The Wall Street Daily has warned in an article that US corporations are set to lose big to their European and Asian rivals once the gates to the Iranian market open in a post-sanction period.
Foreign subsidiaries of US companies may be allowed to invest in Iran. But, understandably, executives are wary of running afoul of the politicians, it said.
So, while our top companies stand on the sidelines, our competitors will eat our lunch in Iran.
Iran and the P5+1 the five permanent members of the Security Council plus Germany announced at the end of marathon top-level talks in Vienna on July 14 that they had agreed on certain restrictions over the Iranian nuclear energy activities in return for the removal of economic sanctions against the country.
The removal of the sanctions is expected to authorize foreign investments in Irans various industries among a series of other trade activities that had been banned for multiple years as a result of disputes between Iran and P5+1 over the Iranian nuclear energy program.
The Wall Street Daily added that China and Germany will specifically win from an imminent opening in trade with Iran.
It also said Irans energy sector as well as other industries will attract a significant amount of foreign investment.
Iran isnt a run-of-the-mill emerging market, the Daily said.
The country has little debt, unlike other emerging markets, and has a stock market with a market capitalization of about $110 billion. The Iranian market soared last year in anticipation of a deal [between Iran and P5+1], rising a record 130%!
The Wall Street Daily further warned that the American aerospace and automotive industries are expected to suffer the worst to their European and Asian rivals in what could eventually turn out to be a tight rivalry over the Iranian market.
Iran has one of the worlds oldest airplane fleets with an average age of 20 years. Iranian airlines have indicated that theyll be in the market for 300 or so planes over the next decade. This would be a prime opportunity for US airplane manufacturing giant Boeing, it wrote.
But the company remains hog-tied by US politicians. Instead, its likely the vast majority of those orders will go to Boeings rival, the European Airbus.
Iran is also the largest vehicle market in the Middle East, building and selling nearly one million cars last year, the Daily added.
It would be nice to see American car companies get a piece of the action. But, again, politicians will likely hold back companies until its too late to gain market share.
The Wall Street Daily further emphasized that the Iranian economy is expected to start to soar in 2016 when the sanctions will be lifted.
However, it says there will be nothing to benefit by US businesses.
The Iranian stock market will likely benefit, too, as foreign (but not American) investors will be allowed to invest there.
Everyone will be playing in Iran soon. Unfortunately, America will be sitting on the sidelines. Thanks to politicians playing politics.
By Press TV
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