The Economist Intelligence Unit estimates the consumer goods market in Iran to be worth $95 billion (Dh348.7 billion), and forecasts it to grow to $166 billion by 2020. Foods and beverages is estimated to account for just under 50 per cent of the total value, a sector that is dominated by local brands.
However, unlike the UAE, the retail structure in Iran is dominated by traditional trade, which accounts for over 90 per cent of sales value. Also, with its much larger area (19 times the size of UAE) and high population dispersion, retailers could face challenges with regard to coverage and distribution.
Local retailers are outraged. According to secretary of food wholesalers union Ali Karbasi, 30% of wholesalers in one market neighborhood in downtown Tehran have shut down and more businesses are likely to go to the wall with the opening of new foreign shops such as Turkey’s BIM.
“Hyper Star, Canbo and BIM have harmed many supermarket owners and food distributors and according to some officials, sales of local trade units in this field have dropped about 50%,” Amin Rostampour, a food distributor in Tehran province, told Jam News monitoring website.
Post-nuclear deal progress in doubt as US bellicosity triggers surge of uncertainty
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Business leaders also take solace from the fact that Iran’s $16.6bn deal for Boeing jets remains on track. Five days before Mr Trump’s inauguration, Iran was celebrating the arrival of Iran Air’s first new aircraft — an Airbus jet — in 23 years, a symbolic moment in a country desperately in need of investment.
There are no signs that French companies such as Airbus and Peugeot are under pressure to reconsider deals they reached with Iran in the wake of the nuclear agreement. However, it emerged last night that the oil company Total made its decision to invest in Iran conditional on the Trump administration’s renewal of US sanctions waivers by the summer.
Steven Daines, chief executive of new businesses at Accor Hotels, says the French group is not altering its plans to operate hotels in Iran. But on a visit to Tehran this week, he acknowledged that “we are finding it more difficult than anticipated because of concerns of instability both domestically and internationally [about investing in Iran]”.
The Trump administration has said it was “officially putting Iran on notice” in reaction to an Iranian missile test and an attack on a Saudi warship by Iranian-backed Houthi rebels in Yemen but gave no details about how Washington intended to respond.
Flynn did not specify how the new administration would respond. Asked for clarification, the White House spokesman, Sean Spicer, said the president wanted to make sure the Iranians “understood we are not going to sit by and not act on their actions”.
Before 2012, when co-ordinated western sanctions on Iran’s oil exports came into force, NITC was one of the world’s largest tanker operators with about 65 vessels. The two tankers are currently off Africa having rounded the Cape of Good Hope last week, according to satellite tanker tracking. The ‘Huge’ vessel is south west of Liberia while ‘Snow’ is off Angola. Both are expected to reach Rotterdam early next month. Nasrollah Sardashti, commercial director for NITC, said last spring that his tankers could be sailing to Europe by June, but has had to wait an additional six months for shipments to restart. “We are back in full force now to gain our markets share in tanker shipping,” Mr Sardashti told oil price agency Platts this week, which first reported the vessels’ journey.