President Jacob Zuma arrived in Iran on Sunday to strengthen political, trade and investment ties with the country after international sanctions against the Islamic Republic were lifted earlier this year.
South Africa is planning to exploit a market ready for investment as tens of billions of dollars worth of Iranian assets will now be unfrozen and global companies that have been barred from doing business there will benefit.
Although the two countries have reportedly signed eight agreements on collaboration in areas which include trade, industries, investments, agriculture, water resources and oil industry research and development, no details of the agreements were given.
The two countries have also called for strengthening intelligence collaboration in the fight against terrorism.
Zuma said in his opening remarks after his arrival that various mechanisms had been discussed “to strengthen our political, trade, investment and economic, as well as people-to-people relations between our countries.
“The lifting of nuclear-related sanctions against Iran provides immense potential for closer commercial and investment cooperation between South Africa and Iran.”
Iranian President Hassan Rouhani said in his speech that South Africa had supported Iran during its time under sanctions.
“Today, after the nuclear accords and the end of sanctions against Iran, there is a sharp competition between Asian and European countries for cooperation agreements with Iran, but we will never forget our close friends from the era of sanctions,” Rouhani said, referring to South Africa.
Pretoria is planning to build an oil refinery that will process Iranian crude to boost its petrol supply and reduce its reliance on foreign companies.
Iran also has been discouraged that few trade deals have been implemented since the sanctions were lifted in exchange for restrains on its nuclear program, as foreign banks still steer clear of processing transactions
It will be recalled that on April 15 Iran called on the United States and European Union to help it access the global financial system, but the White House declined that the nuclear deal did not include giving Tehran such access.