Iran is planning to create a major free trade zone (FTZ) on its southwestern border areas with Iraq, reminiscent of the hugely successful Jebel Ali trade hub in the United Arab Emirates.
The Arvand FTZ covers an area of more than 37,400 hectares, including Abadan, Khorramshahr, Minoo Island and the Shalamchech border crossing to Iraq.
According to a report from the Financial Times, work began on the project last year with the help of German advisors, and is expected to be completed within two years.
Esmaeel Zamani, the managing director of the state-run Arvand Free Zone Organization told the FT:
“We hope European companies will come and visit here and see the vicinity to the Iraqi market. Insecurity [in Iraq] is not good for Iran but critical conditions there have prepared the southern Iraq market for us.”
When fully operational, industrialists and traders in the Arvand FTZ will reportedly be exempt from tax, duties, banking regulations, labor laws and visa obligations. The government hopes to prioritize oil-related industries, steel factories, power plants and renewable energy.
Akbar Torkan, a senior adviser to the Iranian president and head of Iran’s Free Trade Zones Organization, told the FT:
“Now that Iran no longer faces international sanctions, we are trying to build a bridge between Caspian Sea [in the north] and the Persian Gulf via railway which means Arvand can feed not only Iraq but also Russia.”
Already two big steel projects, including a $2-billion factory run by state-backed Jahanara in conjunction with Spain’s Sarralle Equipos Siderurgicos, have begun.
(Source: Financial Times)
(Picture: Abadan Oil Refinery)