Investors from the Middle East, Europe, and Asia are salivating at the prospect of breaking into the long-closed Iranian travel and tourism market. The CAPA Iran Aviation Summit is the first look for a broad base of business interests. They will have to gauge the risks that come along with Iran's foreign policy.
An aviation summit and a reported agreement for Iran to open three tourism offices in China mark Iran’s tentative steps to establish new international ties following the lifting of international sanctions in connection with the nuclear agreement with world powers.
The CAPA Iran Aviation Summit opened Sunday in Tehran. With a reported 400 delegates in attendance, including some 160 from various Iranian airport, airline, travel and transportation industries, the conference was the first business gathering of any type in Iran since the international community lifted sanctions economic sanctions.
The largest delegations in attendance by percentage, according to the Centre for Aviation, were United Arab Emirates (18%), Turkey (14%), the UK (10%), Ireland (7%), Germany (5%), and France (5%). Some 1% of the delegates were from the U.S.
Among the sponsors of the event were Travelport, Amadeus, Blue Lines Aviation Service, Avolon and Dubai Aerospace Enterprise.
CAPA states that Iran has 135 commercial aircraft and another 80 that are grounded because international sanctions eliminated Iran’s ability to get spare parts.
Iran has already notched a deal with Airbus to purchase 114 new and used aircraft from Airbus, including A320s and A340s, for national carrier Iran Air.
On the first day of the CAPA Summit Sunday, Iran’s Transport Minister Abbas Akhoondi “dangled another big order in front of Boeing,” according to Reuters.
“A stampede of investors at the CAPA Iran Aviation Summit illustrated the potential for suppliers to Iran at a time when the industry faces concerns over the global economy,” Reuters stated. “It also paved the way for a potential battle between domestic and foreign carriers to serve Iran’s markets, bolstered by tourists and investors touting for business.”
The CAPA Iran Aviation Summit kicked off a a day after Chinese President Xi Jinping met in Tehran with Iran’s Supreme Leader Ayatollah Ali Khamenei. It was the first visit to Iran by a Chinese head of state in 14 years.
Both leaders pledged closer economic and political ties, and the Tehran Times reported that Iran plans to open three tourism offices in China by the end of 2016.
Fewer than 50,000 Chinese visit Iran annually, according to the Tehran Times. Like tourism markets around the world, Iran is anxious to show off its cultural sites to Chinese tourists.
Despite the lifting of economic sanctions, the Iranian government’s involvement in the conflicts in Syria and Yemen, for example, as well as the controversy over its tests of ballistic missiles that the U.S. claimed are capable of carrying nuclear warheads, may complicate Iran’s opening to the global business community.
Those complications, though, haven’t stopped a stampede of investors from rushing in.
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Photo credit: A traffic jam in Tehran on May 5, 2007. looking4poetry / Flickr.com