment the market in the shipping industry or the other markets one should choose some

by focused targeting strategy, we choose just one segment

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of these criteria and choose the one which is more pragmatic and preferably measurable. For example, personality as a criteria for market segmentation in B2C context, is a psychological attribute and the marked could be segmented the rough this criteria while data collection about personality is complicated, so this is not an appropriate criteria to segment the market.The next point about criteria choosing in market segmentation we should consider is that we have to choose criteria which result in segments with clear differences.

TargetingIn next step, after market segmentation, considering what differences each segment has in comparison to other segments, we choose one or more as the target markets.Then we choose are targeting the targeting strategies are:1- Mass targeting strategy We choose all segments as the target market and we try to offer

Marketing is an organizational function similar to the other organizational functions such as human resource management, financial and Information Technology and the like

similar products or services to all segments.2- Differentiation targeting strategy We select one or more segment, from all and try to customize our marketing mix for each segment .3- Focused targeting strategy By this strategy, we choose just one segment.4- Niching strategyNiching strategy is a such a small section of focused targeting strategy and usually competitors do not offer services and products in these sections.In fact Niching strategy is a targeting strategy.

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WW

W.M

ANA.IR

No.523, Asseman Tower, Shahid Lavasani (Farmanieh) Junction, Pasdaran Ave. Tehran - Iran.P.o.Box: 19395/1311Tel: (+98 21) 23844561Fax: (+98 21) 26100371

Best Media Atmosphere to Reflect Maritime Institutions and Firms' Achievements

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Saeid KazemiSenior Lecturer in Offshore Engineering, Graduate School of Marine Science and Technology, Science and Research Branch of IAU University, Tehran, Iran

Safety Regulatory Framework of Offshore

Structures

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IntroductionMainly, offshore structures are designed and built to support the exploration and production of oil and gas from beneath the sea floor. The offshore structure should experience minimal movement to provide a stable work station for operations such as drilling and production of oil.Offshore structures must be structurally sound so that they can withstand the severity of environmental forces (e.g., wind, current, storm surges, and waves), and they must be designed to avoid polluting or damaging marine life in coastal or offshore waters. Engineers need to be aware of the environmental consequences or effects of their designs and prototype systems, as well as the safety of their operating systems and equipment for humans.There are two general classes of offshore structures: fixed and floating. A structure is considered fixed if it withstands the environmental forces on it without substantial displacement or

API Standards focused on dimensional uniformity of standard equipment to promote the broad availability of safe and interchangeable products

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deformation. If the displacement is termed small enough that it can be ignored in the design analysis of the structure, then the structure is treated as fixed. A floating structure may be of two types: one is rigid and floating but connected to the seafloor by some mechanical means, while the other allows large deformation of its members when subjected to waves, wind and current. The development of the offshore industry commenced with the use of fixed structures. As development accelerated with the discovery of oil and gas in deeper waters, the use of floating structures became commonplace.The various types of fixed and floating offshore structures are shown in the figure below.

Historical BackgroundAmerican Petroleum Institute (API) Standards were the first standards developed and were used as a basis of good design practices worldwide. Initially, API Standards focused on dimensional uniformity of standard equipment to promote the broad availability of safe and interchangeable products. API Standards have increased in

complexity and scope and there are now over four hundred API Standards covering all areas of oil industry operations.During the 1970’s, the occurrence of major industrial accidents led to an increase in safety-related regulations.The Piper Alpha disaster demonstrated that even when a facility is built to good design standards, catastrophic events can still occur. This incident prompted the recognition that exceptional safety performance requires the implementation of a comprehensive safety management system.While the U.S. was an early leader in the development of codes and regulations governing oil and gas development, the

Energy (DME) is the Designated Authority regarding offshore safety regulations.After Deepwater Horizon disaster in the Gulf of Mexico, which was the largest accidental marine oil spill in the world and the largest environmental disaster in U.S. history, and due to the final report on findings of the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling, Minerals Management Service (MMS) with its conflicting missions of promoting resource development, enforcing safety regulations, and maximizing revenues from offshore operations and lack of resources, was divided into three independent entities to better carry out its missions:- Bureau of Ocean Energy Management (BOEM), responsible for managing development of the nation’s offshore resources in an environmentally and economically responsible way. - Bureau of Safety and Environmental Enforcement (BSEE), to enforce safety and environmental regulations.- Office of Natural Resources Revenue (ONRR).Thus, the jurisdiction over offshore safety in the United States is split between the BSEE, the U.S. Coast Guard, the Department of Transportation, and the individual states to the limit of their jurisdiction in offshore waters.

UK has emerged as a leader in developing performance oriented requirements in recent years. In the UK, the Health and Safety Executive (HSE) has jurisdiction over safety regulations for the offshore oil and gas industry. In Norway, the Norwegian Petroleum Directorate (NPD) has jurisdiction over offshore safety regulations. In Australia, the Department of Minerals and

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Different Approval ProceduresThe design of offshore structures is checked and its safety ensured through procedures known as verification, certification, and classification. These procedures are conducted by special agencies that are independent of the organizations that design and operate ocean systems. Many of these agencies are non-profit organizations that have been set up to ensure the safety of human life and property at sea, and some have origins in servicing the insurance industries. Some classification societies are delegated by the government of a country to certify equipment, and it is important to distinguish between their industry standards and those set by the government. Many agencies also operate a for-profit division that is involved in certifying equipment according to specified standards. The verification process is also used to ensure that equipment complies with government standards and classifications, and is often performed by commercial companies. In any application of classification, certification, or verification, it is important to ascertain what sort of agencies are to be involved in the process, as this may vary from project to project. In dealing with the regulatory framework for the offshore industry, two different situations need to be considered. The first is the application of maritime conventions to mobile units that can undertake international voyages in the same way that a ship does and secondly the fixed installations which are subject only to the regulations of the country in whose territorial waters they are located, i.e. the

coastal state.

Offshore Mobile UnitsMost (though not all) maritime authorities require that mobile offshore units comply with an internationally accepted safety standard and, as with ships, the most effective way to comply is to be in class such that the classification society can issue the necessary certificates.The most commonly used safety standard at the present time is the IMO Code of Practice for Mobile Offshore Drilling Units (MODU Code). Prior to the introduction of the MODU Code in 1979, surveys and certification for mobile units were carried out under SOLAS and MARPOL. However, these conventions are not applicable to offshore installations and the certification had no legal standing. In addition, many of the specific requirements within the conventions were impractical to apply to such installations and so many exceptions to individual regulations had to be applied that certificates worded to the effect that “-----this certificate is issued to certify compliance with the requirements of the Safety of Life at Sea Convention 1974------“ had little meaning.

Most classification societies do offer rules and regulations for the classification of fixed offshore installations but very few such installations are classed

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The MODU Code was introduced to resolve these problems. With the exception of the radio safety requirements of SOLAS, the code combines both SOLAS and MARPOL aspects into a single set of requirements. However, the code is not a convention and there are no provisions for signature, ratification and acceptance etc. and, whilst a number of countries have incorporated the code into their own national legislation, many haven’t (the UK being one of them). Many operators of mobile units therefore still prefer to have certificates issued under the provisions of the individual conventions. Because the surveys under MODU Code are identical to those which would, in any case, be carried out under SOLAS and MARPOL (and vice versa), this does not present a problem and there is no additional survey burden for an operator who wishes to cover all the options.

The other convention that is applicable to mobile offshore units is the 1966 International Load Line Convention. This is sufficiently flexible to apply in its entirety and the survey regime under this convention is identical

for mobile units as it is for ships.It can be seen that, in essence, class and statutory surveys on mobile offshore units are very similar to those that are carried out on ships engaged on international voyagesOnce a mobile unit is located on station and is engaged in the exploration or exploitation of oil and gas, it becomes subject to the regulations that apply in the waters of the coastal state. These will be the same as those that apply to fixed installations in the same waters although it is usual for mobile installations to also maintain their class and statutory survey regime whilst on location for the sake of convenience when it comes to moving on.

Fixed Offshore StructuresFixed installations, as their name implies, do not move from location and there is therefore no international dimension to their

operations. They are regulated solely by the legislation that is in force in their coastal state and this can vary from virtually zero in some countries to the sophisticated goal setting and safety case based regulations that are currently in force in UK waters.The structure of much coastal state legislation is such that there is very little to drive an operator into class. Most classification societies do offer rules and regulations for the classification of fixed offshore installations but very few such installations are classed. For example, the first UK regulations for the construction and survey of offshore installations required nominated “Certifying Authorities” to approve plans and carry out surveys during construction, and throughout the life of the installation, to confirm that the approved plans had been adhered to and that

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any deterioration was within acceptable limits. Now it does not take much thought to realise this is also what classification is intended to achieve and, because the majority of the nominated “Certifying Authorities” were the major classification societies anyway, this early UK regime was virtually class by statute. There was little point in an operator also voluntarily classing the installation and just adding to the burden of compliance for no identifiable benefit.

The major operators also considered that class and the early regulations were too prescriptive and did not address all the risks that an individual installation may be subjected to. They argued that the prescribed requirements were either excessive for some installations or were deficient for others. The “PIPER ALPHA” disaster in 1988 added some force to these arguments, as the operators were able to point out that the legislation in force at the time had done nothing to prevent the disaster from happening.

The subsequent enquiry tended to agree and new regulations were put in place in the UK post-1988 which set goals based on reducing risk to, “as low as is reasonably practical” (the A.L.A.R.P. principle) and implementing a safety case regime rather than prescribing specific items of equipment that had to be fitted or detailed criteria that had to be met. A number of countries still retain a prescriptive certification regime but generally now there is a move to risk based goal setting.

In a few of the developing nations’ coastal states where there is no offshore legislation in place, insurance companies, as

The development of the offshore industry commenced with the use of fixed structures

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a condition for their insurance, sometimes specify class. However, this tends to be the exception rather than the rule and depends more on the marketing of class services to insurance companies rather than to installation operators. Installation operators tend to be very successful in arguing that the capital cost of an installation and the loss of revenue that occurs if they have to shut down for unexpected repairs is more of an incentive to proper maintenance and attention to safety than imposed third party regulation.

Regulatory “Enforcers”There are essentially three types of regulatory “enforcers”. Regulations for marine safety come under the jurisdiction of the USCG in U.S. waters, the Maritime and Coastguard Agency (MCA)in the United Kingdom, and the Australian Maritime Safety Authority (AMSA) in Australia and the European Maritime Safety Agency (EMSA) in the European

Union.Regulations related to the petroleum-producing side of the business fall under the jurisdiction of the BSEE (former MMS) in the United States, the Norwegian Petroleum Directorate (NPD) in Norway, and the United Kingdom Health, Safety and Environment (UK HSE) in the United Kingdom. A third type of “enforcer” is the classification societies (e.g., the ABS, DNV-GL, LR, and BV), which overlap to a large degree throughout the offshore sector and serve as rule developers, regulators, independent verifiers, and industry associations. Classification societies also act with delegated authority for the marine safety regulators, and to some degree the petroleum regulators as well. This delegation of authority occurs when both the classification society and the coastal (or flag) state regulator are looking at the same issue(s).Classification societies, while remaining independent, can work on behalf of different types of clients. Some are hired

The major operators also considered that class and the early regulations were too prescriptive

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by owners and/or operators of offshore systems or shipyards to act as an independent third party and conduct design reviews and surveys to address safety issues. Classification societies can also work under the delegated authority of flag states worldwide to survey vessels under that flag’s jurisdiction. Some are delegated the authority by coastal state regulators to enforce marine safety requirements, many of which relate to classification.

ConclusionsOffshore oil and gas production, which involves extracting oil and gas from beneath the sea, is a critical component of the world’s energy supply. It requires the use of increasingly sophisticated technology and ever greater attention to the related environmental impacts. Various kinds of offshore structures are used to support exploratory drilling equipment, and the production plants required to process the hydrocarbons.The continuous innovations to

deal with new demands of industry as well as the inherent potential of risk have led to an industry which has been in the forefront of development of design and analysis methodology.The design of offshore structures is checked and its safety ensured through procedures known as verification, certification, and classification.In dealing with the regulatory framework for the offshore industry, two different situations need to be considered. The first is the application of maritime conventions to mobile units that can undertake international voyages in the same way that a ship does and secondly the fixed installations which are subject only to the regulations of the country in whose territorial waters they are located, i.e. the coastal state.While prescribed rules and regulation dominated the safety regulatory framework of offshore industry for several decades, recent disasters such as “Piper Alpha” in North Sea and

“Deepwater Horizon” in Gulf of Mexico accelerated the use of rational safety approach based on Goal-Setting method with proactive ALARP principle.

ReferencesABS, Guidance Notes on Risk Assessment Applications for the Marine and Offshore Oil and Gas Industries, American Bureau of Shipping, 2000.

IACS, Requirements concerning MOBILE OFFSHORE DRILLING UNITS, International Association of Classification Societies, 2012.

IMO, CODE FOR THE CONSTRUCTION AND EQUIPMENT OF MOBILE OFFSHORE DRILLING UNITS, International Maritime Organisation, 2009.

MOAN T., SAFETY OF OFFSHORE STRUCTURES, Centre for Offshore Research & Engineering National University of Singapore, 2005.

National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling, The Gulf Oil Disaster and the Future of Offshore Drilling, Report to the President, 2011.

RANDALL R.E., Elements of Ocean Engineering, The Society of Naval Architects and Marine Engineers (SNAME), 2010.

By: Fatemeh Moonesan

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JCOPA execution:

A New Setting for Lines’ Venture to and from Iran

The execution of JCPOA has opened a new horizon ahead of Iranian maritime transportation, on the other hand, shipping industry has witnessed various events in the recent months, such as the bankruptcy of the world’s largest shipping container line(Hanjin), and president Trump’s taking office, To delve into these matters further, Payam Darya magazine conducted an interview with Roberto Giannetta, Managing Director of Commercial Management Limited, has more than 25 years of service in the shipping industry providing leadership and secretarial services to shipping agreements, associations and conferences. Having served as director of system development, treasurer for region-wide associations, executive secretary for shipping agreements, and shipping executive representative on industry and governmental organizations (including APEC Shipping Port Network Security, Hong Kong Maritime and Port Board, Article Number Association, and others), Roberto has a vast cross-reference of knowledge in shipping practices across Asia.The transcript of this interview could be accessed in the following

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In your perspective, what impacts has the lifting of sanctions and the execution of JCPOA exerted on the expanding and developing IRA activities in global market?The lifting of sanctions and execution of JCPOA has enabled shipping lines involved in global trades (previously restricted from being involved in Iran market) to expand their scope of coverage for trades to/from Iran. IRA’s objective is to create a platform where shipping lines involved in the trades between Asia and the Gulf region are able to cooperate and compete with each other on a level playing basis in such a way as to meet the demand of services in those markets. By lifting the sanctions, services to Iran were able to be put on the same fair-market playing level as all other markets within IRA’s scope.

What impacts do you speculate the bankruptcy of Hanjin Shipping would have on shipping industry? In the past several years, the shipping industry has been plagued by a scenario where capacity and services exceeded the demand for those services. This has been particularly evident in the Far East services to/from the Gulf. This over-capacity resulted in excessive competition, and depressed rates. Over the long-term of the past few years, this has resulted in most shipping lines around the world facing negative returns on their services. Hanjin’s entering into receivership and subsequent departure from trading has had a net reduction in capacity globally. This capacity and service reduction has, essentially, helped alleviate the excessive over-balance of capacity vs demand. While over-capacity still prevails in most global markets, the Hanjin

rationalized and revised to meet global demand in today’s market. As such, 2017 will continue to be a year of change (ongoing consolidation). Hopefully these changes will result in improved financial conditions for the shipping lines in global markets. We will need to wait-and-see how things look once all the dust from these changes settles.

How do you see the current situation of the world’s shipbuilders?With the adjustment in shipping to bring supply more in line with demand, we will likely see a decline in new orders being placed for new ships in the coming few years. There are plenty of ships worldwide to meet current demand (although, the current size of ships may not be the most efficient and effective in meeting this global demand). I imagine that shipbuilding orders will renew again once all the consolidation (mergers and acquisitions) are completed and the new services are stabilized. Same time, we will need to see some of the older ships being scrapped before new shipbuilding orders are placed.

What are your plans for expanding your collaboration with IRISL?As Secretary for IRA, my role is to assist IRA lines to find an effective and efficient way to cooperate and compete on a free-trade basis with each other – while, at the same time, assist lines to meet demand in the market and retain long-term sustainable revenue levels. As a member of IRA, HDS will continue to be in my radar in trying to provide assistance that will enable HDS to meet demand of its customers, and retain long-term sustainable revenue levels.

departure has helped mitigate some of the excess-capacity.

How have Brexit and Trump’s taking office affected shipping industry? There has not been any immediate effect from Brexit nor Trump’s appointment to office on global shipping. However, the background to both of these events is a push for protectionist policies – countries wanting to pull back from global partnerships and place greater focus on their own domestic production/consumption policies. If these protectionist policies continue to dominate domestic decisions on trade issues (be that in UK, US, or other countries that are leaning toward similar policies), this will have an effect on global trade, as level playing fields in trade will be out of balance – i.e. one country tries to improve their own domestic trade at the expense of other trades. It is too early to see what the ultimate effect will be. We will need to watch and see how other countries respond, what new trade deals come out of the recent events, and how global demand responds to local government protectionist policies.

How do you see shipping industry in 2017?Shipping has faced tremendous financial difficulties in the past several years (reasons explained above). In order to survive in this environment, the shipping industry has undertaken (and will continue to do so in the coming year or two) unprecedented changes and consolidation – mergers, acquisitions, revision of services, etc. These changes in shipping are underway at present and will continue to dominate much of 2017. The net effect of these changes is that services are being

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Hidden Talents in the Field of Sea Would Pave the Way for Foreign Investment:

Iran; Connecting Bridge between Asia and Europe

By: Behrouz Ghahramani

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Having a proud history of three thousand years, Iran has embraced the Persian Gulf or the heart of the earth. It is known as the eighteenth world’s top economy and has such outstanding talents and gifts that nothing can be found like it at any point worldwide. 5800 km of sea border, proximity to three major international waterways, seven coastal provinces with more than a dozen large and small islands and the strategic location with transit capabilities as a communication bridge between Southeast Asia and Europe are the characteristics that could not fit into the vocabulary of many countries.This country is one of the richest lands in terms of variety of climate, history, natural resources, underground resources, marine life, cultural heritage and tourism indices. In fact, each of the provinces of Iran its potential and actual economic capabilities as vast as a country.After the implementation of JCPOA, which is referred to as a window into hope and the creation of a new discourse atmosphere, Iran became famous as the gateway of diplomacy, so much so that since then, on the one hand, we have witnessed the arrival of representatives of various economic sectors to become familiar with our economic capabilities and on the other hand, some Iranian economic delegations have travelled to countries around the world for further consultations and striking deals with foreign companies.It can defiantly be said that we cannot compare the achievements regarding economic and political developments resulted from Post-JCPOA era with any historical

factors for attracting foreign investment to Iran are the low costs and risks, security and political stability of the Islamic Republic of Iran

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juncture of this land.In this respect, the maritime domain has a special place in economic consultations and has the second place in negotiations after oil and gas issues. It should be mentioned that Iran’s marine diplomacy and the resulted successes due to its special role in the international arena not only is the subject of the inner circle but also across the borders. Economists believe that the main factors for attracting foreign investment to Iran are the low costs and risks, security and political stability of the Islamic Republic of Iran and numerous

competitive advantages that lie in the economy of the sea the latter haring doubled the motivation for the presence of the interested parties.In this regard, the Islamic Republic of Iran Customs, free trade zones and special economic zones have set some special exemptions for the import of raw materials, machinery, and spare parts in order to facilitate the work of investors both onshore and offshore. More over, Iran has become one of the members of Multilateral Investment Guarantee Agency (MIGA) and is now able to have MIGA’s

guaranteed coverage for foreign investment. However, Promotion and Protection Act for Foreign Investment and bilateral and multilateral agreements that Iran has signed with various countries have protected the rights of investors against non-commercial risks. Meanwhile, being a member of MIGA would enable the usage of additional guaranteed coverage. It should be noted that the Organization for Investment Economic and Technical Assistance of Iran affiliated to the Ministry of Economy is one of the main supporters of foreign investments and would provide

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marine resources and reserves, diversification in the marine production and services are among the golden advantages for the investors who intend to participate in Iran’s transportation projects and marine industries. In general, investment in the maritime domain has economic efficiency and the there is a high rated return on capital. The diversity in marine projects offers a wider choice to applicants in order to choose the projects with more flexibility and competence.The Post-JCPOA outcomes and indicators of industry and marine transportation in Iran has opened a clear vision for the investors and reaching agreements in the negotiations and conclusion of contracts demonstrates well the excessive growth in this section. It should not be forgotten that the activities related to the maritime domain are quiet wide and the entrance to each of its areas will require different conditions in terms of the amount of capital and the expected period returns on capital. Hence, the expansion of the ports, shipbuilding, multimodal transportation, the establishment of dry port, repair of ships, the construction of the ferries (car and passenger), fisheries products, investment on the ports, bunkering, environmental projects, marine insurance, classification societies, marine tourism, oil and gas exploration in the maritime domain, watersports, LNG, free zones and development of islands are considered as the part of the benefits of marine and coastal areas that along with the transfer of new technology and internal capabilities, the foreign investors could take the necessary

to participate in different marine projects. Such things have already happened in many marine businesses and the executives have spoken many times about the readiness of various economic sectors for the entrance of the foreign. Fortunately, this has been well-received and at present, many representatives of global companies and brands from different countries are working in Iran.Finally, as it was mentioned earlier, the development of the maritime domain is a national and public demand. In this kind of circumstances, the entrance of the investors to Iran is considered as a window of opportunity to interact with the world. In addition, it will certainly play an important role in the development of the national economy and at the same time safeguard the national interest.

has become one of the members of Multilateral Investment Guarantee Agency (MIGA)

all the arrangements for the entry of investors into the country.Thus, adherence to the international obligations and being interested in participating in global markets are among the strategic policies of the Islamic Republic of Iran. In fact, in accordance with the existing rules and guidelines, the executive authorities are required to protect the assets of business partners.

The Golden Advantages of the Maritime Domain for the InvestorsPositive economic growth, young and educated population,

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Qatar’s Big ‘’If ‘’ for convincing Shipowners in the World

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“The Arabic countries have inevitably given up to the word’s new discipline and are unable to react as to what happens around them”The above statement was mentioned by “Mohamed Hassanein Heikal” , the Egyptian reputed researcher and journalist, about the countries with the same language and culture of his own approxi mately three years ago . Of course it was followed by many incidents , such as the change in Saudi Arabian kingdom, undermining of Daesh forces , downturn in the Arabic countries’ economic system as the oil prices slumped , as well as Mohamed Hassanein Heikal’s death itself . Howerer, the above statement has maintained its property , and that’s ‘’ the giving up of Arabic countries. ‘’ Though he had already stated the first statement in the year 2014 during a televised program on “Soft Power and Global New Regulation” later this human’s achievement as Global New Regulation underwent serious changes when Trumpism emerged and Britain was dismembered from the United Nations in a by the time that thinkers around the world are seeking to find a solution for saving Britain from such a deprivation. However, Heikal lectured on the necessity of Arabic Countries’ approach in that televised program while reminding that Arab countries had to move further towards adopting Soft Power so as not to be entangled in Global regulation deep eddy. On contrasty, we’ll have to survey the Arabic countries’ behavior towards one another if we want to take the Egyptian researcher’s main statement as a criteria. As

Qatar’s Big ‘’If ‘’ for convincing Shipowners in the World

There are considerable amounts of products for carrying goods from this country and so it is regarded as a country which attracts oil products for shipping lines

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the most immediate incident which was recently happened , we can mention the event on 5th of June 2017 when a few number of countries such as Saudi Arabia , Emirates , Egypt and Bahrain broke off their diplomatic and trading relations with Qatar and sealed off all their land , sea and air borders to this northern neighbor after Donald Trump had travelled to the Region for establishing an Arabic NATO against Iran under the vain title of the country’s support of Terrorism . If we describe the Global new regulation achievement some Arabic countries gained for establishing security after the cold war ‘’ The actual Security Creation ‘’ , the economies which were intermingled together to prevent from the war and tension in the region were titled as the First Revealing of the world being more secured and safe .Meanwhile it was argued that we would have a more secured and safer region and world by far , as much as the economies interests in different places of the world especially those of the neighboring countries, intermix more together. But if we assess the behavior of Arabic countries towards Qatar in an unsecured region like Middle East with the meaning of globalization, we should assert that , the behavior of this country and it’s partners in confining Qatar bears the same concept of ‘Giving up’ which hasit’s manger on the power, Heikal had talked about. In other words Giving up to such an America has not only gone through different structures in the region, but also has caused all diplomatic and trading relations to become astonishing and undergo unexpected changes. Therefore

there is a critical situation in Qatar transportation services at present the has caused the trend of investment and deposits in Qatari banks to slide downward

, we can focus on the recent crisis as well as the economic consequences it was bearing in order to find out what is actually going on about such countries.

What is the economic situation of Qatar ?Having a population of 2400,000 people, Qatar is situated on the South East of Persian Gulf and is bounded only to Saudi Arabian land border. So, this peninsular country will have to use Saudi Arabian air and sea lines as well, in addition to the land border it has with it in order to communicate with overseas countries. As some unexpected tensions have recently cropped up in the relations between this country with four other Arabian countries in the region , there is a critical situation in Qatar transportation services at present the has caused the trend of investment and deposits in Qatari banks to slide downward . This is while some analysts believe that Trump’s support of Saudi Arabia’s coalition against Qatar has caused the economic system to be shocked and the drop in shares value of Qatari companies has brought about a good opportunity for long-term investment in this country due to the conditions for making investment which can be provided by undermining the shares having been attracted. Also if the attraction of investment in Qatar combined with returning of Qatari companies’ capitals, conditions would become quite different , since more than 230 Qatari investors are presently involved in the stocks only in the city of Dubai. According to the statistics released, Qatari companies have made investments equal to over

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two million and eight hundred thousand Dirhams only in this sector in Emirate’s stock markets and since their trading and political

relations have been broken off, they have to exit from Emirates and return to Qatar in order to preserve their own financial resources . Therefore , economic analysts and experts believe that by considering the economic statistics of Qatar , this emirate country has always had a positive balance sheet as the greatest exporter of gas in the world , and can keep such conditions if no disturbance is made in the trend of exporting gas from the country. So it can be expected that Qatar would defend the credit of it’s national currency for years and prevent it’s slump, in the case which political crisis continues in the relations it has

with neighboring countries with respect to it’s present balance sheet. On the other hand , it should be noted that there has been an increase in Qatar’s international reserves during the recent years , with such a proportion that they could enhance and nudge 34 billion dollars during the month of April of the current year. As we may know , Qatar is considered as one of the richest countries in the world with a total wealth equals to 335 billion dollars. Considering the above mentioned , along with the huge oil and gas reserves the country has, taking it’s statistics of gas exports to other great countries such as South Korea , Japan and Britain, it can be assumed that they wouldn’t have any quick and practical effect on Qatar’s economic system. Notwithstanding , there’s a main ‘’ If’’ , and that is marine bounding which is in the way of

this country.

Will Ship Carriers Ever Return to Qatar?Due to the climate situation of Qatar, this country has to import food stuff through the borders in order to provide what it needs , and since the land borders have all been closed to this country by Saudi Arabia, the only possible way for the country would be by air and marine borders. But the country which is mainly dependent on oil and gas will need to export it’s own products that are mainly oil and gas by the sea routes in order to preserve it’s position and be able to provide it’s needs , This is whereas, all marine borders have already been closed to Qatar. Although Qatar can improve it’s present situation through the Iranian and Omani inland waters, that ‘ If ‘’ previously mentioned gets a meaning at this point, if we know that the great shipping companies in the world as well as international forwarding companies have all fallen into hesitation regarding further cooperation with this country ever since it was sanctioned by Saudi Arabia. Since Saudi Arabia has long been known as the greatest oil exporter in the region as well as the most major producer and exporter of petrochemicals in the Middle East ,the two Saudi oil companies cayled “Aramco “ and “ Sabik “ use International Shipping Lines , in addition to ‘’Albahri ‘’ shipping line which belongs to Saudi Arabia itself , to transfer their oil products . There are considerable amounts of products for carrying goods from this country and so it is regarded as a country which

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attracts oil products for shipping lines. That’s why, many great shipping lines such as MAERSK, OOCL , Hong Kong and Ogre abandoned offering more services to Qatar immediately after it was sanctioned and confined by Saudi Arabia . CMA CGM that is a great French shipping line with regular services from East Asia to Persian Gulf has also fallen into doubts recently . Therefore , Qatar should be able to provide necessary conditions and guaranties for these companies in order to survive this critical situation . Of course Japan which is the main importer of LNG shipments from Qatar had previously announced that the sanctions would not influence it’s economic relations with that country and it is still to continue importing LNG shipments with the same previous regular quantity and amounts . This country turned to be a good

supporter for such a small country like Qatar during that period . But it should be noted that port of Fujairah and Jebel Ali , as the bunkering hub in the region and port hub in the Middle East, respectively had declined from admitting Qatari- owned vessels or those vessels sailing from Qatar as the origin port or being destined for that country This can cause disturbances for great shipping lines when vessely are about to call Qatari ports or depart from them . Also following the tension, there were momentary limitations and bounds without any presumption that caused cargoes which had been loaded and destined for Qatar or were in the process of being loaded to be crippled. These bounds would make a disturbance in the business trend of shipping companies and we should expect to be observing disputes between ship- owners

and leasing companies in the near future because both groups will face hard challenges over the surcharges caused as a result of cargo delay . Therefore , we can construe choosing the port of Sahar in Oman within less than five days following the tension in order to remove this problem, as a necessary strategic issue to be dealt between ship owners and forwarding companies this made Saudi Arabia gradually to retreat from it’s initial banning announcement and devote the passing ban only to those vessels bearing Qatari flag and ownership. Of course, besides the problems which marine transportation experienced due to the sanctions imposed on the country of Qatar , we can also expect an opportunity to be given so that conditions for bulk transportation sector as well as bulk carriers to improve

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and experience development , as the crisis still continues while Qatar is feeling high demand to provide food stuff from beyond it’s borders. It’s reason lies on the increase in Qatar’s demand for exporting LNG reserves on one hand and hard efforts Qatar’s government is making to remove people’s tension and worries about deficiency of food stuff on the other hand ,which have driven the country towards increasing strategic oil reserves more than ever before .So they can make even a bit of peace and calmness for the people. If Qatar can enjoy the situation of Iran as a country which can both supply fuels for it’s vessels and offer the services of it’s ports to this country for

transshipping cargo and feeder transportation would be able to go through this hard period successfully. Considering the common interests both Iran and Qatar have in the project of South Pars region made the grounds for their mutual cooperating and developing agreement in the year 2014. But as previously mentioned providing guaranties for ship owners in the international arenas would be the only way for Qatar to survive the present critical situation and prevent existing impediments in the way of it’s business goals so that there wouldn’t be any disturbances in the trend of exports in this peninsular country which have recently turned into an island .

Qatar should be able to provide necessary conditions and guaranties for these companies in order to survive this critical situation

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JCPOA:

Milestone for Expanding Iran-Germany Collaboration

The execution of JCPOA has exerted a remarkable impact on the mutual ties between Iran and Germany, in order to collect more on this issue, Payam Darya magazine has conducted an interview with Anne Jacobs-Schleithoff, who has headed the Division for the Maritime Industry and the Office of the Federal Government Coordinator of the Maritime Industry in the Directorate-General for Industrial Policy of the Federal Ministry for Economic Affairs and Energy since 2016, she also worked in the Directorate-General for External Economic Policy of the Federal Ministry for Economic Affairs and Energy, and was responsible for trade and economic policy relations with the NAFTA countries, and particularly the free trade agreements between the EU and the U.S. (TTIP), Canada (CETA) and Mexico. You will find the transcript of this interview in the upcoming lines.

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In your perspective, what impact has the lifting of sanctions and the execution of JCPOA exerted on the expanding and developing ties between Iran and Germany?The Joint Comprehensive Plan of Action (JCPOA) is an important milestone for our collaboration. The restoration of the economic and financial relations between Germany and Iran is a major step towards a stable and reliable partnership with Iran, also from a global perspective. We are decided to continue implementing the JCPOA. We have great interest in pursuing a stabilizing process which has been supported by the P5+1/E3+3-countries all along the way. From my point of view, the German approach is focused on working together with our European and American partners on the political as well as expert level to implement sanctions relief in an effective way.Between our two countries, this new chapter builds on the good traditions in Iranian-German economic relations which have been established since the 19th century. After lifting the vast majority of international sanctions, it is important to encourage banks taking their role in areas of correspondent banking and project financing. It is necessary especially for the Iranian people to feel the benefit of being connected to the global financial world again and build up trust to its western partners. Now the common goal is to boost the current trade volume between our countries in quantitative and in qualitative terms. This will hopefully also entail progress in other areas where development is still cumbersome in international relationships. We are now pursuing a structured cooperation with Iranian institutions to further enhance the cooperation between our industries and companies. To this effect, a

Machinery and Marine technology trade fair. It is in our mutual interest to start with a pilot project as soon as possible to show our commitment to fill our common statement of intent with action. Therefore we should work on both sides in order to determine such a project and prepare the necessary steps to start it.

What are your current plans for expanding your collaboration with IRISL and its subsidiaries?We conducted a maritime business trip to Iran in May 2017 in order to establish and re-establish contacts within the maritime communities of both countries. We recognized that IRISL is a key player in the shipping industry of Iran; we had fruitful discussions so that I am convinced that there will be many areas of collaboration between IRISL and the German maritime suppliers. The German maritime technology industry is heterogeneous in many respects and covers diversified markets such as shipbuilding, ship repair, port and shipyard infrastructure, maritime technologies, naval shipbuilding, boatbuilding, offshore oil & gas, offshore wind, underwater etc. German marine suppliers deliver materials, systems, equipment, and act as service providers in engineering and consulting or are integrated as subcontractors in pre-product manufacturing and assembly. German companies are very much looking forward to expanding the collaboration with IRISL in all of the above mentioned areas.

In your recent trip to Iran, you visited Bandar Abbas, how do you evaluate the potentials of Iranian ports?I think the port of Bandar Abbas is very important for Iran since it is the Iranian gateway to the world and an

After lifting the vast majority of international sanctions, it is important to encourage banks taking their role in areas of correspondent banking and project financing

number of agreements and MoUs – on governmental as well as on business level – was concluded at the occasion of the Fifth German-Iranian Joint Economic Commission in October 2016. Both sides attach great significance to foreign trade and investment promotion through free and unhindered market access. The Agreement on Reciprocal Promotion and Protection of Investment between Iran and Germany which entered into force in 2005 is an important element of future Iranian-German investment relations. I think we are well on track to expand and to develop the ties between Iran and Germany. The German business community is most interested in market and sectoral information about Iran. Regarding the maritime community, we are very much looking forward to welcoming our Iranian friends and partners in September 2018 in Hamburg at the “SMM Hamburg”, the leading international Shipbuilding,

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important hub for transit cargo for central western Asia. I understood that Iran wants to expand its existing port infrastructures further in a significant manner to cater for the future growing trade. It was good to learn that the port hinterland infrastructure development and connections by railway were also included in the plan. For all of your plans, German companies are reliable and competent partners which would be happy to support in their respective fields in planning and equipment for shipyards, ports, etc. and design, building assistance and equipment for ancillary ships like tugs, dredgers, SAR vessels, etc.Our talks with our counterparts in Bandar Abbas and the maritime business community in general, their enterprises and authorities - like PMO, NITC, IRISL, ISOICO and the Authority of the Special Economic Zone Anzali - showed us the common interests we share in building up maritime businesses, ports, infrastructure and shipbuilding. Now it is urgent to make up the technological leeway. German maritime business partners are very interested and willing to cooperate with the Iranian maritime counterparts. For businesses to be legally possible, it is of crucial importance that persons and entities which remain designated under EU/international sanctions are not involved in the operation of Iranian maritime companies as well as the operation of Iranian ports.

Which role does your ministry play in expanding collaboration with Iran?Our economies differ in the engagement of the government in the business sector. The German Government sets out -in line with the international agreements

and treaties -the framework for trade. But at the end of the day, the privately owned German companies make their own business decisions independently. The German Government is encouraging German companies to renew the old ties between Germany and Iran and to deepen the collaboration. My Ministry supports for example German companies in facing the challenge of entering and securing business in foreign markets and supports participation of companies in trade fairs and exhibitions worldwide. A good example was the Iran Oil Show that took place at the beginning of May in Tehran and was an

least due to the close exchange of knowledge in the higher education programs, for example through student exchanges as well as manager exchange programs and technological partnerships with German companies like shipyards or design companies. When it comes to private foreign direct investment in Iran, all foreign companies need to be sure about the political stability and reliability. In fact, this is the key factor for any economic decision by the private companies. That also applies to our German companies.

important get together for offshore industry suppliers and shipyards and for other international oil and gas companies and operators. My Ministry is sponsoring the German national pavilion at this important trade event.

In which ways do you like to share technology and knowledge with Iran?Iran wants to modernize and Germany can offer the most advanced technologies and services. This can be a win-win situation for both countries, not

The German Government is encouraging German companies to renew the old ties between Germany and Iran and to deepen the collaboration

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Rouhani’sAccompolishments

Iran

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By: Vahid Basereh best possible way. Dr. Rouhani presented himself as a middleman at the time , with his pivotal – electoral slogan as ‘’ removing sanctions and restoring Iran to a global democratic society as well as solving the economic problems ‘’. Before that, during the presidency of Mahmood Ahmadinejad, the Iranian economic system sustained a

In the aftermath of years of sanctions and foreign pressures, the Iranian nation eventually made a historical decision in the year 2013 and elected Dr. Hassan Rouhani , as the president of the Islamic Republic of Iran during the 11th term of presidential elections in order to modify the political and economic strategy in their own country in the

How Iran Could Step into An Economic Leap?!

Positive Change

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great blow due to the sanctions imposed, and it was feared the people would soon encounter a major economic crisis . However, the cards turned once Rouhani was elected, not too soon of course, but since the New Iranian character gained popularity in the world , Iran could keep away the imminent threat of nuclear sanctions through close-fought and compacted negotiations with Great Powers in the world which savored of dramatic relations on some occasions , and rejuvenate the economy which had been undermined by sanctions , once again . concurrent with that , some extraordinary and compacted plans were put on the agenda for containing inflation as well as regulating the already fluctuating currency market in the country , so that the inflation with an index of nearly %40 , which had been left unattended from the previous presidential term to be slumped to below %15 within a short period of time and contained. The economic growth which started to decline to about minus 6.7 per cent mark in the year Rouhani first took the office as the president of Iran. Therefore , considerable efforts were made to prevent the economic growth from falling further, so that the growth index would close to about zero or even 1 per cent mark within a period of one year. According to the statistics Center and Central Bank of Iran , at present while the first presidential term of Rouhani is over , this index has enhanced and nudged to over 7 per cent mark. Iran’s Oil production as the main source of income for the country which had slumped to below one million barrels per day in the year 2013 could rise again and reach 3,200,000 barrels of oil per day

only within a period of shorter than 4 years. The increasing trend of oil production was kept gradually while negotiations on nuclear affairs were underway with the minimum facilities in the country at the time , but once the sanctions were lifted , it gained momentum . The present statistics indicate only a small part of modifications having been made in the Iranian economic system during the past 4 years. Iran as a great country in the heart of Middle East, with a population of 80 million young and educated people , in which four million students are presently studying at the country’s universities has enough potential to be turned into an industrial and developed country in near future. These following figures are worthy of being noted : - 5800 kilometers of accessible

shores which enjoy possibilities for commercial and tourism purposes

- Having 94 billion tons of mineral potential and actual reserves (non-oil )which have turned Iran into the fifteenth mineral power in the world.

- 34 trillion cubic meters of

eriod of time and contained. The economic growth which started to decline to about minus 6.7 per cent mark in the year Rouhani first took the office as the president of Iran

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fixed gas reserves- 700 billion barrels of fixed

reserves of oil with the possibility of extracting 157 billion barrels

- Producing 118 million tons of different agricultural crops

- Transportation of more than 604 million tons of commodities during a year in the country, based on the statistics of the year 2014

- Manufacturing of 1 million and three hundred thousand sets of automobile in a year .

These include only part of the potentials of a country being located in the most crisis-ridden regions in the world. President Rouhani’s government has managed to decrease the rate of inflation to below 10 per cent so far. It has also been able to increase oil exports from below one million barrels per day in the year 2013 to over 2 and half a million barrels, and in the aviation sector only , to strike a deal buy more than 200 aircraft from the most reputable aircraft manufacturing companies in the world using international finance. During the period , President Rouhani’s government which is the eleventh one since the beginning of Islamic revolution could enhance the index of business facility in the country from rank 152 in the year 2013 to 120 in 2016 during the last days it was in office before the new elections. concurrent with this period , Iran’s credit – commercial risk has been promoted from rank 82 to 54 and the entrepreneurial index has been enhanced from 100 to 85 in the world.IMF officially reported that Iran’s Gross Domestic Product shall be increased to over 17 billion dollars during the current year. In

the year 2015 , this international organization had evaluated Iran’s GDP income to be 1381 billion dollars , considering the purchasing power of people and proclaimed this country as being the eighteenth major economic power in the world .When the JCPOA was being formally signed by the officials , Followed by the removal of Iran’s sanctions, the Economist called Iran’s economy as one of the most progressive economies in the region , affirming that it would have enough potential to achieve fast growth and development . But now in May 2017, %75 of the Iranian people are going to the polls in another elections to vote for president Rouhani’s government to remain in office

for another four-year term. This is a clear message to all the countries in the region as well as the whole world. The message stresses on continuing the modification and trying to play an effective role which would merit a historical nation in the present world. The Iranians have actually decided to be a main part of the world and have put such a task on president Rouhani’s shoulder and his administration. The government which has proved that it can be efficient in spite of all deficiencies and limitations. The world also should hear the voice of a nation that has opted for economic development and establishing a good and constructive relationship with those beyond their country. Iran

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is presently laying foundation for attracting billions of dollars of foreign investments. The tourism sector in this country is about to be reconstructed and modified in the process of a developing plan , both in transportation and welfare sectors. If such projects and plans are fulfilled , Iran will potentially have the capability to be the host of more than 30 million tourists a year. There are historical , cultural and natural sights and monuments in every corner of this country which are exquisite and so attractive for all the people around the world. Referring to the industrial sector , we observe that this country has made determined efforts to be turned into an industrial country from the mid-1920s onwards. Iran has the potential of producing in many of diverse industrial sectors. Many of the Iranian industrial infrastructures are ready for the foreign partnership these days. The Iranian car manufacturing companies have recently signed gainful agreements for developing their activities with the most reputable international companies. As previously mentioned , the transportation industry is going to be renovated in the aviation sector by the plan for purchasing more than 200 aircraft.Concurrent with that , the long-standing Iranian National shipping line has received many offers from great international manufacturers for the re . Railway facilities also shall be renovated and developed at high scale thanks to the company’s consolidated plans as well as it’s partnership in foreign sector. The politics , however , still continue to pound on old deafening drums . Motivated by some old business

partners ,US officials turned a blind eye to the golden opportunities in the Iranian markets , and on some occasions dissuaded the others from making the most of the present situation as well under false pretexts . During the first press conference after the elections of May 2017, president Rouhani pointed out this key-note issue and stated that US officials lack any proper realization of the region as well as Iran, while advising them to be cautious so as not to make repetitive mistakes by the motivation of some spiteful partners . He further added

President Rouhani’s government has managed to decrease the rate of inflation to below 10 per cent so far

that its time for the whole world to remove their blinders and seek the reality of Iran and be sure that if they do so, all their previous false and inconsiderate judgments about this country would vanish just as a horrible nightmare they may have in the process of a long sleep.

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I n t e r v i e w

Eliminating the sanctions and creating the right framework for economic cooperation resulted in the fact that once again, cooperation and participation in the Iranian economy emerges and the sanctions to be replaced with understanding and cooperation.On this basis, and with the rise of big business companies, throughout the globe, according to their priorities, they chose diverse sectors of the Iranian economy for investment and cooperation. But what matters to the foreign party is the capability to guarantee the capital as well as variety in kind of cooperation.This idea made Social Security Investment Co. (SSIC) the largest economic complex in the country which, by creating diverse holdings, includes a vast coverage of economic activity in the country attracted more and more attention of investors and owners of global industries. Based on this, we arranged a dialogue with Dr. Seyed Reza Norouzzadeh, Managing Director of SSIC to ask about the cooperation the company had in the post sanctions era. You are to read the transcript of this interview conducted by PD in the following:Dr. Norouzzadeh initially argued that SSIC is a huge economic complex, which actually has assets of about 70 trillion tomans and said: 10% of the stock market in Iran belongs to SSIC of which, the 6% of Iranian stock exchange is exclusively owned by the Oil and Gas and Petrochemical Supply Holdings (Tappico). Therefore, it can be seen that from a total of 9 Holdings of SSIC each contains between 30% and 40% of total country products.Managing Director of SSIC continued: Thus, SSIC is a massive economic complex in the country and its capital indirectly belongs to the labor community and the salary and insurance paid by the workers. SSIC’s facilities are created as the investment arm of the organization.He stated that the Social Security Organization of the country provided more than 72000 billion tomans annually and added that: The Social Security Organization has the legal capacity that the legislator has set for him. Also, it should be responsible for paying the salaries of the pensioners of the labor community through the interests it makes. Therefore, it is observed that the Social Security Organization faces a very serious responsibility and fortunately,

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during the eleventh government, they managed to provide resources to the government, with the pure and efficient management, without relying solely on the government so as to be responsive to the labors’ community. Accordingly, it can be seen that if we compare the amount paid by the organization with the annual budget of the country, which is more than 9,000 billion tomans, we will come to the conclusion that the social security package is doing something decent.Dr. Norouzzadeh continued: Accordingly, SSIC is a collection of social security assets whose purpose is to invest in resources. Of course, it should be noted that, unfortunately, during the period we passed, especially in the ninth and tenth governments, due to the sanctions and problems

were halted in 8 years by the ninth and tenth governments. In this way, the development of companies and production units has been hampered but luckily, with the outcome of today, European and different countries has stepped into Iran and they visited economic collections. Furthermore, we are interacting with these companies and have facilitated the problems we’ve had before the deal. So, I believe this is a great opportunity for us to be able to cope with recent investments or to complete the ongoing investments. He continued: On this basis, we see that the volume and type of our interactions are developing. He continued: I can, for example, refer to the recent trip with the Minister of Labor and Social Affairs to Croatia, in which, with the cooperation of the distinguished ambassador

that were created for Iran, huge economic enterprises, including SSIC, suffered great losses. Fortunately, in the eleventh state, conditions are moving towards improvement.Managing Director of SSIC continued to explain the improvement in the post-sanctions era and stated that: Our relationship with the world has improved, and this improvement in the relationship with the world has led to the development of the activities of large investment and economic companies, especially in knowledge-based units and units requiring modern technologies.Referring to the fluctuating conditions of the boycott in economic relations, Dr. Norouzzadeh said: By creating a heavy atmosphere, Iranophobia and the sanctions virtually ceased, and economic revenues 100100

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of our country, Mr. Sadeq, there were important achievements.Dr. Norouz Zadeh stated that the development of economic relations with the world can be shown in the example of Croatia and added that: I used the opportunity to take part in the trip and met with Inna, an oil company. They worked in Iran and Egypt, and some African countries in oil fields. Due to the sanctions, their relationship with Iran was cut off because of the war with Syria but they are still working in Jordan and Egypt. Of course it may be said that the company is not among the the largest oil ones in the world and they are very interested in communicating with us; so, we signed a memorandum of understanding with one of them, SSIC, representing Tappico and the other side of the company, Ina, from Croatia. We hope that we can apply this collaborative effort in the field of exploration and extraction. Managing director of SSIC, one of the accomplishments of the achievement, has changed the paradigm of economic and trade cooperation in other countries in relation to Iran, and said: SSIC’s CEO remarked one of the accomplishments as changing the paradigm of cooperation now and stated that: any country we are visiting, or that foreign delegations entering the country are willing to invest. This is an important achievement, of course, in the type of investment. For example, China, which previously only cooperated with us in the form of EPCF, is now saying we are ready to invest together.Dr. Norouzzadeh continued: having a company that provides resources is an achievement. But if

we partner with them and connect to the global markets through this, the bigger achievement is gained because they would force to constantly update their existing plants in terms of technical knowledge, and so the factory will not be back in the days after science and technology.The Managing Director of SSIC goes on to say two examples of the time before the complete abolition of sanctions. The event was the starting point for moving the train of economy of the country and said: Before I became CEO of SSIC, I was the managing director of the Industrial Development and Renovation Organization (IDRO) and there we carried out two major projects of phases 17 and 18. These projects had a 92 percent improvement in theory, and the money was taken from the employer but in practice, we had 60% of physical progress. Because, for example, some supplies and items have been purchased from Siemens but due to the sanctions, the company rejected the delivery. Accordingly, it is possible to see either the required items are not entered into the site, or with a lot of intermediaries and huge expense. He continued: As we succeeded, we were able to quickly go ahead with the sanctions and enter the requirements. Therefore, we were able to enter the two phases, thus meeting the country’s needs, especially during the cold season. And the result was revealed that in a gas dispute with Turkmenistan, the country was able to get out of it without a problem.Dr. Norouzzadeh described the second major project as the Persian Gulf star, adding: The Persian Gulf Started for about 11 years in the 55 percent

With the use of up-to-date technology and the cooperation of foreign companies, Persian gulf star will enter the circuit until the first six months of 2019

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process but by connecting with foreign companies we were able to co-operate with the licensed companies again. For example, UOP Company in the US or companies such as Siemens were not responsible at all. But during this time the situation changed, and today it is here without the need for an intermediary with a phone call from the representative of his representative. It even brought his catalysts and monitors the catalyst. Siemens compressors could also be mentioned that it was not possible to exploit the refinery without entering them. But today, since optimization of relationships is observed, the conditions have come to the normal state. Managing Director of SSIC added that today the Gulf Star has produced 12 million liters of gas in the first phase and said: With the use of up-to-date technology and the cooperation of foreign companies, it will enter the circuit until the first six months of 2019, the second and third phases which means producing 36 million liters of gasoline in the country. Accordingly, we believe that the movement of the economy train may be slow moving from the cancellation of sanctions, but we cannot expect to overtake at a high pace overnight.Dr. Norouzzadeh referred the recent contract with the National Oil Company and explained that: Today, if we want to look at what was said about phase 17 and 18 which took 11 years to be accomplished, come to the term that these two phases had to be fulfilled in six years and this means the interest for Iran and the people has been lost during this time while the southern partner was picking up and we were

losing our property. The Supreme Total Company completed this great Project with $4.8 Billion instead of $6.7 Billion through taking advantage of cutting-edge technology.He continued: If we look at different phases of the South Pars, It’s been seen that all of the products come from former technology, but today we need to own up-to-date technology and through this partnership with hot shot companies, we can achieve this.Managing Director of SSIC added that the translation of the resilience economy considered by the Supreme Leader also implies the development of economic relations and stated that: We must take advantage of the opportunity and move forward with the independence and the relationship with the world towards a resilient economy, with introspective approach and an eye on outside the country. He continued: Introspective approach and having an eye on outside the country means that if you buy a technology or build a factory, you should use your domestic capacity but note who your competitors are and this means that you must be able to compete in the global markets to deliver your products at a global and competitive level.Dr. Norouzzadeh in response to the question of building a cooperative company in the field of petrochemicals with Total replied that: SSIC talks not only with Total, but also with Shell, BP or Saif from Germany either through the original company or through their representatives and we believe that where there is the possibility of co-operation, we are ready to jointly invest and as

Iranophobia and the sanctions virtually ceased, and economic revenues were halted in 8 years by the ninth and tenth governments

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we said, we are at the beginning and would move forward.He continued: At the moment, in the oil and gas supply holding (Tappico) we are managing the two important projects, the Technologists 2, which converted methanol to polypropylene and the Siraf project, which converted condensate to the product; therefore, in order to create more optimal added value and create a production chain, we are negotiating with foreign parties to finalize these two projects.Managing Director of SSIC said that he agreed with the Korean and Japanese sides to advance the Siraf project and stated that: For the finalization and creation of this Megaproject, the $ 3 billion financing will be provided by a foreign party (Japanese and Korean), which is itself the result of intensive negotiations with our colleagues in Tappico.

Dr. Norouzzadeh added the creation of a platform for dialogue and resolution of problems with foreign parties as another blessing and constructive engagement with the world and explained that: At the time of sanctions, Iranian shipbuilding funds were blocked by Hyundai And the Korean side was not willing to deliver the ship or pay the money by saying that we were losing interest through steel cutting. But by creating a suitable platform for negotiation, not only that money was accepted as a prepayment but also the Korean company provided 800 million euros as finance that is the result of good IRISL managers and interaction with the global community.He continued: It was also stipulated on the margin of this contract that Iranian engineers would be trained by the Iranian engineers to create a suitable

platform for the construction of Mega ships in order to have an integrated facility for the construction and repair of mega-seismic ships at ISOICO Company in the near future.Dr. Norouzzadeh pointed out in the end with Iran’s pioneering dialogue in the world with the project of Dialogue on Civilizations and stated that: Today is an indescribable reality that, through our active diplomacy, we were able to achieve a common understanding with the six world powers. As a result, we gained both the power and the right to prove ourselves, so we believe that JCPOA is the opportunity that should be looked at as a window so that everyone can benefit from it.

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Post-JCPOA Era:

IRISL Receives 10-Figure Insurance Coverage

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The managing director of Islamic Republic of Iran Shipping Line (IRISL) stated that Iranian government has always been supportive of IRISL activities, and this trend is going to steadily continue in the future.The director and head of the board at IRISL, Dr. Mohammad Saeedi, expressed that at the era of the sanctions, IRISL was faced with comprehensive and multi-faceted restrictions. The designers of these brutal sanctions, Dr. Saeedi added, had designed them in a meticulously accurate manner, seeing that they had practically targeted the major export and import arm of the country. Their analysis had it that provided IRISL, as Iran’s national fleet, is paralyzed, the country’s import and export will be disrupted, this will bring about economic failure, and people’s dissatisfaction will ensue. This could also prevent

Iran from reaching the financial resources that it would receive from exporting oil, petroleum products, petrochemical material and other goods. From the sanction enforcers’ perspective, the sanctions would have gradually worn Iran out, and as well, confined Iran’s imports, which resulted in a failure in country’s national economy.In this era, Dr. Saeedi added, IRISL encountered a large number and a wide variety of confinements – namely individuals and personnel, subsidiary companies and its main holding – but despite all these restrictions, we collectively endeavored to prevent imposers’ scenario from playing out. Having set neutralizing this ploy as our top agenda, we managed to earn noticeable achievements.Dr. Saeedi deemed insurance limitations as one of the major and critical confinements that

was extended to IRISL fleet, and asserted that all international insurance corporations had cut their ties with IRISL at the time. Indeed, unless IRISL managed to provide international insurance for its fleet, it could not have travelled to the world’s main and paramount ports. On the top of that, Dr. Saeedi continued, the classification societies, which issue certificates for ships, had also cut their ties with IRISL and this was yet another obstacle ahead of IRISL to send its fleet to world’s prominent ports.One of the implications of JCPOA for IRISL was enabling us to resolve the insurance issues. In our first post-JCPOA step, we managed to obtain a 75-million dollars insurance coverage from some world-renowned insurance firms, and in our second step, we increased this figure to 450 million dollars. An insurance

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coverage of this figure was a new record for the past 10 years. A good piece of news that I would like to break to you now is that last month, we managed to promote our reinsurance coverage to one billion dollars. This is certainly a stunning step for IRISL and for Iran. In line with these achievements, IRISL was admitted as a member to the board of directors at London Insurance Club (P&I) after 10 years, and this was yet another honor accomplished after JCPOA’s execution. IRISL is currently in contract with most of the world’s credible classification societies , Dr. Saeedi continued, and IRISL transboundary fleet are all classified within international classes. In a nutshell, classification confinements have also been lifted

and IRISL is currently acting with no restrictions.

Restoration via Retrieval of ContractsOf other merits that JCPOA brought about for IRISL, Dr. Saeedi added, I would like to refer to the retrieval of the contracts that had been suspended at the sanctions era. Some of these contracts had been referred to international courts and some, as I stated earlier, had simply been suspended. After JCPOA was executed, nevertheless, we managed to retrieve each and every one of these contracts, one very significant of which was the one for building 17 ships singed in 2008.According to Dr. Saeedi, IRISL finally sat down to negotiate with

Hyundai Corporation, which lasted over one and a quarter years. Of course, Hyundai was not willing to negotiation in the first place, believing that it had suffered major blows and losses from that contract. Despite this, the negotiations started and the Korean company entered the discussions with this claim of huge losses. Finally, after 15 months of breath-taking and protracted talks, the reached conclusion was to change the 100-percent IRISL-funded 2008 contract to 20-percent IRISL-funded and 80-percent Korean-funded contract. Besides, the initial 158 million dollars that Iran had paid Hyundai in 2008 was accepted as the 20 % funding of the IRISL. This was the first funding Iran managed to absorb in the past 10 years. Based on

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this retrieved 670-million-Euro contract, Hyundai was committed to deliver 10 ships to Iran. The original contract was signed for 17 ships, but this number was reduced to 10 in the new version. The main privilege of this contract for Iran is that it will enable IRISL for the first time to possess container ships that are capable of transporting 14,500 TEU containers.Believing that Iranian ships’ travelling under Iranian flag in international waters was a great honor, Dr. Saeedi stressed that at the sanctions era, the strong and sever sanctions forced us to hide Iran’s flag, and raise the flags of other countries on IRISL ships. Nonetheless, after the execution of JCPOA, we endeavored pertinaciously to raise Iran’s flags on Iranian ships again, and I dare

contracts were executed. Better put, IRISL commenced its move 4 months prior to the execution of JCPOA, and on the day JCPOA was launched, all IRISL contracts were launched, as well.Dr. Saeedi counted attempts for the retrieval of IRISL brand as another measures taken by his company after the execution of JCPOA, and stated that the new open conditions have created a new opportunity for IRISL to do so. It is promising that in the past 18 months, Dr. Saeedi continued, we have reached remarkable results in this regard. We have managed to introduce ourselves again in international conferences, and take measure to retrieve our brand. Currently, IRISL brand rises just like the Iranian flag in all IRISL fleet in every corner of the world.

say that now, 90 % of the IRISL fleet travel in international waters and dock at world’s greatest ports under the sacred flag of the Islamic Republic of Iran. The remaining 10 % also do not carry Iranian flag owing to our economic interests and increasing our competitive capacities. Overall, raising Iranian flags on our fleet again was yet another honor that IRISL managed to confer.Dr. Saeedi emphasized that IRISL will utilize the merits of JCPOA as a launch pad for continuing its growingly enhancing trend, and added that ever since September 2015, IRISL commenced negotiations with foreign companies and signed memoranda of understandings. Hence, when JCPOA was executed on January 16th 2016, all the agreements and

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IMIDRO Director:

We Will Promote Iran’s Position in the Global Steel Market

Today, the Middle East is known as the world’s fuel source. It is a widely established fact that oil well “number 1” of the Middle East was drilled in Masjed Soleiman, south west Iran, in 1908. Iran has always been recognized throughout the world as a country with rich mineral and underground resources. Thanks to its unique geographical conditions, Iran is home to abundant sources of various types of minerals, from iron ore to uranium, gold, copper, zinc, and the like, which could be found and extracted all over this vast terrain.Abundant and accessible resources of iron ore on the one hand and the growing need of this developing country to steel have turned Iran into one of the pioneer steel producing countries in the region. Iran established its first modern steel factory in 1937, today, thanks to its various steel factories, Iran has managed to set a high production record and even export steel to other countries.In order to utilize Iran’s mineral resources more efficiently, the government established Iranian Mines and Mining Industries Development and Renovation (IMIDRO) in 2001. IMIDRO is comprised of eight main corporations and 55 operational companies in the field of steel industries, aluminum, copper, cement and minerals. In President Rouhani’s administration, Dr. Mehdi Karbassian was appointed as IMIDRO’s director. Dr. Karbassian has a Ph.D. in Management from University of Paisley, Scotland, and he also serves as the deputy to the secretary of industry, mine and commerce. Below, you can find the transcript of Payam- Darya Magazine’s interview with Dr. Karbassian:

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Iran enjoys a large volume and a wide variety of mineral resources, particularly the iron ore. What macro approaches has IMIDRO taken to utilize these capacities? Is it selling raw material, or it is setting production chain and selling final products?Given that we have one of the largest gas resources of the world and we have access to inexpensive energy, it is crystal clear that we have opted for creating production chain in order to preserve our national interests, enhance production in the country and gain benefit from iron ore and other minerals’ added value. We have been very successful in the steel industry: We have promoted

Iran’s steel production capacity from 21 million tons to 31 tons in the past four years. Besides, we have taken successful steps in completing steel production chain as well as producing its subsidiary products such as concentrate, pellet and sponge iron.

Pellet is one of the main materials needed for steel production. Considering large pellet production factories in Iran such as Chadormalu and Yazd Complex, are we self-sufficient in this regard? If so, do you have any plans for exporting pellet?I am afraid not. As I already stated, we are in possession of inexpensive energy, and hence, we intend to focus on final product.

Steel industry is a top priority for us. To this end, we have to move toward producing and delivering specific and stainless steel. In this regard, I must add that, based on the latest speculations, Iran is one of the richest countries in the field of iron ore with reservoirs of over 3 billion tons. Our ultimate goal is reaching the production tonnage of 55 million tons of steel by the horizon of 2025. Even though the mentioned reserves are sufficient for accomplishing these goals, IMIDRO has set out to discover more reservoirs in the past two years. Based on these plans, we have managed to cover an area of 250 thousand Km2, and managed to discover 400 million tons of resources and mines of iron ore,

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coal and the like. Accordingly, it could be asserted with certainty that Iran is one of the richest countries of the world minerals-wise.

Last year, given the execution of JCPOA, Iran found a special opportunity to expand its collaborations with foreign countries and international investors. What measures did you take in order to absorb investments after JCPOA, and what accomplishments did you make?Without a tinge of a doubt, JCPOA has been a turning point in the domestic and international arena in the recent years, since we had been encountering numerous difficulties prior to that. Large corporations and international firms refused to collaborate with us, and even if some cooperation was offered, they sent their low-level experts to Iran, even without giving them the necessary authority. Nevertheless, in the post-JCPOA era, the circumstances have been completely changed, and high-ranking executives of huge Canadian, Australian and European corporations have been traveling to Iran for collaboration and making partnerships. These visits are still ongoing and they have led to signing of valuable MOUs. Thanks to JCPOA, we have managed to hire the most technologically updated counselling in the fields of research and training. However, things are going slow in the area of investment. It is unfortunate that the Americans and some European countries have not fulfilled the commitments made in JCPOA. Despite these conditions, we

have signed good contracts with world-class credible companies in terms of investment, fund supply and technology. As a case in point, in the field of Titanium, 450 million tons of minerals that were discovered in Kahnouj, Kerman Province, had been left unattended. Yet, we are currently collaborating with Australian and European companies, we have taken initiatives and are on route toward operation. We have had good progress in other areas, as well. Very recently, we have

Our ultimate goal is reaching the production tonnage of 55 million tons of steel by the horizon of 2025

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commenced the construction process of steel machineries and equipment factory in Eshtehard, Alborz Province, with the help of the Italian Danieli Group, which in a reputable corporation in this field.Iran witnessed a noticeable growth in steel production last year, in a way that it was placed among the top 15 steel manufacturing counties. Does this increase in production merely serve to cater to the domestic needs, or is exporting

being considered as well?Certainly, export is a top priority here. In fact, we set a new record for steel export in 2016. We exported approximately 4 million tons in 2015, but this rate reached 6.5 tons in 2016.

Which countries were the target markets of these exports?The main targets were European countries. Some volumes were also exported to Asian countries such as Thailand. Overall, we have managed to earn a position in the

world market for Iranian steel, and we are well capable of achieving bigger successes in the future.

What plans does IMIDRO have for expanding its export market?Given the facilities and resources at our disposal, both the prices of our producets and their quality will be competitive. We do prognosticate that by the year 2025, we will have reached the export capacity of 14 million tons in steel industry.

One of the accusations against Iran’s mining industry, particularly pushed by European countries, last year was the issue of dumping. Did this accusation have any basis? If not, how could we respond to it? This accusation was and is absolutely baseless. The accusers had targeted Foulad-E-Mobarakeh Co., which manufactures steel sheets. The accusations were made due to two main reasons: First, the competitors of Iranian steel lost their market when Iranian steel products entered Europe, so to much so that the Italian automobile manufacturers submitted a written complaint to Italian government and European Union officials, complaining that prior to purchasing Iranian steel, they used to buy steel at an unfairly expensive price in an non-competitive market. Second, as I stated earlier, Iran enjoys abundant raw materials as well as accessible and inexpensive energy; hence, it could deliver final products that have competitive prices, and by no means could this be considered dumping.

Brazilian Ambassador:

Brazilian EconomyPicks up Again

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Could you please provide us with a general picture of Brazil-ian economy? Brazil is the world’s 9th largest economy. IMF expects that rank-ing to improve further; Brazilian GDP totaled R$ 6.226 trillion last year. With a population of more than 200 million people creating one of the world’s largest consumer markets, Brazil brings together the main elements for attracting foreign capital, it enjoys a safe investment environment and an extensive portfolio of business opportunities, especially in in-frastructure, for which demand has grown significantly in recent years. Possessing vast natural resources, the country offers potential invest-ments in energy, oil, gas, mining, agriculture and industry. The gov-ernment also plans to expand and modernize the logistics system with the new concession model for railroads, highways, ports and, eventually, airports. After an unprecedented economic recession in 2015-2 016, a consis-tent recovery is now underway in Brazil. GDP will return to growth in 2017, albeit at a still modest

rate. In 2018 growth is expected to pick up pace. A number of ad-ditional economic indicators give reasons for a positive assessment about the perspectives for a sus-tainable economic recovery. In-flation rates are converging to the center of the target range .Now, the inflation rate is under the control in Brazil. The current account deficit has dropped dramatically in recent years, and is now slightly above 1% of the GDP. Foreign Direct In-vestment (FDI) flows continue to be robust and Brazil remains one of the main recipients in the world. High levels of foreign exchange reserves are a solid buffer against any possible global uncertainties. In this more favorable outlook, the Government of Brazil will contin-ue to attach highest political prior-ity to reforms and fiscal measures that promote a sustainable path for public accounts.Brazil foreign trade, after an in-crease in 2013, declined at an annual average rate of -8.5% in exports and -16.9% in imports. Exports decreased from US$ 241.6 billion in 2013 to US$ 184.5 billion in 2016, while imports de-clined from US$ 241.2 billion in 2013 to US$ 139.4 billion in 2016.

In the 2013-2016 period, the cur-rent account deficits, as a percent-age of GDP, reached 3.0%, 4.2%, 3.3% and 1.2% in each of those years. At the same time, the coun-try has remained attractive to for-eign investment, mainly foreign direct investment (FDI), which to-taled US$79 billion in 2016. Thus, the current account deficit was fully financed by net FDI inflows. International reserves remained at high levels, reaching US$372.2.6 billion at the end of 2016, bol-stering the ability of the Brazilian economy to face external shocks. In February 2017, the stock of in-ternational reserves represented US$375.3 billion, four times more than the debt service for the 12 months ahead.Regarding the destination of goods, exports to Asia decreased 20.6%; to South America, 26.9%; to North America, 7.1%; to Eu-rope, 28.7%; to Africa, 29.4%; and to the Middle East, 7.4%. Brazil is a real “global trader”, which is a good advantage to its foreign trade since it does not depend so much on a single market or region. Manufactured goods accounted for 37.9% of exports, semi-man-ufactured goods for 13.5%, agri-

A number of additional economic indicators give reasons for a positive assessment about the perspectives for a sustainable economic recovery

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cultural and mineral commodi-ties for 46.1%. The remaining 2.5% are related to special opera-tions. The main industrial exports were aircrafts, automobiles, auto parts, sugar, cellulose and semi-manufactured steel. The main commodities exported were iron, oil, soy, beef, coffee, corn and to-bacco. Raw materials and intermediate products had a share of 57% of total imports in the 2013-2016 period. These were followed by consumer goods (15%), oil and gasoline (14.7%) and capital goods (13.3%). Pharmaceutical goods, auto-parts, oil, fertilizers, automobiles and electronic goods were the main exported goods.

Could you please explain the main reasons for experience some recessions in Brazilian economy in the last two years? During 2015 and 2016 years, be-cause of the world economic re-cession with the financial crisis in US, Europe and China, the credit shrank in the world, it resulted in a decrease in their economic growth. At that time, the Brazilian govern-ment used what they called, anti-cycle economic policy, so, it tried to expand credit in the economy through the official state banks. As a result, it could compensate the lack of credit that we were suffering due to international fi-nancial crisis, so the national de-velopment bank and some other commercial banks which are managed by Brazilian state, ex-panded credit in Brazil.We also had an easy fiscal policy which increased expenditures, based on this policy, the govern-ment was expanding its expendi-tures and at the same time, offered some facilities to the private sec-

tor for example; tax exemptions, in order to alleviate the problems of international financial crisis, and pick up the economy again.With this anti-cycle economic policy, the government was able to recover economic growth again, however, it led to an increase in our fiscal expenditures.Our goals during all the previous years including; primary surpluses and decreasing the net public debt step by step, were revert in that pe-riod, because the government was expending more and giving fiscal exemption, which resulted in an increase in our public debt again, this was a cause of concern in the international financial market, be-cause of this vigorous increase in the fiscal policy, Brazil started to experience inflation problems. Of course, the inflation rate never came up to more than two digits again, but this increased and public debt increased as well. The macro-economic stability was in danger, so we had not the same good re-sults which we had in the previous years, this led to lower expecta-tions from economic agents from both Brazil and abroad. In that period, there was also a period of political instability, the congress and supreme court had impeached Brazilian President Dilma Rous-seff for fiscal problem, they con-sidered that she went against the fiscal responsibility law, which tells us you cannot spend more than what you have in terms of revenues.In a nutshell, we had a combina-tion of political instability and negative expectations from the economic agents due to the fiscal problem. But this year, thanks to a changing in economic policy, we are com-ing back now, the new government has introduced fiscal responsibil-

ity, cutting expenditures, control-ling deficit, keeping the inflation targeting and also the flexible ex-change rate, we are back to three pillars that led Brazil to experience economic growth at a rapid pace. Now, the expectations are good, that is why, the domestic econom-ic agents is resuming investments, but it must also be added that for-eign direct investment never stop in, they were very vigorous even in years of recession. Of course, we are still passing through a difficult moment in Bra-zilian politics, but a good thing is that the market disconnected from this political instability, in

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the previous years, it was thought that political instability could lead to economic failure. Now, even if political situation is not totally recovered or stabled, but the eco-nomic performance is getting bet-ter. Now, the economy of Brazil is strong enough and the government is doing the right policy to recover and get a sustainable economic growth. The trade balance registered a US$ 21.4 billion surplus in the first four months of the year 2017. The number is a record for the period, leading to an accumulated trade surplus of US$ 55.4 billion for the last 12 months, also a record high.

The stability of the Brazilian fi-nancial system has remained high in recent years, although the real economy adverse scenario has affected credit risk indicators, re-sulting in cautious credit granting policy as well as low borrower de-mand. The level of credit in Brazil still seems modest in international comparisons, as mentioned in the IMF (International Monetary Fund) /WB (World Bank) FSAP (Financial Sector Assessment Pro-gram) report. Moreover, in Brazil, the Capital Adequacy Ratio is double com-pared to international standard requirements, banking situation

in Brazil is very good and stable. Meanwhile, the liquidity of Bra-zilian banks is very strong. Fam-ily indebtedness rates and default levels, including for companies, are falling. The public sector is now seeking fiscal consolidation in accordance with the principle of fiscal respon-sibility, one of the pillars of Bra-zil’s economic policy.

Where do you see Brazil econo-my in 2017? The Brazilian government has implemented a diverse economic reform program and this clearly indicates a new moment in the

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country’s history. The recession and inflation are now under con-trol and Brazil remains firm in its efforts towards economic and so-cial transformations that will con-solidate an increasingly safe and attractive environment for foreign capital. Economy is on the rise and there is an estimate of 0.5% GDP growth in 2017 and 2.5% in 2018. Infla-tion is decreasing and the market projections point to 3.9% infla-tion for 2017 and 4.3% for 2018, both below the center of the coun-try’s inflation target (4.5%), ac-cording to data from the Central Bank’s Focus survey of indepen-dent market analysts published in 05/12/2017. The net direct investments in the country reached US$ 85.9 billion in the 12-month period to March 2017. Brazil is the one of the world-lead-ing agricultural producer with the

and the government has predicted more investment in this regard. Meanwhile, biomass is very im-portant for Brazilian electricity generation capacity and it is go-ing to rise from 11 percent in 2014 to 18 percent by 2024. There will be more investments in solar and wind energy as well.

Oil, LNG and Gas production is also increasing in Brazil and the prospective for the future is very good. Today, we produce around 2.5 million barrels of oil and gas and LNG and gas per day and this will picked up to more than 3 mil-lion barrels in the next year. There are new rounds internation-al bids of exploration of oil and gas in Brazil, so it could be said the perspective for investors is so good. Oil and natural gas extrac-tion forecasts are at record levels, as is the case for agricultural har-vests.

prospect of 234.3 million tons of grains, making for a record 2017 harvest. Brazil having the international reserves of U$$ 374.9 billion in April 2017. The country risk, a predictor of external confidence in the funda-mentals of the Brazilian economy, is in decline. In March, Moody’s revised Brazil’s outlook from neg-ative to stable. Domestic confidence in the econ-omy saw strong recovery last year in all sectors: industry, retail, ser-vices, construction, and also from consumers. It is worth noting that one thing that creates a lot of opportunities for Brazil in terms of economic growth, is electricity generation capacity, Brazilian energy matrix is considered as one of the clean-est in the world, because it is very much supported by hydroelectrici-ty, which does not create pollution,

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Most people abroad think that Bra-zilian economy basically relies on agriculture and commodities, but that is not correct, the composition of Brazilian GDP is more concen-trated on industries and services than agriculture, of course, the contribution of the agriculture for Brazilian economy is important, it is around 20 percent, but we en-joy the very diversified and strong industry and it contributed a lot to Brazilian GDP.

What are your plans for facili-tation of banking relationships between Iran and Brazil?Today, Iran-Brazil bilateral trade is around 2.5 Billion US dollars, we see a lot of potentials in many areas in both sides, we are also in-terested in an increase in our ex-ports to Iran, on the other hand, Iran could also export products like petrochemical, fertilizer, oil-products in general, chemicals, so Brazil is ready to import from Iran, of course, it depends on price, specification, transportation and banking relations.

In the next month, Iranian Central Bank (CBI) is sending a delegation to Brazil, so, the two countries will talk about the possibility of having direct links, in Brazil, we have some state-managed banks and a national development bank, which also plays the role of Eximbank- export and import bank-, they have their own credit lines to facilitate export and import, but basically Brazilian export, so we may offer this to Iranian side, but of course, it depends on financial mechanisms to guarantee those credit lines, that is what we like to discuss with Iranian government.

Moreover, we have also some banks that are interested in

contacting with Iranian banks, we have seen that Iran has been able to establish some direct links with some European countries and settled down some financial arrangements, this may happen in Brazil, in a nutshell, we will discuss all issues during CBI’s visit to Brazil. Of course, there is a good cooperation between Brazilian Central Bank and Iranian Central Bank, it is important to highlight that there is no obstacle from the Brazilian government for having direct links with Iranian banks.Moreover, Brazil proposed Iranian side to use local currency, as a means for facilitating and promoting bilateral trade. We will also negotiate to establish local currency settlement between Brazilian Central Bank and Iranian Central Bank.It must be added that Brazilian Central Bank is also talking about the possibility of Iranian banks to open subsidiaries in Brazil.

In your perspective, what impacts has the lifting of sanctions and the execution of JCPOA exerted on the expansion of ties between Brazil and IRISL?JCPOA brought about significant impacts on the relationships between Iran and the world.

The implementation of JCPOA motivated Brazil even more to do business with Iran.Generally, the interest to investment in Iran has considerably increased. Now, we know that there is a better business environment in Iran, and Iranian government is very engaged in economic reforms and provides more room for the private sector, also reforming

the domestic economic agents is resuming investments, but it must also be added that foreign direct investment never stop in, they were very vigorous even in years of recession

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the investment legislations and signing new contracts in oil and gas sector, can be more incentives for foreign investors to make an investment.Brazil is interested in investment and manufacture in Iran, my country is very strong in sectors such as in oil, gas and medical and transportation equipment.On the other hand, Iranian side could also invest in Brazil in sectors such as energy, agriculture, we will welcome Iranian companies. Today, Iran-Brazil bilateral trade is around 2.5 Billion US dollars, we see a lot of potentials in many areas in both sides, we are also interested in an increase in our exports to Iran, on the other hand, Iran could also export products like petrochemical, fertilizer, oil-products in general and chemicals. It is worth noting that Brazil is negotiating with Iran for maritime transportation agreement, which will facilitate this kind of transportation between the two countries.

What plans dose the Brazilian government has in mind to en-hance economic growth? The Government will undertake efforts to put in practice a real agenda for productivity; profes-sionalization of state-owned en-terprises; autonomy of regulatory agencies; improvement of labor rules; regulatory frameworks that observe economic rationality; im-provement of infrastructure; and focus on legal security. High rates of unemployment, a result of the 2015-2016 economic recession, remain a core challenge. Brazil is experiencing a unique moment in terms of investment opportunities in the global sce-nario, driven by the government’s commitment to the advancement

of the most profound structural re-forms of the last decades, control of public spending and implemen-tation of economic measures that put Brazil on the path to sustain-able growth. As a result of the new economic policy being in force, the country has overcome the worst recession in its history in the first quarter of

year, and is expected to follow an upwards trajectory from now on. The resumption of growth is an-chored in the solidity of Brazilian institutions and the capacity for dialogue among the three Gov-ernment branches, both determin-ing factors for the execution of an agenda of transformation of the Brazilian reality. Foreign investments opportunities are open for all interested coun-tries. This indicates that the new Brazilian government has made necessary refinements to the In-vestment Partnerships Program (PPI). The changes led to greater transparency, competitiveness and legal certainty for foreign inves-tors. The investment opportuni-ties, however, are not limited to infrastructure investments. The excellent performance of Brazil’s agricultural sector positions the country as a leader in the produc-tion and export of sugar, coffee and orange juice, and as the largest global producer of soy and beef. Brazil is carrying out an ambi-tious reform agenda and regain-ing investors’ confidence. One of the axes of the measures is fiscal control and the curbing of public spending. The Executive’s capac-ity for dialogue and joint efforts with the Legislative have been fundamental in ensuring the adop-tion of measures to make the State more efficient and modern. Being aware of the importance of part-nerships with the private sector, the country has made advances in several areas in order to stimulate the generation of wealth. The Government is committed to bring public deficit and debt to a more sustainable trend. A 20-year constitutional limit for the increase of total federal primary spending according to the previous year’s inflation rate has been approved

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There are new rounds international bids of exploration of oil and gas in Brazil

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and a social security reform is be-ing discussed at the National Con-gress.

The Government will also con-tinue to invest in family farming through public purchase, with an expected investment of 806.6 mil-lion dollars until 2019. For this purpose, the Government is work-ing on strengthening the institu-tional purchase modalities of the Food Purchase Program (PAA), which allows institutions from the public administration to purchase food from family farmers through the program. Strengthening and supporting the multilateral trading system will remain a priority. Brazil will con-tinue to play an active role in the WTO and will contribute to coun-ter anti-trade movements and pro-tectionist pressures. In light of the diversified nature of its trade and

production structures, Brazil has a major stake in a multilateral trad-ing system that is able to provide the basis for the expansion of in-ternational trade on a non-discrim-inatory basis. Achieving balanced, development-oriented results will be at the core of all efforts. Brazil will also continue to be com-mitted to MERCOSUR, regional integration – as mandated by its Constitution – and to strengthen-ing and fostering new bilateral and regional trade agreements, with a view to promoting cooperation, sustainable development and mu-tually beneficial results. With support from the National Congress, the government insti-tuted the New Public Spending Regime, which establishes a hard ceiling for increases in govern-ment expenditures. Labor Reform seeks to modern-ize legislation and increase flex-

ibility for employment contracts, strengthening the reach of collec-tive bargaining agreements. President Michel Temer’s Admin-istration is deeply engaged in the approval of Pension Reform. The new retirement rules are aimed at controlling the named deficit in Brazil’s Social Security system. The government also intends to propose a new bill to enact a sweeping tax reform to deeply modernize the country’s tax pay-ment system. Reducing the role of the State in the economy is another reform pursued by the government. The government has stepped up its trade agreement efforts, including through the resumption of nego-tiations between Mercosur and the European Union. The government has been simpli-fying processes for the exports and imports.

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Iran’s Industrial Sector; An Opportunity to Gain Profit

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We should call the 20th century, the century of industrialization; a century that for every industrial progress, human’s life proceeded towards more well-being so much so that the meaning of industry development was equal to welfare.The man of the 20th century who witnessed two devastating wars in order to achieve a better life and more organized one went more and more towards using the element that is his handmade. This element was the human invention and considered as the achievement of human life.Although, this excessive use of ability to create a better society caused human being to move toward unreasonable exploitation of nature more than ever, what would satisfy the man of the 20th century, especially after the World Wars, was the relaxation following funny economics. As already mentioned, the driving and well-being engine of prosperity was searched in the industry and its artifacts. Meanwhile, the result of this prosperity was nothing but an increase in the economy that was the only demand of human being. Accordingly, the countries stepped toward industrialization, namely modernization based on their power and share of the world economy.With the arrival of the new century, the paradigm of well-being and welfare in the lives of human beings is still defined from the view point of development, especially by means of industry. However, this time, the industry also took on a new meaning. While in the past the term “industry” only applied to the construction of machinery and oil as well as transportation industry, this time it is not only the hardware of the industry but also software production which

Iran having an acceptable position at the global balance in terms of engineering growth has also entered in the field of IT and ICT at least to take steps in supplying the domestic needs

was changed the norm of human life. Change in the norm of human life and the different approaches caused growth to be equal to the increase in industry; however, this industry had a much wider meaning.The industry vast extent means the more possibility to share knowledge and the ability of the rest of the world to progress. Therefore, although industrialization and the Industrial Revolution was a whole West meaning, in the early days of the new century, the rest of the world has also reached some achievements in this issue that it must be admitted to be one of the most important causes of this proposition, if not saying that it was central to construct the

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concept of “globalization”.Southeast Asian countries that have focused on the new artifacts which were no longer only hardware-based, have gently adapted themselves and could introduce themselves to the world. However, one issue was quite necessary for all these countries besides their Western competitors, which was the raw material!The necessity of raw materials for economic and industrial development is important to the extent that we shall understand that the countries which are the owner of materials have a special significance in the geopolitical map of the world. Therefore, if a country would like to have such an important position, it must own both the raw material and industrial power at the same time. Iran as the world’s largest owner of oil and gas reserves and one of the biggest countries with the mining industry, owns one of the important elements of the proposition, however, few people thought that it could move towards industrialization due to being located in a region that was constantly colonized over the past century.But the differences between Iran

the driving and well-being engine of prosperity was searched in the industry and its artifacts

and elsewhere in the region were in one principle, namely the extent of the world and the population numbers. Since the mid-twentieth century, Iran with the participation of foreign companies moved towards creating some platforms for the industry. One of the most crucial industries that could enter Iran in the club of industrialized nations of equipment was the construction of the steel plant.Accordingly and with steel production, Iran more than ever was in a position to create a platform for the use of steel artifacts, so, in the mid-40s of solar calendar it launched one of the world’s largest automobile production line with the cooperation of English engineers.But this is not the whole story of Iran’s industry. Considering the huge oil and gas reserves, this country discovered the necessity to create a value chain and its consequence was the construction of the petrochemical complex in Iran which has spread almost throughout the country. Moreover, it included a significant volume of industrial production and exports of Iran.As already mentioned, the new century was another century, and the meaning of industrialization also meant something else. Hence, Iran having an acceptable position at the global balance in terms of engineering growth has also entered in the field of IT and ICT at least to take steps in supplying the domestic needs.Maybe this is a new industry in Iran; however, its growing trend over the last two years has created an astonishing added value of $ 14.5 billion in the previous year, promising the emergence of a new pole in this section.But what is important for any development is the infrastructure

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and financing and the requirements of these two are defined in constructive engagement.When at the beginning of January 2015, JCPOA shone on the relationship between Iran and the world, the investors once again acknowledged the special position of Iran.Creating proper grounds and the attraction of some industries and mines led the countries of the world move toward cooperation in order to gain profit.We could see the result in several important contracts with Western car makers, including Peugeot Citroen, Renault, and Mercedes. Moreover, another achievement for both developing the relationship and advancing industry is the creation of a joint factory with Peugeot with the purpose of export. In addition, after many years, the petrochemical production reaches the staggering number of more

than 55 million tons as a result of the creation of appropriate platforms for the petrochemical industry that is remarkable by itself and this is one of the greatest achievements of Iran in the field of investment.If we put these propositions together, due to having huge reserves of minerals as well as

stability and security, we can acknowledge that Iran could transform itself to be a well-respected country at industrial level by the efficient use of economic diplomacy and development of the infrastructure. Everybody knows that the meaning of this feature is opportunity and opportunity equals profit.

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In the Post-JCPOA:

Iranian Handicrafts Exports TripledThe term “handicrafts” is used to refer to the crafts that have partially or totally manual production processes, and are created within the frameworks of a nation’s culture, philosophical beliefs, creativity and humanitarian art. Handicrafts stem from the tribal, national and historical treasures; and that is what differentiates them from the similar products that are produced by factories and machines. Iranian handicrafts have a special top position throughout the world. One of the features that make Iranian handicrafts so remarkable and valuable worldwide is that it reflects the glory of creation and the aesthetics that Iranian artists have managed to perceive and internalize. Indeed, each and every color, angle, combination and pattern in Iranian traditional art and handicrafts symbolizes profound philosophical, mystical and literary concepts and meanings.In order to shed lights on different angles of issues related to Iranian handicrafts, its worldwide position and the impact of post-JCPOA atmosphere on its exports, Payam Darya Magazine sat down for an interview with Dr. Bahman Motlagh Namvar, the handicrafts deputy at Iran’s Cultural Heritage, Handcrafts and Tourism Organization (ICHHTO), You can enjoy the transcript of this interview in the upcoming paragraphs:

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Could you please explain why Iranian handicrafts have a special top position worldwide?Handicrafts are closely connected to human resources and individual creativity, and in fact, it is handicrafts that show off a nation’s industrial, artistic and cultural identity. In other words, if we wish to find out about a nation’s aesthetics, taking a glance at their handicrafts will suffice. However, the value of handicrafts is by no means restricted to their spiritual aspects; rather, handicrafts possess particular materialistic and financial features of their own. In the context of Iran, handicrafts are usually classified under exports-based industries, and a large bulk of the currently produced handicrafts are exported (approximately two thirds of the current production). No doubt,

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world over. Iranian handicrafts are profoundly rooted in Iran’s rich culture and ancient beliefs. Finally, the role of handicrafts in Iran’s economy and its contributions to economic development and low-budget high-efficiency entrepreneurship cannot be denied.

What impact did the lifting of the sanctions and the execution of JCPOA exerted on the export of Iranian handicrafts?It was very unfortunate that sanctions threw a large number of problems at Iran’s handicrafts export. These problems were so frequent and massive that caused Iran’s role to face away in the markets that it once captured and dominated for years. Nonetheless, with the rise of President Rouhani’s administration and a change in Iran’s approach

we are currently faced with the remarkable flood of international tourists and world travelers to Iran

handicrafts are responsible for millions of dollars of Iran’s revenue.I must add that handicrafts have a much higher added value compared to other industries. A start-up business in the field of handicrafts does not need huge investment; entrepreneurship in this field is easier and less expensive than in many other businesses. When it comes to counting the features of Iranian industry, the originality and genuineness as well as the old history are the first things that come to the mind. Moreover, International Council of Handicrafts has it that Iran enjoys the widest variety of handicrafts in the world. It is so since Iran is home to diverse tribes and races, and each tribe has created its own manually-created craft depending on its culture, identity, race, beliefs, legends and the climatic conditions of its habitants.Another advantage that could be count for Iranian handicrafts is its being luxurious and classy, which is barely ever seen in the crafts of other countries. Moreover, Iranian handicrafts enjoy a broad scope of variety, not only in terms of type and material, but also in terms of price. Iran produces affordable and low-price handicrafts, and as well, produces crafts such as etching, which is worth millions of dollars. Iranian handicrafts stay on the top of their kinds in the world when it comes to etching, textiles, woodwork and pottery.In a nutshell, as an independent and 100 percent local industry, Iranian handicrafts comprise Iran’s most remarkable practical art, and place Iran among the top 3 producers of handicrafts the

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to international policies, particularly with the execution of JCPOA, Iran’s handicrafts export witnessed a dramatic change to the positive. The export earned 100 million dollars at the beginning of President Rouhani’s administration, but this figure tripled in the course of the past 4 years, and now we are earning over 300 million dollars from handicrafts export. This figure is still experiencing a growing trend, as well. I must nevertheless add that the figures I just mentioned do not cover the export of carpet, jewelry and ornaments, and the individual handicrafts items exported by Iranians who travel abroad.

Which countries are the most popular targets of Iranian handicrafts exports by ICHHTO?Half of Iran’s handicrafts exports market is in demand and purchased by the countries in the region, and the next priorities are European countries and North America. As I asserted earlier, JCPOA opened a new horizon to Iran’s export conditions. Prior to JCPOA execution, our exports to Britain and the US had terminated, but currently, these two countries rank 8th and 9th in our exports market. Presently, we are concentrating on two large and important markets of Russia and China, and we have set exporting to these two markets as our top priorities for this year. We intend to make a long-term investment in these two markets.

What types of products do you usually export to the target countries?Well, the answer of these

It is promising that since President Rouhani’s administration has taken office, effective measures have been taken to develop and expand the tourism industry, and we are currently faced with the remarkable flood of international tourists and world travelers to Iran. Accordingly, the sales of Iranian handicrafts have experienced a strikingly ascending trend in the holiday resorts. I must add that converting most visited hot spots and attractive sights to flea markets for Iranian handicrafts is a top priority for ICHHTO, since this gives a more adequate retail and delivery opportunity. Our speculations highlight that each foreign tourist, on average, spends over 100 dollars to buy handicrafts.We do keep our fingers crossed that the handicrafts exports continues its ascending trend, and by giving this market the support and back-up it needs, we hope to turn it into a one-billion-dollar business in the current year.

questions mainly depends on the target country. As a case in point, potteries, glass, ground clothes, and decorative ornaments are usually exported to the countries in the region; however, luxurious and classy products such as fine-touch potteries, wooden crafts and textiles are mostly exported to our target markets in Europe.

Given that handicrafts are excellent attractions for tourists, what are your plans and strategies to attract foreign tourists to Iranian handicrafts?

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17 By: Hanieh Eftekhari Sanctions delivered a great blow

and put pressure on the already frail body of the Iranian economy, i.e. an economy that was already staggering suddenly met a tornado, while the car industry, which was on the verge of revival and removal of various challenges was hit by serious difficulties.According to pundits in July 2013 and following a direct order by Obama, the Iranian car industry reached the limits of bankruptcy. This industry was among the few hit by direct US sanctions, following which, their production plummeted to such an extent that in 2013 their performance

Carmakers Cross the Sanctions’ Red Light

dropped to half the 2011 figures. This was at a time when before the sanctions were intensified, the auto industry had been able to increase its production by tenfold during the ten-year period between 1999 and 2009. This increasing trend continued on until 2011 and with a production number of 1.6 million different types of vehicles Iran was able to secure a place among the top 10 car manufacturers in the world.Before the sanctions, the Iranian auto industry was able to accomplish joint production with a number of European brands, which given the relations

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Hyundai and Kerman Motors signed the contract for production of the two models of i10 and i20 in the Arg Special Economy Zone

established with the producers of cars and parts, improved the quality of domestic products.However, the situation changed with the intensified sanctions and the direct boycott of the national auto industry. Thereafter, the relations the domestic carmakers with their European partners met with great difficulties, the most important being the severance of relations with the international manufacturers of cars and parts, which led to the fall of car production in Iran. Although at this stage and to address the problem carmakers looked to China for cooperation, this did not help them in getting back to their heydays of quantity and quality. The drop in production and the limited supply of products alongside the increase in the rate of foreign exchange resulted in the doubling of prices in the country. Despite the efforts made by the monitoring bodies to manage the market situation, the conditions moved towards greater customer dissatisfaction. In the light of falling demands and the high costs of imposed sanctions, the producers reached the limits of bankruptcy. Under such conditions, the cure for

the situation seemed to lie in an opening in the nuclear issue followed by an agreement with the west, to allow a possible return to the previous course of cooperation with foreigners and to take up the trend of importing parts once again.On 17th January 2016 and following many ups and downs and long and breathtaking meetings the Joint Comprehensive Plan of Action (JCPA) was launched and with it, the lifting of nuclear sanctions of the West against our county, including the sanctions imposed by Europe, the USA and the UN

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Iran Khodro in the negotiations, and since the grounds for the venture were paved before the JCPOA, the contract between Iran Khodro and Peugeot was signed with the shortest delay.According to this contract a new company was established under the name of IKAP for joint production in Iran. It officially began its functions on the first day of summer 2016 to produce Peugeot “2008”, “301” and “208” for the domestic and international markets.In the new era of Peugeot – Iran Khodro cooperation, Peugeot 2008 was the first car, which went to mass production in May this year in the presence of the President.

Renault’s race with old rival for presence in IranNot to be undone, Renault, which in the past was active in

Iran, also rolled up its sleeves to begin its negotiations with Iranian carmakers when Peugeot was signing its contract with an Iranian counterpart during the post –sanction era.Renault’s involvement in Iran has its own particular complications. The record of its cooperation in Iran is linked with both the Iranian auto giants, at the time when the L90 platform was made available to both SAIPA and Iran Khodro for production.On the one hand this Company had dealings from the past with Pars Khodro (a subsidiary of SAIPA) and in addition to producing Megane, they manufactured Pars Tondar, Koleos and Sandero in their joint venture, and on the other it supplied a number of products to the market including Tondar 90 and Tondar pickup in collaboration with Iran Khodro.At the time, the managing directors

resolutions.After the agreement, automakers such as Peugeot, which had quit Iran; or Renault, which had dropped the level of its cooperation to absolute minimum; and renowned brands such as Mercedes and BMW, which had suspended their agencies, moved to re-establish their foothold in Iran.

Peugeot at the forefrontThe new era of automotive cooperation in Iran was relaunched by Iran Khodro and Peugeot. In December 2015, when JCPOA was still not implemented, Hashem Yeke Zare, the CEO of Iran Khodro Industrial Group announced the news of negotiations with a European carmaker for manufacturing a joint product.After the agreement, Peugeot was announced as the counterpart of

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of both these Iranian auto industry giants considered themselves as Renault’s old partner and the obvious choice for continuation of the relationship. However, Renault did not sign any contract with these two and instead put its signature in a contract with a third party called IDRO (Industrial Development and Renovation Organization).The new era of France – Iran cooperation in auto industry was launched with the signing of an agreement by Mansour Moazzami, the Chairman of Industrial Development and Renovation Organization (IDRO) and Thierry Bollore Renault’s Chief Competitive Officer on the second day of Paris Auto Show and in the presence of Mohammad Reza Nematzadeh, the Iranian Minister of Industries, The auto

outcomes of JCPA were completed with the initial agreement between SAIPA and Citroen. These two companies, which began their collaboration fifty years ago with the production of Jian (2CV), and had a successful experience with Xantia, renewed their cooperation in July 2016 with the signing of an agreement to establish a joint SAIPA – Citroen Company.According to this agreement, the investment in this venture will be 50 – 50 with the first common product expected to hit the market by the end of 2017.

High profile presence of Koreans in IranAlthough the European automakers and in particular the French companies were the forerunners in the new cooperation with the auto industry in Iran, the renowned Asians were not left behind and with a contract between Hyundai and Kerman Motors, the Asian carmakers also secured their footing in Iran as well.Hyundai and Kerman Motors signed the contract for production of the two models of i10 and i20 in the Arg Special Economy Zone, but currently the news point to the marketing of Tosan, Santa Fe and Sonata 2017 by this Company in Iran after the production and supply of i10 and i20.

Mercedes’ green light to IranIn addition to the French companies, Germany’s Mercedes Benz also returned to Iran after JCPA. Before this, Mercedes cooperated with Iran Khodro in the assembly of sedans and with Iran Khodro Diesel for production of commercial vehicles. However, its involvement with this company even at the level of sales agency

Peugeot – Iran Khodro cooperation, Peugeot 2008 was the first car, which went to mass production in May this year in the presence of the President

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production of vehicles that have been on the international market for a maximum of three years. Furthermore, the export of products to regional or other countries was among the demands of Iranian companies in these contracts.

Car industry waiting for a renaissanceAlthough there are different opinions on the future of the auto industry in the wake of opportunities created by JCPA, the pundits all agree that the agreement has set the right conditions for its development and that carmakers must take the right choice in this course. This issue is important in the sense that Iranian automakers have been able to renew their relations with their international partners after years of severance. Consequently, one of their most serious problems, i.e. the supply of original parts and materials, has been resolved with the reestablishment of relations. This is a welcome event for the auto industry.Furthermore, another issue faced by automakers following the sanctions was the lost opportunity to develop products with foreign partners. Therefore, after the agreement this obstacle is being gradually removed as well.Many auto-industry experts see the current situation fit for a renaissance in the domestic car industry. It remains to be seen what solutions the industry’s executives would opt for in using the state of the art technology in the light of the new conditions and renewed interaction with the world.

and aftersales services came to a halt.Then, in the early days of JCPA, Mercedes relaunched its new era of cooperation with Iran and selected the Setareh Iran Company as its exclusive agent for sales of its products and provision of aftersale services.In the meantime, Mammoth Company also clinched a joint investment deal with Volkswagen. According to their contract the two companies will hold 50% shares each of the newly established Mammoth Khodro Company to produce Volkswagen cars in Iran.

Production of modern cars in IranBut the important note in all these contracts is the acceptance of the Iranian companies’ terms and conditions. According to the directives of the government and the Ministry of Industries, the presence of foreign companies in our car market will be accepted only if in the joint investment with their domestic counterparts, the foreigners’ equity would be over 40%. Another condition included in all contracts is the

presence of foreign companies in our car market will be accepted only if in the joint investment with their domestic counterparts, the foreigners’ equity would be over 40%

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Total & N.I.O.C Contract:

In Counterpoint toSanctions

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Fruits of Energy Diplomacy and Smile in Gas Capital of Iran

By: Hoori Ghasemi

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24 Nov 2013 was a date in which foreign affairs minister of Iran and 5+1 members hugged each other to show the world that diplomacy is still the power to solve many problems. The initial step to reach JCPOA and consequently sanction removals was taken at this date and thereafter the ways for economic developments in many reals especially oil were paved.In fact Hasan Rohani as the 11th president of Islamic Republic of Iran appointed Mr. Zarif as the minister of foreign affairs and Zanganeh as managing director of oil ministry, activated diplomacy and the role of Iran in International equations. This was materialized in the 11th government and part of the sanctions was removed while returning energy diplomacy to Iran, more activities and reconnecting to international markets.In other words, Iran has followed specific targets in the realm of energy since 2013 and appointing Bijan Zanganeh for retaking control of the ministry of oil was the first step to do so. Zanganh who is a well-known character in the field of energy, managed to place Iran within the key and effective countries in the world of energy immediately after nuclear agreement between Iran and 5+1 countries.He prioritized that plans in the early days he stepped in the oil ministry and prioritized the projects that Iran could not complete due to not being able to take the foreign currencies in the borders and hence, the projects faced lack of budget. Prioritizing gave the projects with rapid development the opportunity to move forward sooner than other projects.

Prioritizing was done and developing different phases of South Pars gas field were placed within the top antecedenees in the oil ministry and that is how we witnessed 11 phases to be complete in past three years and half in the biggest shared gas field in the world. In the first place, phase 12 became operational in March 2013 and phases 15 and 16 stepped into operation afterwards. Finally, six phases were utilized and came into operation along with extraction of oil from the oil layer of South Pars oil field which was accomplished on 17 May 2017. In parallel with these phases, four refineries came into operation after sanctions removals and that is how the message of power of Iran in post sanction era was released all over the world.Accomplishing six phases of South Pars was a big achievement of oil industry in Iran and if ministry of foreign affairs could not manage facilitating the process of oil sale and receiving money out of oil from beyond the borders and granting permission for required facilities to enter Iran could not stop gas flow to Qatar territory in South Pars field.Accomplishment of six phases in South Pars (17, 18, 19, 20 21) is remarked as the biggest inauguration in the history of oil in Iran which lets Iran to extract gas as much as Qatar does. In fact, the development of the phases of South Pars dates back to 10th government in Iran which had planned to complete the phases in 35 months but unfortunately faced the sanctions and consequently were halted to move forward and develop. In the 11th government, through reaching the agreement between Iran and 5+1 (called

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JCPOA), accomplishment of the phases again revived and moved forward with more pace and at the end of 11th government they came into operation.Oil ministry’s managing director regarding the sanctions removals and the impact of it on the gas project developments believes that the facilitated financial transactions and available letter of credits (LC) along with reapplying compressors and importing valves and other necessary supplementaries played a big role in developments.In fact, after JCPOA, the first foreign trade group who stepped into Iran were Germans. The blocked facilities including 10 Off-Gas compressor and six refrigerant compressors were freed and delivered from Siemens to Iran through the continued negotiations with this team. The above-mentioned facilities consequently were applied in the 12th phase of South Pars.Meanwhile,six more compressors made by Siemens were delivered to be applied in 17 and 18 South Pars phases in March 2016. At the end of first quarter, Phase 17 and 18 along with 20 and 21 enjoyed pipes, jointures and faucets made by well-known European companies. Phases 20 and 21 also took advantage of European-made air blower in sulfur making section. Furthermore, turbo expanders for ethane recovery were other facilities which were ordered to be applied in the phases 19, 20 and 21 that could not be accomplished out of JCPOA.However,the sanctions were not the only reason for the plans not to be accomplished. Pars Oil and gas company’s managing director who is the head in the projects of South

Iran has followed specific targets in the realm of energy since 2013 and appointing Bijan Zanganeh for retaking control of the ministry of oil was the first step to do so

Pars’ development phases called completion of the pending projects a hard task and name the situation as “industrial chaos”.In fact, allocating budget to the projects faced problems and we suffered from lack of facilities and machines. In the meanwhile, the projects fell shot to be accomplished under the negative effect of anarchy in working on the national projects in the recent era and especially in South Pars field.

170m2 Increase in Oil and Gas Extraction in South Pars Field It was the result of interest and love paired with logics and not through money solely,thatIran’s

oil minister has been asserted. Love, interest and rationalism resulted phases 17 and 18 to start to produce products after 10 years of getting operational.The development contract of these two phases was signed in 2006 and it was estimated that it will start production after 52 months. However, the project took 10 years to flow gas into the pipes and distribute it all over the country.Also, the development policies

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changed with the start of the 11th government and the work in phase 19 (equal with 2standard phases) moved forward rapidly.Policies taken by the 11th government to prioritize the projects and allocate the budgets to prioritized projects in post-sanction era played major role in producing 56.6 m2 in the phase 19. No doubt, phase 19 is the pioneer phase which proved a new and unique record through which three refinery phases started to be operational in less than six months and that is how the phase became pioneer.Phases 20 and 21also started to be operational in a way that enriched sour gas produced through these

from 285 m2 to 520 m2 in South Pars gas field in Iran in 2013 made what Qatar extracts equal with Iran after 12 years.According to the international laws, both Iran and Qatar are allowed to extract gas as much as they can and due to the sanctions and mismanagements, Qatar was ahead of Iran in this case. Iran and Qatar extracted the same amount of gas in the shared gas field in 2005 and now in 2017 the extraction of gas between these two countries became equal again. Qatar has extracted total 1771 bm2 during these years while Iran managed to extract 1060 bm2. The extraction of gas from this

projects stated that the Iranian contractors were trained in South Pars gas field which enabled them to become international. Therefore, oil ministry is to empower Iranian contractors to pave the way for them to take roles in extraction and production in oil industry.

Black Gold Extraction from Gas Capital of IranAlthough South Pars is known as the gas capital of Iran, there is a layer of oil in this field which has been extracted only by Qatar so far.However, the oil layer was exploited by Iran since March 2017 and now Iran extracts 25,000 bpd from this oil layer. To expedite the process of extracting oil in this oil layer, a separate team was formed in 2014 to mount the oil extraction as much as 35,000 bpd.Oil minister of Iran announced that Iran aims to increase oil extraction from this field to 100,000 bpd.Since Iran was behind Qatar in the realm of extraction of oil from the above-mentioned oil layer, it was decided to take advantage of floating oil refinery for the first time in the country.This is when JCPOA helped Iran to place an order for building the floating oil refinery when it was struggling with political and trading restrictions in 2013. After JCPOA, Iran could prioritize the projects through better political and trading atmosphere and one of the best decisions was to change Asian yard for building the floating refinery into Iranian shipbuilding yard. In the meanwhile, contracts to observe and improve the quality of the floating refinery and

phases is calculated to be 56m2 per day. In addition, manipulating 6 standard phases resulted in 170m2 increases in gas extraction in South Pars gas field which consequently resulted in retaking Iran’s share in gas fields from its southern neighbor and finally the ability of Iran to export gas to neighboring countries including Iraq, Oman and Afghanistan in the next step.The increase in gas extraction

gas field has created $191 billion for Iran. The other point is that getting phases into operational stage was all accomplished by Iranian contractors who played less strategic role since 1997 when South Pars gas field started to develop. Qolamreza Manuchehri, the deputy of oil and gas ministry of Iran, in regards with empowerment of these Iranian contractors in the development and engineering of South Pars

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issuing licenses with European classification societies and related companies would intensify the implementation of projects’ qualities. Higher extraction of oil from this layer helps Iran increase its total oil extraction which has been the subject of many international negotiations. In fact, a country that manages to take a leading role in oil market is the one which produces bigger amount of oil. That is why Zanganeh, the oil and gas minister of Iran, in OPEC conference stated that today oil barrels are the leading characters.

Completion of Value Chain through Taking Advantage of Petrochemical Industry Apart from the projects and plans mentioned earlier, four

petrochemical projects called Kavian2, Takhte Jamshid, Morvarid and Entekhab became operational to materialize the Iranian slogan of completion the value chain for oil and gas in Iran. Iran took the above-mentioned steps in oil and gas projects to develop exploiting hydrocarbon sources along with playing a role in the international markets and createing more revenue through petrochemical industry.In fact, petrochemical industry had proved to be able to take a bigger role in making revenue. During the sanctions, petrochemical products were the ones to improve the statistics related to non-oil exports in Iran and avoid the country’s economy to suffer more damage.Hasan Rohani, the president of

Iran, in inauguration ceremony of 4 petrochemical complexes in Assaluyeh emphasized that petrochemical activities have been planned to place within export products and stated that: Iran’s power lies in exporting.The petrochemical industry which experienced its first jump 15 years ago, is preparing itself to experience another jump through taking advantage of capital and cutting edge technology. Oil ministry also has helped this industry by announcing competitive prices for this industry’s feed and consequently encourage whether Iranian or non-Iranian investors to step in.That is how taking South Pars phases into operation promises sustainable gas feed supply for the petrochemical refineries.

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NIOC CEO, Ali Kardor:

Security of Foreign Investment Is Provided in Iran

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By:Mohammad Mohammad Zade

How much do you think Iran would gain from the implementation of this contract?According to the estimates, nearly $80 billion revenues gained from the development of Phase 11 of the South Pars Gas Field for Iran. Assuming a price of about $50 a barrel of crude oil, the value of the products harvested during the contract will reach $23 billion, and the sweet grass gas in the post-contract revenue will amount to a total of $80 billion for the country. What will be the cumulative

production of this field at the end of the 20-year period?After the 20-year period, we expect a cumulative of 335 billion cubic meters of natural gas and sour gas, about 290 million barrels of gas condensate, 14 million tons of liquid gas, 12 million tons of ethane and two million tons of sulfur. What are the other benefits of this contract for Iran?The main advantage of this contract for Iran is securing foreign investment in the country. In fact, with this contract we have paved the way for investment of

One of Iran’s most historic oil contracts was signed on July 3, 2017. The development phase of the 11th phase of the South Pars was unique by its type. The contract, in one hand, was the first Iranian foreign investment contract with an international investment company after the implementation of Joint Comprehensive Plan of Action between Iran the six Western powers; and also it was the first contract in the new contract format designed by the Iran’s Ministry of Oil called “IPC”. There were many opponents inside Iran. Opponents claim that the Total may unveil confidential information about this project or violate the terms of the contract. Also they say that Total has a poor record in Iran oil projects and they are opposing against the low share of Iranian companies in the deal.Iran oil minister has, of course, denied these claims. The senior Iranian executives in the various interviews have called these concerns “unacceptable”.Meanwhile, international companies are still afraid of presence in Iran’s economy after implementation of the JCPOA. The fears of these companies are because of American threats. With the selection of Tramp as the president of the United States, there is possibility of violate of nuclear accord. In the event of violation of the nuclear accord and sanctions imposed against Iran, the possibility of the presence of international companies in Iran will be weakened, and this can be applied to companies that have come to Iran after the event and brought their capital to Iran.Managing director of the National Iranian Oil Company, Ali Kardor, was appointed to this post after the implementation of the nuclear deal. He, who has a resume of managing the investment affairs of the National Iranian Oil Company, has worked hard to attract foreign capital to National Iranian Oil Company. In the same vein, Payam Darya Magazine had an interview with him to learn more about this contract and its details.

this message will be released to the whole world that Iran is safe for investment

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other international companies that are in doubt. When a well-known international company such as Total accepts the risk of having a 20-year presence in Iran, this message will be released to the whole world that Iran is safe for investment and other companies can safely be present in the country and the interests of both parties is also secured. Why did you sign the first deal after implementation of the Joint Comprehensive Plan of Action in Phase 11 and why was it done without bidding?Phase 11 of South Pars was the only remaining phase of the South Pars development plan. This phase has great importance to us. On one hand, this phase was located at the border with

Given the criticisms raised inside Iran, how much is Phase 11 information at risk of being unveiled?Speaking in this regard is mainly non-expert and non-professional. Total is a well-known international company. There is no background about such an issue anywhere in the world, and no country has ever made such a claim against Total. In addition, Total has completed studies for Phase 11 South Pars in 2000 and 2007 and knows the area well. For the current contract, it also conducted a study last year. So, if there were any risk, there was no need to implement the contract. Another issue is that gas flows and field patterns are well-known for Iran and Qatar, and no one can claim that he alone has such studies that are secret. On the other hand, the

Qatar, and we had to pick up Gas at this point in order to prevent gas migration. On the other hand, the South Pars project had to be completed years before, and in order to complete it ASAP, we needed a company that had the knowledge of regional conditions and does not need to perform a trial and error and quickly bring it to a conclusion. Total had already studied the area in the years 2000 and 2007 and became familiar with the conditions on the one hand and, on the other hand, it had the necessary capital to bring for the project, which made us to sign such a contract with the consortium. The time matters to us; and as do the bidding and selection of qualified companies’ take time, the choice of this consortium was the best possible solution.

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total contribution in the North Gonbad Field (the Qatar’s section of the South Pars Gas field) is very small and in fact, at the point that we are working for Phase 11, Total does not have any activity in Qatar, and there is no way to publish this information. Iranian companies had previously completed some phases in South Pars, why did not you use them to develop this phase?Petropars is a potential Iranian company in the consortium and its share of the consortium is significant. But several reasons lie behind the fact that an Iranian company has not been chosen as a consortium leader. First of all, Total is an international company. It has many experiences and is definitely preferred to other consortium’s member like Iran and even of China’s CNPC international company. Secondly, Iranian companies that have completed other phases of South Pars have been spending much time because of the sanctions and financial restrictions, and imposed more costs in the contracts on the country. For the mentioned reason, we could not accept the risk of spending more time and cost for this vital phase, and welcomed an experienced and capitalist leader to lead the consortium. Not only that Petropars is involved in this contract, but the consortium is bound by the law of “Maximization the use of productive power and service to meet the needs of the country”. That means Iranian companies must be used to provide equipments and facilities for this phase. In addition, if contractor use more Iranian companies and

equipments which is produced in Iran, concessions will be given to the contractor, which cannot be forgotten. 8 Iranian companies with the title of “E&P” companies are qualified to work with the contractor, and there are other companies that, if their qualifications are approved by the National Iranian Oil Company and the Consortium, will be used for smaller works in this contract.

Pars Field. Pressure boosting platforms are one of the known solutions to increase pressure and production. In the second part of the contract, the consortium is committed to the construction and installation of a pressure boost platform in Phase 11. This platform will be a pattern for increasing pressure in other phases of the South Pars, and for this reason, Petropars’s presence in this consortium is vital for us in order to become self-sufficient in other phases by learning how to build and install these platforms. And that means we do not need foreign companies in the future in this regard. These platforms will be built for the first time in the Middle East. Considering the presence of Iranian E&P companies in the construction of these platforms, we can also lead the other countries in the region with export this knowledge and technology, and even by having such companies, we have the ability to become rival for foreign companies in the construction of these platforms. Are environmental issues included in this contract?Of course it is. Along with the standards that are considered by the employer and the consortium for the design and construct of equipments and structures, the natural use of natural gas instead of liquid fuels can help protect the environment and prevent the spread of contamination. It is estimated by experts that the release of 21 million tonnes of carbon dioxide and 1,380 tonnes of carbon monoxide from combustion of fossil fuels in the environment is avoided.

The contract consists of two parts, the first part of which is related to phase 11. Explain more about the second part.In the South Pars, we see gas migration, and this migration will lead to a drop in pressure, which can lead to a drop in Iran’s gas output over the years. This issue led our experts to launch plans to increase pressure on the South

platforms will be built for the first time in the Middle East

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By: Foad Nabavi

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Iran’s petrochemical industry, with more than 50 years of age, is witness of its peak days and is consolidating its position on global markets as well as overtaking oil producing neighboring countries to prove that by guaranteeing the safety and supporting of domestic

Total Waiting for Entrance to Iran’s Petrochemical Gateways

and foreign investors it could be converted to an effective sinker in the industry and economy of Iran along with global markets, and take the path of growth and development.It could be definitely said that petrochemicals in the oil industry

have the highest and the most position in terms of growth, capacity expansion, prevention of crude sale, being present in global market, and attracting foreign investment, which has led to significant growth in non-oil exports of the country.

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However, what contributes to the continued growth and sustainability of the development of this industry as one of the most basic and most important industries in the world, or make the mother industry is the attraction of foreign investment.The attraction of foreign investment is of particular importance in all countries of the world. Of course, this importance in the oil, gas and petrochemical industries is of great importance, especially in oil producing countries in which Iran is included and many countries are eager to be present in this industry with regard to the maintaining of security and stability. This situation is taken into account more than ever after the implementation of JCPOA. Meanwhile, foreign investors are sitting at the negotiating table with oil executives to find investment opportunities in Iran and to provide finance for them.In this situation, the petrochemical industry has shown a special interest in the field of foreign investment, and for nearly two years, major companies such as Shell (England), Total (France), Linde (Germany), Mitsubishi (Japan), Hyosung (South Korea), Cement Stamping (Holland) and CNTIC (China) have been eager to be present and invest in Iran.Price and easy access to feedstock, historical record of petrochemical industry and the availability of appropriate infrastructure make investment attractive to the foreigners.The use of the capabilities of Iranian companies, the transfer of knowledge and technology as well as the completion of the chain of petrochemical products are one of the main conditions

for cooperation with foreign companies. In this direction, Total Co., along with other European companies, is ready to attend the Iranian petrochemical industry.Referring to the interest of large and international companies to participate in the petrochemical Industry of our country regarding the signing of a contract with Total Co., Managing director of the National Petrochemical Company in an interview with Payam Darya Magazine stated that the company would attend Iranian petrochemical industry in the case of finalization of the negotiations. On this subject and with the Ministry of Oil’s emphasis, Total will be present with the goal of completing the value chain in Iran’s petrochemical industry.Iranian Deputy Oil Minister for Petrochemical Affairs and managing director of National Iranian Petrochemical Company, Marzieh Shahdaie, underlined that the French company-Total- recently signed a deal with Iran in the upstream field and initially had to be present on the basis of the Ministry of Oil’s emphasis on completing the chain, and the finalization of the future contract in the petrochemical industry would be in the same direction.She declared that as facilitating the conditions for new investments and removing some of the barriers at the same time, European investors are interested in participating in development projects and transferring know-how of Iran’s petrochemical industry.Considering how to cooperate with foreign companies, managing director of the National Petrochemical Company added that during the entire process of negotiating with foreign

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now the situation has been much better and gradually some problems will be solved

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companies for the purpose of concluding a memorandum of understanding and contract, the three conditions for the conclusion of the contract are always emphasized.She referred to the required condition to make the contracts with foreign companies fruitful such as cooperation with Iranian companies, use of the capabilities of Iranian companies, the transfer of knowledge and technology of the day along with the completion of the petrochemical production chain.Considering the National Petrochemical Company as a policy-maker and facilitator in the petrochemical industry which aims at proposing plans to attract new investments for developing development projects, she said that during the post-JCPOA era, cooperation with foreign companies has been facilitated. Moreover, given the

development of the petrochemical industry which is dependent on international relations, facilitating banking and insurance issues have made foreign companies interested in being present in our country.Referring to the experience of companies such as Bassoff, Total, and Shell, the director of the National Petrochemical Company said that these companies have experiences and worked in the petrochemical industry while undertaking technical and economic appraisal. However, sometimes some companies that tend to invest have not been active in the petrochemical industry, and we introduce plans and Iranian partners to them. She said that all barriers and dams would not be broken at once and added: now the situation has been much better and gradually some problems will be solved. Meanwhile, European companies

and investors are ready to invest and complete the value chain in the Iranian petrochemical industry.Managing director of the National Petrochemical Company, declared: entry into the downstream and midstream petrochemicals with the caution of the principle of value added, requires technology, and we hope that the process of negotiating with foreign companies will have a positive result for the industry.Some procedures have been taken into account in the midstream industry, but the entry into midstream and downstream industries with higher value added requires technology in which, unfortunately, we have recently accessed some of them. We hope to obtain the required technologies of this sector to negotiate with the international companies.

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Iran is known for its huge reserves of oil and gas as one of the most important countries in the world which is suitable, attractive and evaluative for investment. Accordingly, lifting of the economic sanctions led Iran to be one of the goals of the world’s economic enterprises.This advantage has created optimal conditions for Iran to the extent that, it is considered attractive to create a supply chain and added value, which, with the advancement of the affiliated industries, especially in the petrochemical sector, could move towards wealth creation.In line with this, the oil and gas supply company (Tappico), one of the largest oil, gas and petrochemical complexes in the country, have attracted special attention from foreign companies.

The company, which has been able to play a significant role in the oil, gas and petrochemical industry of the country with a good production chain and for increasing investment, has been able to make optimal production as well.Consequently, we arranged an interview with CEO of Toppico to discuss the most important activities of the company. The transcription of PD’s Interview with Managing Director of Tappico is given in the following:Referring to the company as one of the country’s largest petrochemical holdings, Managing Director of Toppico said: According to a variety of portfolios, Tappico can claim that it will never suffer from any damage through the oil and gas ups and downs especially crude

oil prices mainly because we are present in all the country’s petrochemical projects and each of the complexes can create an overlap in different economic conditions. Therefore, we find that we have a complete basket of production, which means that the complete production chain is available to the Tappico. He continued: We are only not present in the oil and gas of the Persian, because of the production of this complex, which is urea, and due to the fact that we produce this product at the Technological Complex and Khorasan.Engineer Mohammad Hassan Peyvandi argued that one of the advantages of Tappico’s company is that its production complexes are not based on liquid feed and stated that: Given the fact that the country has a natural gas source

Director of TOPPICO:

The $3 billion Financing of Siraf Project by the Foreign Consortium

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and high ranking gas reserves, this strategy has always been the main focus of the oil and gas company.Managing director of Tappico stated about paying the debts of petrochemical complexes based on the price change of the gas feed rate to the National Gas Company and added: Considering that the feed rate was changed from 3 cents to 13 cents, the Special Task Force approved the bill in October. However, given the fact that the National Gas Company has put its period from April; this time difference is regarded as delayed debt which is one of the

challenges of all petrochemical complexes with the government. Therefore, companies are waiting to determine whether this debt is due to the law or not or they will be subject to the provisions of the same law in October 2013, and companies will be exempted from paying this amount.Managing Director of Tappico commented on increased productivity in hardware and software utilization and stated that: In order to increase productivity in the field of continuous hardware and increased surveillance, we are seeking to achieve more production.

Considering the output of Tappico’s performance that will grow in the year 2016, he said: Growth has been achieved since 2015 without increasing the production unit. Meanwhile we are proud to announce that no debt has been incurred by Tappico for the first time until the end of the year 95, He said that one of the most important challenges facing the company at the time of accepting responsibility was the 360,000-barrel Persian Gulf Star Refinery, which owns 49 percent of its shares and added that: This is not a huge project of corporations 150150

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project solves the problem of the sale of gas condensate because of its limited market presence in the world and is not like crude oil and on the other hand, the project will solve the gasoline problem of the country with the Euro 4 standard and diesel with Euro standard.Managing Director of Tappico said that, this year and next year, is the toughest working years of Tappico due to the Persian Gulf Star Project and stated that: owing to the severity of this project, and following the development of this site along with considering the complex totals 80% of its development, and ultimately to meet the needs of the country’s gasoline, the project is very important.He continued, two other phases of the project will be entered into the circuit with the special attention and support of the oil minister this year and next year; and it is open, of course, given that at least we need $1 billion in capital, we need state support to resolve this problem.He emphasized that we have to look at the project nationally, and presented two ways to address the investment problem of the project and said: One of these ways is to get the money for the complex with a delay of two years. It means that this is a breathtaking statement for this project; another way is considering that the food is not cheap for this complex and its marginal profit to the final product is very low. For two or three years for this particular project, instead of FOB minus 5, the FOB government will receive minus 10 from this set, in advance of this 5% discount, to meet the cost of performance and process. “Failure to set the task in this category will reduce the supply

of gas by reducing the gas supply of the company,” he said. “The result is a lack of benefit for the country, and eventually the country will suffer losses as production declines. But in general, it should be noted that the Tappico collection has no problems with feed and is at work at any cost.”Given Tappico that has a full chain of activities, even in the western pipeline, Peyvandi said that Tappico in the Gulf Complex is the country’s largest petrochemical company and has a share of 8.5% which causes the stock vulnerability to be fully preserved and not to be overlooked.Recalling his resume at the National Petrochemical Company, he called the bases of his activity as a development-oriented one and said: Accordingly, we have developed three strategic programs on the sidelines of the current programs Which include modifying the organizational structure of the company in accordance with the mission of Tappico, providing the building the appropriate company and conducting the required procedures to recruit 30 to 35 university elites in the field so that we can ensure the future of the company by transferring the experience and training of effective managers.He called the basis of development as a human resource development and added: Accordingly, the overall structure is changing in order to increase agility and productivity because we believe that it will be a good idea to take quality as a fundamental principle. “According to this concept, we put the basis of work into two

and a national setup that will meet the country’s needs.Peyvandi continued: because I believe this is a national project, not a corporation that feeds this gas condensate complex, that is, gas from the South Pars gas field; In other words, each phase of the South Pars daily produces 40,000 barrels - 25 million cubic meters of gas, and the same amount of gas condensate, so to get 25 million cubic meters of gas, you need to use 40 thousand barrels of gas condensate.He added: Accordingly, Gulf Star Project consumes 9-phase gas condensate alone. Therefore, this 151151

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elements of quality and security to make both changes in the production process and to make the workforce more attractive,” Managing director of Toppico said.He has provided the basis for performance enhancing the efficiency of existing investments and said: Unfortunately, despite the conditions in the previous

tons of production and this is the case; given the existing economic conditions, we cannot, on the pretext of optimization, adjust the human resources as privatization,” he said adding that: Therefore, we have to move towards increasing projects and high productivity in production, in order to balance the human resources.

government, many companies have had a negative financial flow but they were faced with an increase in manpower, which made it possible to put financial pressure on parent companies. “We currently have a unit in the collection, with 60,000 tons of production, with 1,480 personnel, and in return, we have a unit that has 400 staff per 1 million

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Arguing the end of the economy equals to the creation of a job, Mr. Peyvandi added that: The basis of the economy and the statement of the resistance economy is also the creation of sustainable employment; therefore, we must strive to build the job as much as possible, and it is possible to achieve this by investing and expanding.

Managing Director of Tappico called another major project of the company that will be operational by the end of the year. That is methanol project of the coral complex and said: The project, which is located in Asalouyeh with a capacity of 1 million 650 thousand tons, will be exploited and I can announce that by the end of this year, about 500,000 tons of topcoats will be added.He continued: This year, the Ilam complex with polyethylene and polypropylene products with the participation of the Persian Gulf holding will also arrive and enter the circuit, as well as prominent Kurdistan tire which will be completed this year.”Referring to the achievements of the country’s oil and gas industry, Mr. Peyvandi said: It was noted that during the last weeks, the eleventh phase with the participation of Total reached the agreement. Meanwhile, Tappico reached agreement with two Korean and Japanese companies.He added: The project has 8 refineries and 480,000 barrels of production and in the South Korean Consortium last week, an agreement on the head of the agreement (HOA) were signed, including Japan, the South Korean Hyundai and the South Korean Daelim. An EPCF Memorandum of Understanding with these three companies was signed to finance the project as well as one billion from Japan and two billion of the $ 8 billion dedicated credit line which was in fact dedicated by the President of South Korea to Iran’s cooperation with Iran which was a total of $ 3 billion in funding. Indeed, it is a huge achievement of the results.

Tappico in the Gulf Complex is the country’s largest petrochemical company and has a share of 8.5% which causes the stock vulnerability to be fully preserved

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Thanks to the Joint Comprehensive Plan of Action (JCPOA) and its execution, economic restrictions on Iran were lifted, and this has brought about constructive results for the Iranian petroleum industry. Iran’s volume of petroleum export, as the main domestic economic stimulant and the government’s basic revenue, was reduced to half in the era of sanctions; yet, after the nuclear agreement with 5+1 was reached and the JCPOA was executed in January 2015,ش Iran’s petroleum industry accompolished a remarkable success, and managed to double its export volume. To delve into this matter further, and to obtain more details regarding the current condition of Iran’s petroleum export and storage, Payam Darya Magazine conducted an interview with the managing director of Iran Oil Terminals Company (IOTC) Seyed Pirouz Moussavi. The transcript of which has been delineated in this section:

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Last year was the first post-JCPOA year, when the sanctions on Iran were lifted. Could you please elaborate on this situation, and the overall conditions of ships and their voyages?Given that lifting the sanctions, through settling down Iran’s nuclear controversy and the execution of JCPOA, was one of the most crucial strategies of the administration, IOTC was among the first corporations that paved its way and expressed its readiness in this regard. In line with this policy, and also given that increasing petroleum export which augments the nation’s revenue from this source is the main driving force behind any economic, political and social movement forward, IOTC commenced on improving

IOTC Director:

850 Tankers Have Docked at Kharg since JCPOA’s Execution

on its vulnerable spots (i.e., wharfs and berths) immediately after the 11th administration took office. After two years of relentless and professional endeavors and exactly, as planned, concurcent with the execution of JCPOA, IOTC was in possession of nine wharfs to deliver petroleum. This was a remarkable improvement compared to the past, since prior to JCPOA execution, we owned five operational and active wharfs only.Based on these measures, and in the light of an increase in our petroleum production and export, Iran managed to double the volume of its petroleum export within only six months. We are pleased to announce that currently, we are exporting crude oil double the volume we used to

We are pleased to announce that currently, we are exporting crude oil double the volume we used to export prior to JCPOA

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export prior to JCPOA. I must also point out that we served over 850 tankers in Kharg Island after the execution of JCPOA, and it was due to this large number of tankers that our export reached the foregoing amount. No doubt, the revenue from this export has had significant impact on economy and human resources behavior.

In the light of an increase in the commuting of oil tankers to Iranian wharfs, have there been any changes in the export destinations?Without a shadow of a doubt. In the era of sanctions, no foreign tankers entered Iranian waters. The only exception was the time when an explosion occurred in a Japanese power plant, and as a result of an increase in Japan’s energy needs, one Japanese tanker obtained all the licenses and traveled to Iranian waters under a certain schedule for a limited period of time. Nonetheless, for the time being and owing to the lifting of the sanctions, not only did international tankers return to Iranian waters freely and with no restrictions, but also corporations such as Total and different European countries (e.g. Spain and Belarus) led their own tankers to Iranian waters to carry their cargos.

Have you run into any issues to insure the tankers?Negative. It could be easily observed through the problem-free voyages of the ships to and from Iranian waters.

The Research Institute of Petroleum Industry (RIPI) has endeavored continuously in the field of mixing crude oils. Has

Now that Iran’s oil industry is expanding, are there any plans in place for swapping?One od the duties of oil terminals in this regard is to prepare the pipe lines and storage tankers for this matter. In the past few years, we have repaired nine tankers, and we are ready to begin swapping as soon as the national oil company launches its plans.

What will Iran’s current swapping capacity be?We will have the initial capacity of approximately 100 thousand barrels.

Now that the embargoes against Iran have been eliminated, are

this project reached any final results?Nowadays, credible oil corporations and terminals worldwide perform crude oils mixing based on the orders placed by customers and through automation and cutting-edge international standards. Hence, mixing crude oils is a fundamental international need these days. In line with this need, RIPI is finalizing its research and investigations in order to localize this technology. Extensive studies have been conducted in RIPI, and we do hope these studies reach their final outcome by the end of this year. We intend to implement this technology in Kharg Island terminal from the next year.

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you considering collaboration with other countries? We are currently using local capacities and capabilities; yet ,we are facing a number of deficits in terms of maximal storage capacity, wich we intend to solve by using foreign sources . Besides, considering the changes in the global environmental changes and climate fluctuations, we must achieve the state-of-the-art knowledge and expertise in order to be able to prevent any potential incidents.We are negotiating with a foreign company in terms of maximal storage capacity and sealing systems at present. Moreover, we have taken initiatives in the field of docks (particularly ship-

to ship and floating docks). Of course, this area is in need of more attention from and more active participation of industrial craftsmen so that it could localize the foreign technology with high standards.

What measures have taken place in the Jask region?One of the main effective measures we took in the Jask region was to obtain the official property documents for the operational lands and now, Iran’s ministry of oil is the official owner of such lands. Besides, the required studies for the development of these lands have already been conducted, but due to financial limitations, we are looking for investors to fund the launching of the projects. Hence, these projects will be constructed and implemented with 100% funding of the private sector. Our studies prognosticate that the first phase of operation will produce over 10 million barrels. We do hope to accomplish this phase via establishing a pipeline to the Jask region.

Given it is properly funded, how long does it take to complete this project?Iran’s Oil Company’s Investment Department is in the process of absorbing investors, and my colleagues are members of the final planning committee. Credible and reliable investment firms, both domestic and foreign, have expressed their willingness to fund this project, and we are finalizing probing the options. We will hopefully hold a tender in the near future and choose the final investor.

We intend to implement this technology in Kharg Island terminal from the next year

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It was quite evident for most of those involved in the field of oil affairs what the result of OPEC member oil ministers’ meeting would be ,when they were about to set off to attend this Oil Cartel session for the one hundred seventy two times . This is while everything was ambiguous in their last two meetings and the public had been expecting to see the white and hopeful results at

OPEC MembersUnited against Trump’s Oil Policy

decrease oil production if Saudi Arabia had not been flexible in changing its position against their decisions due to financial and economic problems, since OPEC members tend to make decisions collectively, not based on majority of members , and even the opposition of one member can prevent the others from achieving their ultimate common aims. Saudi Arabia , as the leading

the time they were engaged in a long trade bargaining behind closed doors. In fact provisions for an intimate meeting among these OPEC members were already made during the OPEC 170 meeting in Algiers , so the members could easily decide how to take measures for monitoring the Global Oil Market. Of course, they could never reach an agreement to

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member in OPEC sessions that was at first in favor of low prices of oil due to some political reasons such as preventing Iranian oil from returning into the market , competing against Russia in the Black Gold market along with some economic pretexts like maintaining market shares and causing impediments in the way of shale oil increase , was impelled to make a sudden decision and remain abreast of the other members of OPEC, on account of high deficit which had cropped up in its budget system. The deficit in the budget which was caused when oil prices had slumped from over $100 to below $30 drove Saudi Arabia , on some occasions , to think of modifying its economic structure and even there were some rumors going around that it intended to sell its Aramco shares . As opposed to Saudi Arabia , Iran which was once a main oil producing country had been just seeking to regain it’s previous oil market ever since the sanctions on oil sale was removed , and thus was reluctant to overlook its shares merely by the argument that oil prices might increase soon. But Russia , a non-OPEC member which owns most of the oil production in the world contributed alongside other members and managed to pave the way for reaching a historical agreement in November , as a result of which 1,800,000 barrels of oil were deducted from the global oil production altogether. However , most of the oil experts at the time thought that the agreement would be terminated completely on the date of its expiry which was to be after six months , but this never occurred and they were disappointed when the OPEC 172 meeting was

held on 25th of May. They were convinced that OPEC would no longer like to take a passive role as before in the oil market . What is the fundamental point concerning the achievement of this agreement and subsequently extending that is , though at present OPEC member countries are strongly opposed to one another in terms of political affairs , this didn’t cause the political discretions overshadow the economic interests . In fact , the decisions made during the OPEC 172 meeting were aimed at proceeding with the path their members had already started taking in the two sessions before that, and the extension of agreement for decreasing production was actually a concerted effort to keep oil prices within the rate index of $50 . Of course one could see evidently the signs of satisfaction and agreement among the members before the start of the meeting and oil producers had all announced their readiness to extend the agreement for decreasing production collectively. The members only had to argue and bargain over the terms of period and duration of the agreement . Therefore , the Oil Ministers of OPEC member countries could

OPEC non- member countries that made the decision to decrease their production to nearly 600000 barrels per day

finalize the issue within a period of less than two hours and leave the meeting heralding the good news of having extended the agreement for another 9 months . The present situation in the oil market suggests that the high reserves of crude oil which should naturally be enough to suffice the cold season are incessantly decreasing. This was what OPEC members were seeking and so it became a motive for them to

agree tacitly with the extension of the 30th of November agreement for another 9 months . The reason for extending the agreement for another nine months was to keep down the oil production through the winter season , so that when oil reserves had all been finished , there would be a balance between supply and demand of oil in the market. Also OPEC non- member countries that made the decision to decrease their production to nearly 600000 barrels per day, along with the decisions made by other members of the organization on 30th of November, will take part for extending the agreement as well. With such a situation , oil price may increase to over $55 during the cold season this year. Of course , this does not only depend on the decisions made by OPEC and US strategy can be very effective in the present situation . The increase in US oil activities is one of the main reasons which can impede oil prices boost in the oil market. Drilling in US has caused expectation for surplus of the supply in the global market to be further increased and this

would undermine the OPEC and Non-OPEC oil producers’ activities in monitoring the market. On the other hand, US has clearly announced during the past weeks that it would increase its oil activities in Alaska. Donald Trump ,the US president had already put forward the issue of releasing US strategic reserves which can be described as another reason for devaluation of oil prices following OPEC meeting . Also the issue of releasing about 345 million barrels of US strategic reserves is supposed to be brought into execution as of October 2018 for a period of 10 years. If approved by US congress and that would mean 95 thousand barrels each day from October 2018 until the year 2028 . At present , US strategic reserves stand at about 690 million barrels. On the other hand , increase in oil prices shall raise fluctuations in Shale oil market. Just as it was seen , when oil prices increased following the OPEC agreement on 30th of November , taking crude oil from Shale oil reserves adopted an increasing trend again. Thus,

Having taken these conditions into consideration, OPEC periodic president has stated that this organization is taking steps into a right path

Shale is an accomplished fact that we should believe. However, Shale oil market which has been impressed by the increase in previous oil prices and a decrease in production costs as well as

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technological improvement will continue to remain as a temporary rival for OPEC. The present situation implies that OPEC absolute achievement would depend on its production in the United States of America. Not only it has not had any participation in the agreement for decreasing production , but its production has developed about 10 per cent since the second half of the year 2016 and risen to over 9,300,000 barrels per day which is close to the level of oil production in Russia and Saudi Arabia . Although oil prices have not shown any sign of increase as yet, those involved in transacting oil as well as the analysts expect a huge amount of the oil reserving job would be diminished during the next weeks in US which can be a clear sign of the global consensus being efficient in decreasing oil production . Decrease in the level of reserving will suggest that the trend of supplying surplus of over half a billion barrels of crude oil as well as oil products into the oil market would eventually go reverse after so many years the level of reserving has been continuously

increasing . Having taken these conditions into consideration , OPEC periodic president has stated that this organization is taking steps into a right path. Saudi Arabia Energy Minister who is presently undertaking periodic presidency of OPEC organization also announced that OPEC agreement for decreasing oil production had had many considerable achievements. He believes that OPEC session on 30th of November 2016 was quite impressive and has been improving the situation in oil market astonishingly so far . He stated that the agreements have all been aimed at decreasing the level of global oil reserving to that of the average in the 5-year period and added : ‘’ We will have to make more efforts in order to achieve this main idea , notwithstanding, we are going through the right path at the present ‘’ . He said : ‘’ the market has been observing strong resolution of OPEC member and Non-member oil producing countries and this powerful will has turned to an agreement among OPEC members at the highest level of loyalty ‘’.

It seems the latest decisions by OPEC member countries at the recent session have been the best decisions they could have made considering the situation in the oil market as well as the danger Shale might have for it. It goes without saying that oil prices will be retained in the same range of 50 to 55 dollars per each barrel thanks to the recent decisions made by OPEC members , and since demand for oil will rise and reserving job will fall during the cold season , the prices will become boosted and then stabilize . This is while if OPEC had decreased production of oil once again during the recent session which was in fact aimed at increasing oil prices , though it could have made the prices slump to the range of 55 to 60 dollars per barrel for a short time, the speed in producing oil by Shale would definitely remove the effects left by such decisions within a few months. As mentioned earlier, oil producing countries’ demand for high prices gradually paved the way for their voluntary participation in an agreement in order to decrease the amount of production , and this is while even political disputes could never revoke such a firm agreement . Therefore , this can be the most significant guarantee to decrease oil production for the next 9 months. The agreement which shall help stabilize prices in the oil market if OPEC member and Non-member countries would abide by that , even if Shale oil returns into the market once again, and it would actually indicate that OPEC members have developed enough intellectually to prioritize collective interests in their decision makings.

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The European Companies Entertained in Tehran Oil Exhibition

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When Black Gold was discovered in the year 1908, the Iranians’ whole lives were changed drastically and the political, economic, cultural and social sectors on the land of Persia (Pars Land) were all overshadowed completely by the issue of Oil. Now, although it is close to 110 years since the Oil industry emerged in Iran, it has turned to be more a political and social issue, rather than being savored as an economic matter. That is why even the greatest exhibition in Iran has been devoted to oil industry, the exhibition that left its twenty second period behind this year. It was first inaugurated in 1995 with the participation of fewer than 200 exhibitors in two halls, but though it presently enjoys an area of 80,000sq/m, only one fourth of those who had previously applied to participate in the first fair can be well accommodated. So, just as oil industry which has been affected by the political situation and gone through many ups and downs during the years, the Iranian oil exhibition has not been on a fixed trend during these 22 periods as well. Actually, the exhibition had been more profitable whenever Iran’s relation was on a thriving trend with the whole world and thus the transfer of technology and capital into this country had been facilitated. Therefore , when JCPOA officially came into effect , followed by the removal of the oil embargo almost two years ago, the ground for returning of the worlds’ oil companies to Iran was prepared and the exhibition could prosper further, in such a way that the exceeding number of foreign companies to attend the exhibition caused problems for the organizers as there was

lack of space for allocating to the booths when another round of oil , gas , refining and petrochemical exhibition was about to be held. According to Ministry of Oil public relations manager ; “over 1800 domestic companies had been shortlisted

Bijan Zangeneh pointed out to the 10 main items needed in the oil sector during the inauguration ceremony

to attend the exhibition and this was while the measured areas which were required by exhibitors for their booths were over 200,000 sq/m altogether , i.e. ,nearly 4 times of the whole area of Tehran International Fair”. So the exhibition manager had to prioritize the existing spaces, and in spite of allocating the whole open areas and halls of the exhibition , no more vacant spaces could be afforded for the attendance of all 800 companies which had applied , he further added’’ .

The deployment of international oil companies to attend the Iranian oil exhibitionAs a matter of fact, Tehran oil exhibition has enjoyed quite a particular atmosphere since the eleventh administration took office and after JCPOA was formally signed by the officials. The unprecedented participation of European companies in Tehran oil exhibition raised hopes that Iran would be able to modernize oil industry through bilateral cooperation and win-win agreements. The Iranian oil industry has a great deal of potential in different sectors and with the aid of foreign investments and technologies coupled with domestic capabilities of the country is able to fully develop this lucrative industry. This was while Germany and Italy with more than 80 and 70 oil companies had the most exhibitors respectively, taking part with their renowned companies. Meanwhile, Spain, France and the Netherlands were among the other European countries whose companies had a remarkable presence at the exhibition. There is another main point 163163

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which is worth noting and that is the majority of foreign companies attending the exhibition during this period were actually participating in it for the first time. When JCPOA was enforced and sanctions were removed, a good opportunity was provided for international companies to focus on the Iranian oil market. Some of the foreign companies at the exhibition were only seeking to sell their own products, but others were more interested in transferring their own technologies and even make joint investments as well. What was quite remarkable at the Italy’s pavilion was the presence of governmental representatives of the country who had attended the fair for the first time, indicating that the Italian government supports those domestic companies which would like to take part in the Iranian Oil & Gas market. Also there were a few prestigious companies from the US who had dispatched their representatives to the International Exhibition of Iranian Oil Industry, although they lacked any booth or pavilion

Iranian companies’ capabilities in manufacturing oil –related equipment as incredible. Also, the officials of the Iranian Ministry of Oil made great efforts to bring into mind the issue of supporting domestic manufacturing more than ever before while encouraging Iranian companies to import new technologies in the field of oil through participating with some of the foreign oil firms.concurrent with that , the Iranian Oil Minister, Bijan Zangeneh pointed out to the 10 main items needed in the oil sector during the inauguration ceremony and stated: “There have been many agreements signed with domestic manufacturers, and on some occasions jointly with both the Iranian and foreign manufacturers, and we expect to sign one domestic agreement for pipes which are resistant against corrosion in near future, so Iran would become self-sufficient in importing equipment for manufacturing such pipes from abroad and be able to go into exporting in future . Of course, the agreement for manufacturing pipes which are resistant against

there. On the sidelines of this exhibition, the representatives of US corporations got acquainted closely with capabilities of the Iranian companies and negotiated with them. Even PAL US Company’s representative stated that the company had a great interest in coming into the Iranian oil market once again. This is while the Chinese massive attendance at the exhibition was quite noticeable, since they had covered a good deal of the exhibition’s area. However, it was evident that this year European companies’ attendance had clearly overshadowed Chinese participation.

The Capabilities of Iranian Companies in Manufacturing Oil-related Equipment The international oil industry exhibition was also regarded as a manifestation the capabilities of those manufacturers and experts involved in the Iranian oil industry. Although foreign companies had quite a remarkable presence at the exhibition, some of their representatives who had attended the exhibition described the

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corrosion was not signed at the exhibition, but Spanish participating manufacturers did their best to sign that within less than a week and it was eventually signed”. Zangeneh added: “the Iranian oil industry is ready for a leap forward, and as we observe today, the domestic manufacturers and contractors who are involved in the field of oil have lots of capabilities and potentials”.

Oil Exhibition, A Platform for Development of Iranian Oil CompaniesThe exhibition which was held this year was as a matter of fact the place where various agreements for developing the Iranian joint oil fields were made. The fields which are extracted by the neighboring country and Iran has to gain its own right from them as quickly as possible. In addition, Iran had announced during the previous years that it was seeking to develop the Iranian oil companies so that they would be capable of operating in developing and expanding

Oil & Gas fields. There was not a name of an Iranian company among the names of such companies which are known as E&P (Exploring & Productive) firms, but now the Ministry of Oil is seeking hard to find these eligible Iranian companies which are capable of doing such jobs through participation with foreign companies. Therefore, the National Iranian Oil Company signed an MoU (Memorandum of Understanding) for preliminary studies with Iranian corporations in order to explore oil & gas fields of small proportions during the twenty second exhibition. Evic, Idro and Mapna as well as a few others were among the companies which inked these MoUs. Due to recent openings which have developed in oil industry, the leap in the Iranian oil activities could be evidently observed in the exhibition this year. An exhibition that has turned into a place for bargaining of companies in order to offer their own products as well as grabbing a share out of the lucrative Iranian oil market.

a good opportunity was provided for international companies to focus on the Iranian oil market

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By: Sepideh Yousefi Considering the situation of Iran’s oil economy after the nuclear deal and during the Post-JCPOA era, this country is one of the main platforms for jumping to communicate with the international community. In this regard and with a proper understanding of the use of oil resources, Iran could present itself more in the region and in the world. Given this situation, Iran has come to be seen due to its single-product economy so far and in less than two years. This is the beginning of hope that country’s large-scale policy of improving oil exports and the platform created for the oil economy could strengthen other areas of the economy which need investment attraction.In the same vein and with the purpose of investigating Iran’s oil and gas capacities as well as the transition from oil-centric to gas-centric oilfields, and the establishment of a lucrative joint venture with international companies, PD managed an interview with Dr. Nersi Qorban, one of the Iranian experts in the field of energy economics in which its transcription is given as follows:

Investment Attractions in Iran’s Oil Industry

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Given the fact that gas capacity of Iran is more than it needed both in terms of household fuel inside the country and fuel feedstock, is Iran capable of creating a mainstream for foreign investment with regards to exports? Considering LPG and LNG potentials or providing the required necessities for example, how investors could enter the domestic realm of Iran as this country competes with Qatar which has access to American equipment and technology?According to the British Petroleum Statistical Review of World Energy Published in June 2016, Iran with 34 trillion cubic meters of gas reserves (18.2 percent of the world gas

reserves), possesses the largest gas reserves in the world. Iran is also the third largest producer of natural gas after the United States and Russia and the fourth largest consumer of gas after the United States, Russia and China. Iran can produce more gas considering its gas resources. If we compare Iran with the world largest gas producer we see that the United States with 5.6% of the world gas reserves produces 22% of the world gas while Iran with 18.2% of the world reserves (3.25 times US reserves) produces 5.4% of the world gas, which is less than a quarter of the US production. Consequently the potential for exporting natural gas in the form of LNG or using pipeline in the future exists.The international energy

the refinery will produce good quality naphtha that could be used for petrochemical complexes

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companies have been eager to tap Iran’s gas resources for export to East Asia and Europe since 1974. This has been delayed due to revolution in Iran, Iraqi military attack which led to eight years of war, sanctions and lack of right circumstances for investment in such venture. While Iran competes with Qatar on the development of the biggest gas field in the world (North Dome in Qatar and South Pars in Iran), it has no installation for exporting LNG and is not competing with Qatar in the export of this product.

Being the largest global reserves and considering all the profitable petrochemical complexes of the world that their needed feed is provided by liquid gas feed, is there any plan to move from oil-based to gas-based? The feedstock of most of the world upstream petrochemical complexes is Natural Gas or Naphtha. Those petrochemical producers that have access to natural gas at reasonable prices have an advantage over their competitors who are using Naphtha as feedstock. Iran, Qatar and Saudi Arabia are mostly using natural gas as feedstock

and have a competitive edge over producers who use liquid products. The move to natural gas as a feedstock has been already happened.

Petrochemical products are the largest part of our non-oil exports. Meanwhile, one of the advantages of Iran is the production of surplus gas as well as having a wide coastline in the South that is significant for petrochemical complexes with a high level of water consumption. Then, if we prepare the fields and foreign investors intend to invest, is there any planned objectives to make the petrochemical production chain complete?Iran with its large reserves of natural gas, access to relatively cheap feedstock, educated engineering and labor force and its geographical advantages could be one of the largest producers of petrochemical products. It is well known in the petrochemical trade that the real added value is created when the basic petrochemical products such as methanol and ethylene are converted to other more valuable products. Iran is currently working hard to enter into profitable joint ventures

with international companies who have access to technology and capital for developing such petrochemical complexes.

Due to the launch of the Persian Gulf Star in Bandar Abbas and West Gilan’s Pipeline, what plans have been considered for surplus capacity of South Pars aiming at the production of petrochemicals?Star of the Persian Gulf condensate refinery within a year will refine around 300,000 barrels per day of condensate produced in the South Pars gas field. Each phase of the South Pars gas production produces around 40,000 barrels of condensate per day. The conversion of condensate to light petroleum products will balance the domestic supply and demand for gasoline and there will be no need for importing gasoline from 1396. In addition to that, the refinery will produce good quality naphtha that could be used for petrochemical complexes. A number of smaller condensate refineries (60,000 barrels per day) is planned to be built in Sirraf which also produces light petroleum products for export and to be used as feedstock in domestic petrochemical complexes. 168168

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IRISL CEO:

Rising toHeyDay

IRISL CEO:

Rising toHeyDayIRISL CEO:

Rising toHeyDay

The Revival of Slik Road Passes throught the Sea

Bulletin

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IRISL, China Chamber of Commerce Sign MoU

A Memorandum of Understanding on strategic cooperation in maritime transportation was signed between Islamic Republic of Iran Shipping Line and China Chamber of Commerce.In the presence of senior managers, a Memorandum of Understanding on strategic cooperation in maritime transportation, MANA correspondent reported, was signed between Islamic Republic of Iran Shipping Line and Iran - China Chamber of Commerce and Industries in IRISL’s headquarters.Meeting the needs of merchants and providing services in the transportation sector are the major purposes of this MoU.Emphasizing on good and long-standing relationships between Iran and China, IRISL accepted the request for membership in Iran - China Chamber of Commerce and Industries.Given that IRISL possesses supply chain and offer services extensively, the cooperation between the two countries in the fields of training, fuel

preparation, bunkering, repairs and logistic could be further expanded.It is noteworthy to mention that the government has always been supportive of IRISL as well as it enjoys a remarkable condition in the capital market, owing to this, the company could take full advantage of financial facilities based on the developmental plans which have been considered by the government.In the course of this meeting, IRISL director’s senior international adviser announced that with the cooperation of Russia and Azerbaijan, Qazvin-Rasht railway as well as Rasht-Astra railway will be launched in this year.The head of international department in Iran - China Chamber of Commerce and Industries, the best producer of China industries and machinery, the best producer in the field of environment and the international secretary of Chamber of Commerce were the most prominent figures of this meeting.

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IRISL Gains Membership at B.V

Islamic Republic of Iran Shipping Line IRISL was admitted as a member in Classification Society Bureau Veritas (B.V), an event that was yet another honor accomplished after JCPOA’s executionBy official invitation of Chief Executive Officer of B.V, the director and head of the board at IRISL, Dr. Mohammad Saeedi, attended in periodical assembly of international council of classification societies, MANA correspondent reported, in the course of this assembly, this shipping company was admitted as a member in B.V. Elaborating on the capabilities and capacities of IRISL as well as exchanging ideas with owners and authorities in this assembly, Dr. Saeedi delved into the latest achievements in the field of Iranian banking relationship with international banks

particularly European banks, which have paved the way for further trade between Iran and other countries. He also added: given the undesirable condition of international shipping market, an increase in fuel costs with low sulphur as well as irrational and uneconomical limitations with regards to environmental standards, a lot of concern has been raised over the future of shipping market. It is noteworthy to mention that thanks to the execution of JCPOA, IRISL is able to be present in international decision- making councils, which is a very critical and significant event.

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In the Presence of IRISL Director:

Kazakhstan Central Railway Station Inaugurated

IRISL Bulk Division Breaks Post-JCPOA Record

In a ceremony where IRISL director and board chairman was present, the central railway station of Kazakhstan was officially inaugurated.In Kazakhstan’s capital, Astana, MANA correspondent reported, the central railway of this country and the new passenger wagons were officially launched. In this inaugural ceremony, IRISL director and chairman of the board, Dr. Mohammad Saeedi, railway senior executives and officials from Commonwealth of Independent States (CIS) countries and shipping lines were the distinguished guests. This inaugural ceremony coincided with the Expo 2017 event as well as the commencement of energy congregation in Kazakhstan. The expo 2017 has set “Energy for the Future” as its slogan this year, and it is open to public in Astana from June 10 to July 1, 2017.

IRISL Bulk Division director stated that his company has managed to sign 63 contracts with different countries for transporting grains ever since Joint Comprehensive Plan of Action (JCPOA) was executed.In an interview with MANA correspondent, Aliakbar Ghonji stated that brutal sanctions on Iran had blocked the way for the travel of Iranian ships to grain-exporting countries until 2015; yet, ever since March 2016, the circumstance changed. Emphasizing the positive impacts of JCPOA on Iran’s shipping, Ghonji asserted that IRISL Bulk Division has successfully signed 63 contracts to transport grains from various countries with bases in South America, the Black Sea, and northern Europe. According to Ghonji, 15 Panamax vessels, all owned by IRISL and decorated with Iranian flag, have been allocated to supply the transportation capacity needed by these contracts. Ever since

In this official visit, Dr. Saeedi is being accompanied by the IRISL Bulk Division director and the Khazar sea Shipping director.

March 2016, Ghonji added, approximately 3.5 million tons of grains – namely corns, soya, biomass, wheat, and rice – which means in average, 250 thousand tons of grains have been transported monthly. This is a new record in the recent years that has been set by IRISL Bulk Division.

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A Tremendous Success in Implementation of Resistance Economy:

The First Iranian Wheat Cargo Was Shipped off to Oman

Laying further emphasis on the promising impacts of JCPOA in the operational procedures of IRISL Bulk Division, Ghonji stressed that of all the merits that JCPOA brought about, some most significant ones have been creating job opportunities both directly and indirectly, moving toward the goals of resistance economy, enhancing production, sending vessels with Iranian flag to other countries which expands and promotes the mutual ties, reinvigoration of bulk-carrying vessels and hence supporting domestic industry, enhancing economic growth, and reducing costs by paying transportation rates to domestic owners.

The Director of IRISL Bulk Division stated that Iran’s first exported wheat cargo was shipped off today from Imam Khomeini Port to Oman via the Bulk Division fleet of IRISL.In an interview with MANA correspondent, Aliakbar Ghonji expressed that Iran’s plans for self-sufficient in wheat have succeeded, and now we are considering exports. The exports trend of wheat, Ghonji added, will be put in place gradually and to different destinations; and in line with this policy, the first exported wheat cargo of Iran left Imam Khomeini Port to Oman. According to Ghonji, the volume of the first exported wheat cargo was 30 thousand tons, and the IRISL Bulk Division sent out Artin Ship to transfer this cargo. Today, the embarking of this cargo was finally completed and Artin set off to Oman. IRISL Bulk Division director held these exports in very high regards, and asserted that exporting this

According to Ghonji, not paying the 10 % charges of rising other countries’ flags caused a reduction in the final price of the imported goods, reduced their inflation rates, and declined the risk of foreign vessels’ refusing to carry cargos to Iran. These are other constructive impacts of JCPOA on the operation of IRISL Bulk Division. In the end, Ghonji called the success and achievements earned by JCPOA execution a subject of pride and honor for IRISL Bulk Division, and stated that his division intends to double these achievements by using experienced experts in the two fields of marketing and operation.

cargo was a large step on the path to reach Iran’s macro-strategies, and as well, it was a leaping move forward toward executing the agendas that Iran’s supreme leader has set for 2017: Resistance economy, production and creating job opportunities. In the end, Ghonji expressed that IRISL Bulk Division is fully prepared to export all Iranian products through maritime routes.

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The Russian Astrakhan Transportation Minister:

Russia Is Ready for Expanded Collaborations in Anzali Free Zone

Government deputy chairman of Astrakhan Region announced his delegation’s readiness for investment in Anzali Free Zone and extend mutual collaborations.Astrakhan’s minister for industry, transport and natural resources, and region government deputy chairman, Radik Kharisov, paid a visit to Caspian Port in Anzali Free Zone, Guilan Province, and told MANA correspondent about Russian investors’ interest in making investments in Anzali Free Zone. The Russian delegation who have made this three-day journey to Iran’s Guilan Province, Kharisov added, have all expressed their willingness to invest, establish production enterprises and maintain closer cooperation with Anzali Free Zone.Kharisov called Anzali Free Zone a unique and proper opportunity of investment for the investors of his country.Referring to the outcomes of his delegation’s visit to Iran and meeting with Anzali Free Zone’s director and other officials, Kharisov pointed out that the visit does accelerate the collaboration enhancement

of Iran and Russia, and facilitates the entrance of private sector investors and entrepreneurs to this safe zone. Kharisov further counted paving the way for increased goods turnover as another major objective of his delegation’s visit.Regarding this visit of the Russian delegation, the secretary of Anzali Free Zone’s Investors and Entrepreneurs Association, Asghar Amani, told MANA correspondent that the development rate of this zone has accelerated at a fast pace in the past 4 years. In line with the agreements and meetings between Iran and Russia’s private sector activists, and the export of knowledge-based products to Russia, Amani added that Astrakhan and Anzali Free Zone’s customs directors have expressed their readiness to eliminate the obstacles and facilitate the trade deals of the two nations.MANA correspondent added that facilitating the services offered to merchants and economic activists as well as establishing production enterprises in ship building, packing industry and agriculture were among the most significant issues discussed in the course of the Russian delegation’s visit.

Hyundai Heavy Says Orders Have Jumped 500%

Hyundai Heavy Industries (HHI) Group says it has secured newbuilding orders for 62 vessels in the first five months of 2017, a 500% increase on ayear ago. According to MANA, The world’s largest shipbuilder said the year-to-date orders were wortha total of $3.8bn, in a statement issued on 1 June 2017. In May alone, HHI Group netted 20 ships worth $1.3bn, a figure that could increase to 29 ships worth$1.9bn if all the attached options are exercised. A spokesman for the group said the year-to-date order tally of 62 ships represents 51% of its annualorder target of $7.5bn.

He added that, according to Clarksons, the HHI Group has secured half of all VLCC orders orderedglobally so far this year with 14.

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IRISL Bulk Division Commences Transporting Project Products

Maersk IT Systems, Websites Hit in Global Cyber-attack

The Bulk Division of the Islamic Republic of Iran Shipping Line (IRISL) launched its transportation of general commodities project products.MANA correspondent reported that the transportation of general commodities project products commenced in the middle of last year through establishing regular services between Persian Gulf, the Mediterranean Sea, Europe and Far East. These services were operated via IRISL Bulk Division’s heavy-lift ships, which had the capability of carrying heavy drafts up to 500 tons.MANA correspondent also reported that on Monday, May 8th 2017, a heavy draft of 330 tons (length: 31 m, width and height: around 4.5 m), was shipped off from Bandar Abbas on the ship Baltic Harmony. This heavy draft has been the

AP Moller Maersk is among the companies hit by a massive global cyber attack.In a statement on the Danish shipowners’ website entitled “Maersk IT systems are down”, it said: “We can confirm that Maersk IT systems are down across multiple sites and business units due to a cyber attack. We continue to assess the situation,” MANA correspondent reported.“The safety of our employees, our operations and customer’s business is our top priority.”The website of its core container line business Maersk Line was down completely apart from a similar message which also apologised for any inconveniece to customers. The website of APM Terminals was also down displaying an internal error message.It is unclear what the wider impact on the group’s business operations is at this stage.The BBC was reporting a global ransomware attack, similar to last month’s Wannacry Attack,

longest as well as the heaviest heavy draft carried ever since these services commenced.

causing chaos to companies worldwide.Maersk Line launched a major push to digitise its containers shipping business and customer experience last year.

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IRISL Chairman and CEO:

Silk Road; A Supplementary Choice for Marine Transportation

In the framework of the importance of Marine Transportation in today’s trade, the chairman and CEO of IRISL, Dr. Mohammad Saeedi, attended in 28th annual session of CMF in Barcelona, 2017 called the Silk Road “A supplementary choice for Marine Transportation”.According to MANA, Dr. Saeedi, the chairman and CEO of Islamic Republic of Iran Shipping Line (IRISL) at the beginning of his presentation announced that: I receive this honor with deep gratitude to present myself here as the guest speaker to exchange the views on key issues matters in the world today, i.e. the Silk Road in a way that what it was in the past, its present situation and its significant prospect for tomorrow.Despite the existing today common general believes, he stated that: the ancient Silk Road, connecting Asia to Europe was not limited to land sector and included both the terrestrial and marine routes. This official figure added that: the marine routes and the countries it used to transit manifest themselves better, and as you would appreciate, even today, there is very little change to general directions and the paths it used to follow. Though, if we probe the matter to its core, we shall admit that the overland steppe route is considered as the ancestor to Silk Road.Referring to another high profile aspect of trade in the Silk Road, he added that: its significant role in political and economic development of the civilizations in China, Korea, Japan, and Indian subcontinent, Persia, Europe, the Horn of Africa and Arabia is worthy to be considered. Similarly, many diseases like plaque with its profound devastating effect became epidemic along the route of Silk Road which changed the lives of nations for certain segments of time. In the same vein, Dr. Saeedi made a comparison on trade volume took place between sea routes and the terrestrial routes. Considering the very early beginning that more silk and Silk Road goods reached the West via sea routes than by overland routes, they were mostly handled by the Arab, Persian and Indian ships and not the Chinese ones.Given specific and significant meaning of The Spice

Routes, IRISL CEO added that:this is the name given to Maritime Silk Roads and implies to the network of sea routes that link the East with the West.He continued: they stretch from the west coast of Japan, through the islands of Indonesia, around India to the lands of the Middle East - and from there, across the Mediterranean to Europe in a distance of over 15,000 kilometers.Considering the numerous advantages of maritime sea routes over land Silk Road that are nothing new, he referred to the traders’ main preference to carry their commodities by sea. Given the focus on present situation and Now I would like to concentrate on present situation and tomorrow’s prospect, he proposed some questions to verify the consequences of substitution in carriage of consignments from sea to land.In this regard, the first question was: Can rail road transportation, even in the case of existing most ideal optimum infrastructure and uniform advanced administration in transiting countries replace sea carriage?He referred to a surface calculation adding that in its highest optimum and ideal condition, a maximum number of 2400 TEU container would be traded between Far East to Europe by land railways. Whereas, the container volume trade between Far East – Europe in entire 2016, as per Clarksons Research is estimated to be 23.5 Million TEU, suggesting an average daily rate of 64383 TEU per day.Moreover he stated that: It is not difficult to imagine the result by adding bulk commodities and oil

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products carried in tankers to this calculation.These statistics were based on optimum condition in land rail transportation without accounting on associated delays for what is known today as the “open but blocked” challenge.Given different and non – uniform gauge systems, Dr. Saeedi added that: these systems drastically lowers efficiency and causes high operating costs. Bogie change stations limit the transport capacity of the railway and prolong the arrival time.Cost wise, we are talking about a difference of 6000 USD difference for a 20 Ft container in sea and rail transportation.Marine transportation puts the 2017 World Seaborne Trade Estimation towards 11.5 billion tones with a 3.1 percent y.o.y growth.Dr. Saeedi at the end of his presentation concluded that: the idea of Silk Road does not work as a substitution for Marine Transportation, but in future might be considered as a supplementary to that, should the infrastructure and administrative system develop enough for this purpose.The Silk Road is a comprehensive and well expanded project which shall be given the required execution in a joint venture participation of all concerned shipping companies in Far East, CIS, East and West of Europe countries.Obviously, it shall fulfill the Economic considerations, be feasible and cost wise be compatible with other alternative transportation means, as a complimentary

route in a multimodal transportation mechanism.Needless to mention the required technical infrastructure shall be provided jointly by all the countries along the route.An intelligent combination of Silk Road routes with existing strategic marine transportation routes is enough to dispel all the present challenges and convert the world to a more secure , reliable and profitable place , for all the countries.It’s worth to mention that “The Crans Montana Forum” is a Swiss Non-Governmental International Organization, first established since 1986.The yearly Crans Montana Forum meeting is a world-renowned and unavoidable event on the agenda of every decision-maker. Economic officials of the countries along with the senior directors of significant and international companies are attended in this annual forum. This annual Forum offers tailor-made partnerships and activities to those who would like to take advantage of all the opportunities offered by the wide scope, the variety and the relevance of its events.The various Forums organized worldwide (Brussels, Geneva, Rabat, Dakhla, Vienna, Crans-Montana, Bucharest, Baku, Zagreb, Roma, Sarajevo, Tirana, Athens, Malta, Bahrain etc…) represent exceptional opportunities for Businesses and Government Officials to implement their strategies, strengthen relationships with partners and create new ones, and build cooperation opportunities.

IRISL Gains Membership at Ciccps

The Islamic Republic of Iran Shipping Line became an official member of China International Chamber of Commerce for the Private Sector (CICCPS).MANA correspondent reported that IRISL’s membership at CICCPS was officially maintained in the meeting of IRISL director and his accompanying delegation with CICCPS’ secretary general.IRISL director and head of the board, Dr. Mohammad Saeedi, visited the headquarters of CICCPS in Shanghai, and sat with CICCPS secretary general, Wang Yanguo. In the course of this meeting, Dr. Saeedi stressed the importance of strengthening the mutual ties and expanding technical collaborations between the two parties.The CICCPS, which has been officially recognized by China’s Ministry of Construction, is the first technical

special chamber to offer services to Chinese private corporations, and its main objective is to facilitate economic collaborations between Chinese international companies and the international companies of other nations. Offering financial, legal, international security, and high tech services as well as establishing strong ties with Belt and Road Initiative (BRI) countries are among the top priorities of CICCPS. The CICCPS, as the only institution under the federation of Industry and Commerce, has established its ties with the Chinese government, and operates under direct management and supervision of The National Development and Reform Commission of the People’s Republic of China (NDRC) and Ministry of Commerce (MOFCOM). CICCPS is the only institution that is deemed as the product of NDRC and MOFCOM

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Every Aspect of shipping Must be Digitalized

DIGITILISATION has dominated shipping discourse in recent months, and while it will certainly bring about change and drive the industry in a new direction, it will not occur overnight.According to MANA, That was the message delivered by a panel of experts at the Lloyd’s List Oslo Business Briefing held on Monday afternoon. The panel were charged with “cutting through the digitalization hype” and providing some much-needed clarity on this hot-button topic.Stenna RoRo chief executive Per Westling said to navigate this digital journey successfully, no stone could be left unturned; every aspect of the industry must become digitalised.“And the bad news is that we have to do everything at the same time,” he said.“When you cast your mind back to when automation came to the fore in the 1980s and 1990s everyone spoke of this revolution, in which machines would take over from humans,” he said.

“But of course even 30 years on, we still have people on our vessels and manning our rigs.”“The digital transformation is upon us and the question is, who is ready to ride the wave of big data and interconnectivity, cloud-based computing, and who is ready to disrupt and who will be disrupted?“Digital information about ships and their systems is becoming more accessible, data streams are growing exponentially, automated and integrated information flows will become cost threats and data will increasingly replace experience.”Nevertheless, Mr Westling also said despite this massive potential, he was worried that some companies were taking too much notice of the digital strategies of their competitors.“I am a little bit worried about companies fearing that everyone else is doing a lot and going off and making big investments,” he said.“They might be a little bit rash when it comes to blockchain and other technologies that are important

Kandla-Bandar Abbas Shipping Line Launched

A regular shipping line was launched between the Indian Port of Kandla and the Iranian Port of Bandar Abbas.MANA correspondent reported that by the docking of the Arezoo Ship as the first vessel to go through the Kandla-Bandar Abba-Umm Qasr, this container shipping line was officially inaugurated by IRISL container company (Hafez Darya-Arya). In its first venture, this vessel loaded 607 containers and disembarked 998. Based on MANA report, Kandla Port enjoys a competitive privilege since it is connected to India’s national railway network and it has short distance from other Indian ports. Plus this, the operational costs for goods owners on this port is far less compared to other ports. Through signing the contract for the establishment of this line, IRISL founded an exclusive to the Indian Kandla Port, and hence, goods owners now have a third option added to the earlier options of Nhava Sheva and Mundra that IRISL

already covered. It should be added that, compared to the other two ports, Kandla Port has shorter distance to production and consumption services of India, and it is predicted that four Iranian ships dock at this port on a monthly basis. IRISL Container Company intends to retrieve the Iran-India-Europe lines once more, and its plans to make direct connections from India to Europe will be operational soon.

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IPMO Director:

Establishing a Direct Container Line between Chabahar and India’s Kandla Port

By establishing a direct container line between Iran’s Chabahar Port and India’s Kandla Port, the two ports are now directly connected, and hence, the time distance between the ports of the two countries has now diminished to less than two days.In order to maintain rapid and direct container transportation between the ports of India and Iran, MANA correspondent reported, the Islamic Republic of Iran Shipping Line (IRISL) has taken measures to set up direct container lines to Mundra and Kandla ports, with the collaboration of Chabahar Special Zone Organization. This direct shipping line uses two IRISL-owned ships and transports goods between these two ports. In their first ventures, according to MANA correspondent, the ships Arezzou and Yaran transported 300 containers to Kandla Port and 141 containers to Mundra Port, respectively.Thanks to the establishment of this line, merchants and goods owners could import and export their goods between the two ports in a timeline of less

than two days.It should also be added that the inauguration of this line would exert a remarkable impact on the activation of the Transit Corridor in the east of Iran as well as on the economic development of the region.

Afghanistan Demanded 37000 Tons of Sugar to be Transited from Chabahar Port

The transportation and transit deputy at Chabahar Free Zone Organization pointed out to the infrastructural development of Chabahar-Milk route and announced that the negotiations have been made for transiting 37 thousand tons of Sugar to Afghanistan through Chabahar Port.Referring to the elimination of transit restrictions in Chabahar-Milk route, Mohsen Mohammadi stated: thanks to the restoration and an increase in the capacity of Milk border, goods and commodities will be transited in the safest way and shortest time to Afghanistan, MANA correspondent reported.Announcing that for supplying its basic needs, Afghanistan demanded 37 thousand tons of sugar to be transited from Chabahar port, Mohammadi emphasized: so far, numerous negotiations have been made in this regard, the first 7000-tons sugar

cargo, he added, was transited to Afghanistan from Chabahar port in the last year.It is noteworthy that Afghanistan has shown keen interest in utilizing Chabahar -one of the largest international transit corridors- for meeting its basic needs as well as exporting goods.

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Spanish and Italian Cruise Ships Entering Persian Gulf

The head of Tourism Development and Planning Office at Cultural Heritage, Handicrafts and Tourism Organization of Iran announced that the private sector is putting its efforts to pave the way for entering Spanish and Italian Cruise ships to the Northern of Persian Gulf and docking at Iran’s southern coastline and Islands.In an interview with MANA correspondent, Abdolreza Mohajerinejad asserted that thanks to the lifting of the sanctions and the execution of JCPOA, the ground has been paved for mutual negotiations with European countries.Mohajerinejad added: in order to expanding maritime tourism, entering foreign cruise ships to the country’s coastlines has been put on the agenda.This official also remarked that negotiations over the entrance of cruise ships to Iran’s southern coasts were made with a Greek company in the International Tourism Fair in Spain-Fitur last year. Upon these negotiations and arrangements made with this Greek company, several cruises from different European destinations have been planned to enter Iranian waters.

Emphasizing that these new taken measures could make a noticeable contribution to development of maritime tourism in the Persian Gulf and Oman sea, he continued: it is hoped that with the private sector’s attempt and governmental support, we would be witnessing a boost in the country’s tourism through the entrance of foreign cruise ships.Referring to the development of Makran coast, Mohajerinejad proposed that in this macro plan, the expansion of maritime tourism has also been considered one of the main options.

IMO Announces Theme for Day of the Seafarer 2017

This year, once again, the 25th June will mark the annual Day of the Seafarer (DotS), and the International Maritime Organisation (IMO) has announced its theme of ‘Seafarers Matter’.The Day of the Seafarer was established in a resolution adopted by the 2010 Diplomatic Conference in Manila to adopt the revised STCW Convention, with the stated purpose of recognising the unique contribution made by seafarers from

all over the world to international seaborne trade, the world economy and civil society as a whole, MANA correspondent reported.The resolution ‘encourages Governments, shipping organisations, companies, shipowners and all other parties concerned to duly and appropriately promote the Day of the Seafarer and take action to celebrate it meaningfully’.

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The Greek Guide Foreign Cruise Ships toward Iran

The head of Tourism Development and Planning Office at Cultural Heritage, Handicrafts and Tourism Organization of Iran announced that Iran and Greece were negotiating over the entrance of cruise ships to Iran’s coasts in the present year.In an interview with MANA correspondent, Abdolreza Mohajerinejad stated that expanding maritime tourism is still one of the main goals of Iran’s Cultural Heritage, Handicrafts and Tourism Organization in 2017. His organization, Mohajerinejad asserted, is putting in efforts to open the southern waters and beaches of Iran to cruise ships.He pointed to a meeting held in this regard with the presence of authorities from Iran’s Port and Maritime Organization (IPMO) and stressed that IPMO was required to deliver all the facilities and equipment needed for the docking of foreign cruise ships and establishing international tours.In terms of marketing and advertisements for attracting foreign cruise ships to Iranian coasts and foreign tourists’ visiting Iranian tourists

attractions, Mohajerinejad added, we have had striking developments in this area by participating in international tourism exhibitions in different parts of the world.In line with attempts to attract foreign cruise ships, Mohajerinejad stated that negotiations over the entrance of cruise ships to Iran’s southern coasts were made with a Greek company in the International Tourism Fair in Spain-Fitur last year. Upon these negotiations and arrangements made with this Greek company, several cruises from different European destinations have been planned to enter Iranian waters. With no shred of doubt, Mohajerinejad continued, the docking of these cruise ships in Iranian coasts and the entrance of their tourists to Iran and its attractions would exert a constructive impact on Iran’s tourism industry.In the end, Mohajerinejad proposed that southern Iranian waters, particularly Qeshem and Kish Islands, possess unique and exclusive tourist attractions, which foreign tourists could enjoy visiting.

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