Iran's rapprochement with the international community is not just a key aim of the government but an inevitability, Finance and Economy Minister Safdar Hosseini told Emerging Markets yesterday, in a rare interview.
Referring to Iran's reintegration into the international economy, especially through increased economic cooperation with Europe and elsewhere, Hosseini points out that such ties are at their strongest for years, and that they fit the pattern of an ever more integrated global economy.
"The world economy is a live entity. And the Iranian economy is in active interaction with neighbouring countries," he says, adding that foreign investment will be the cornerstone of Iran's future economic progress. "Only two weeks ago I received a proposal from a European consortium for $15 billion in investment."
The strengthening ties come as a welcome counterweight to heightening tensions with the international community, especially the US, over the suspicion that the Islamic Republic is secretly seeking nuclear arms.
Tension with the US reached a new high on Friday when Iranian Foreign Minister Kamal Kharrazi told the UN General Assembly that "the attack against Iraq was illegal," and accused the US of "lawless militarism" in Iraq.
Despite continued US sanctions on Iran - which some experts suggest is an economic war with no historical parallel other than in World War II Germany - the country has managed phenomenal growth rates in recent years, hitting 6.7% in 2004 spurred in part by massive oil windfalls. Iran is the world's fourth biggest oil producer.
"There is a possibility that sanctions have an impact in the short term, but not in the long run. The economy is now very global," Hosseini says. "We do not expect sanctions to be a big deal."
One senior Iranian official says: "The pressure on Iran will continue, but the country has been forced to rely on itself. So it has become a lot less vulnerable to outside shocks. It has been resilient to threats and manipulations."
Already this year the government has received applications for $8.2 billion in foreign investment, $4.5 billion of which has been approved in the past five months. This compares to $8.6 billion of foreign investment made in Iran since 1997.