There is some huge news coming out of Iran... a Reformist Cleric named Rohani may have the inside track of being the Next President. (Story here)
ISSUE:
Lets face it, the West has issues with Iran ranging from women's rights and freedom of expression to hostile acts threatening violence and support of North Korea. But the biggest issues facing trade in and around Persia have been two-fold:
1) Shipping through the Straight of Hormuz is a tenuous proposition, with the risk of detainment, interdiction or otherwise impediment should the politics of Iran go against whatever potential flag your ocean carrier is flying.
2) Iran's Nuclear Development Program has caused international sanctions to lay down huge impediments to trade in the Persian Gulf. Shipping goods to three very affluent countries: Bahrain, U.A.E and Qatar becomes a risky proposition if Iran blocks their one free waterway access to the outside world, requiring goods to either be flown in or moved over land through Saudi Arabia or Oman (kuwait is in a similar predicament and Iraq is not a safe option given its current state of unrest).
Rohani presents a surprising good opportunity for the betterment of trade.
NITTY-GRITTY:
The Persians are generally unhappy with Mahmoud Ahmadinejad given that his hard-line stance has thrown unemployment and inflation to levels that could set the economy back decades. Fortunately (if he hadn't angered the Ayatollah last year who knows if this would still hold true), its been declared that by law Ahmadinejad is not allowed to hold the Presidency for three consecutive terms.
Iranians, though fairly free with the actually voting process, are only allowed to vote on someone who has been first cleared by the Ayatollah's election council. Based on that, I had little hope of seeing someone open to changing Iran's current headlong path towards Islamic, anti-western, radicalism and the trade barriers that would come with it (note, I have had Tehranian friends and co-workers in the past who are perfectly awesome people, and they seem to hate the way their religion and country have been used by Iranian leadership). However Rohani, from the Reformist Party, may change all that.
He is a cleric who also is a lawyer, and has acknowledged that while he supports the Ayatollah's mandate regarding nuclear program development, has spoken about the well -being of his people first.
TAKE-AWAY:
Read the article and take some solace that Rohani, if elected, could move the needle back to a more open economy with one of the region's biggest powerhouses. At the very least, we in international trade can hope that his election will allow the calculus to become algebra when it comes to shipping through the Hormuz and trading in the Gulf. He might even be able to dial back the rhetoric long enough to make trading in Iran as a Westerner a feasible (though certainly not preferential in most cases) option.
Side-note
This will have a much bigger tangential impact on a post I will be uploading later this week on the CISG and the logistics of trading goods in and out of Qatar ahead of the 2018 World Cup.
*EDIT- Rohani was just announced to have officially won the Election.
ISSUE:
Lets face it, the West has issues with Iran ranging from women's rights and freedom of expression to hostile acts threatening violence and support of North Korea. But the biggest issues facing trade in and around Persia have been two-fold:
1) Shipping through the Straight of Hormuz is a tenuous proposition, with the risk of detainment, interdiction or otherwise impediment should the politics of Iran go against whatever potential flag your ocean carrier is flying.
2) Iran's Nuclear Development Program has caused international sanctions to lay down huge impediments to trade in the Persian Gulf. Shipping goods to three very affluent countries: Bahrain, U.A.E and Qatar becomes a risky proposition if Iran blocks their one free waterway access to the outside world, requiring goods to either be flown in or moved over land through Saudi Arabia or Oman (kuwait is in a similar predicament and Iraq is not a safe option given its current state of unrest).
Rohani presents a surprising good opportunity for the betterment of trade.
NITTY-GRITTY:
The Persians are generally unhappy with Mahmoud Ahmadinejad given that his hard-line stance has thrown unemployment and inflation to levels that could set the economy back decades. Fortunately (if he hadn't angered the Ayatollah last year who knows if this would still hold true), its been declared that by law Ahmadinejad is not allowed to hold the Presidency for three consecutive terms.
Iranians, though fairly free with the actually voting process, are only allowed to vote on someone who has been first cleared by the Ayatollah's election council. Based on that, I had little hope of seeing someone open to changing Iran's current headlong path towards Islamic, anti-western, radicalism and the trade barriers that would come with it (note, I have had Tehranian friends and co-workers in the past who are perfectly awesome people, and they seem to hate the way their religion and country have been used by Iranian leadership). However Rohani, from the Reformist Party, may change all that.
He is a cleric who also is a lawyer, and has acknowledged that while he supports the Ayatollah's mandate regarding nuclear program development, has spoken about the well -being of his people first.
TAKE-AWAY:
Read the article and take some solace that Rohani, if elected, could move the needle back to a more open economy with one of the region's biggest powerhouses. At the very least, we in international trade can hope that his election will allow the calculus to become algebra when it comes to shipping through the Hormuz and trading in the Gulf. He might even be able to dial back the rhetoric long enough to make trading in Iran as a Westerner a feasible (though certainly not preferential in most cases) option.
Side-note
This will have a much bigger tangential impact on a post I will be uploading later this week on the CISG and the logistics of trading goods in and out of Qatar ahead of the 2018 World Cup.
*EDIT- Rohani was just announced to have officially won the Election.
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