Economic relations

Iran is our 42nd customer in the world (about the same significance as Mexico and Thailand). According to the IMF, France was Iran’s seventh-leading supplier at the end of 2007, behind China, Germany, the United Arab Emirates, South Korea, Russia and Italy.

The Iranian market still accounts for approximately €2b in annual exports for our companies. For the most part, imports are hydrocarbons (97%). The bilateral trade balance shows a surplus in Iran’s favour (€900b in 2007).

French companies are reducing their exposure to Iranian risk due to the nuclear crisis and international sanctions. Between 2005 and 2007, our exports dropped considerably (-20% in value), mainly affecting professional capital goods, the automotive sector and refined products. Our imports remained stable (+2.6%). Over the same period, French banks decreased their business significantly: according to the Banque de France, total bank credit with regard to Iran dropped nearly a quarter (-22.5%). At the same time, French companies’ direct investment flows in Iran were divided by four (from €174M in 2005 to €45M in 2007). Total direct investments also fell sharply (from €638M in 2005 to €134M in 2006).

Updated on 26.12.08