During the visit by Iranian President Mahmood Ahmadinejad in this month, Algeria and Iran have launched new opportunities of economic co-operation to boost their relationship.
The two-day trip on August 6 and 7 saw Algeria sign a series of agreements with Iran to establish direct flights between the two capitals, open up the Algerian banking sector to Iranian financial institutions - with the Iranian Development Bank to open a branch in Algiers. It was also agreed to put in place a preferential tariff system and eliminate dual taxation.
Iranian senior officials had already visited Algeria last year such as the Iranian foreign affairs minister Manouchehr Mottaki and Secretary of the Supreme National Security Council (SNSC) Ali Larijani.
Commercial exchange rate between the two countries was estimated at $20 million, according to Ali Larijani. He stressed the necessity to invest in available means in that field to reinforce economic and commercial relationships between Algeria and Iran.
In his visit to Algeria, Ali Larijani said political will between Algerian and Iranian officials existed in that regard. It just needs to be revived in different economic, political and cultural fields.
Ali Larijani believed that there are several common factors between Iran and Algeria likely to promote ties between both countries to reach a strategic level.
He added that the will of Algerian and Iranian high authorities would help to set up strong basis for friendship, solidarity and mutual understanding.
On the other hand, the Iranian presidential advisor Ali Taskhiri said Algerian-Iranian relationships were good. “There is a mutual love between the two people. There are good relationships. I believe that ties between the two countries would be prompted in economic and cultural fields.” “Algeria and Iran have a very strong will,” he told Echorouk Al Yaoumi.
Last year, the Algerian energy minister Chakib Khelil paid a visit to Iran where services were proposed to Algeria to help it in peaceful use of nuclear energy.
Algerian President Abdelaziz Bouteflika’s visit to Iran in October 2003 played a major role in the improvement of relationships between the two countries.
However, it was natural gas that grabbed most of the business headlines during Ahmadinejad’s visit. On August 8, Ghanimi Fared, the director of international affairs of National Iranian Oil Company (NIOC), announced that the Iranian firm and the Algeria’s oil and gas producer Sonatrach were in talks over a number of projects. In particular, Fared said NIOC was keen to work with the Algerian producer and gain from its experience to facilitate the export and distribution of Iranian gas in Europe and Asia.
Iran has recently signed an agreement with Ankara to pipe gas across Turkey to Europe, a market in which Algeria is already well established. Sonatrach has also expressed interest in developing part of Iran’s South Pars gas field, for both upstream and downstream operations.
The Iranian official told us the Algerian company Sonatrach and the National Iranian Oil Company (NIOC) were holding talks on several projects as part of natural gas exploitation and production in Algeria and Iran.
“Gas producers’ cartel project will be achieved sooner or later,” said Ghanemi criticising gas consumer countries that are against this project.
According to him, gas producer’ cartel is likely to guarantee the interests of producer and exporting countries.
The Iranian Energy Minister’s assistant said countries that are against gas producers’ cartel want to monopolise the global market, keep control of multinational companies and prevent national companies in producer countries from turning to hydrocarbons industry.
Energy Iranian companies are expected to cooperate with Sonatrach in petrochemistry industry.
Sonatrach is looking to assist Iran in developing its liquid natural gas (LNG) production facilities, to export gas by tanker rather than through pipelines. Iran’s LNG plants have been hindered by the US embargo and a lack of investment and advanced technology, things the Algerian firm has in abundance.
Ahmadinejad told a meeting of Algerian businessmen that the energy sector would be the basis for increased co-operation between the two countries. Calling for higher levels of Algerian investment in Iran, he said Tehran wanted to open up its economy to overseas capital. Currently, bilateral trade between the two countries runs at a paltry $7m.
Iran is determined to remove all obstacles to developing economic, trade and investment relations. We are ready to transfer Iranian expertise to Algerian businessmen, Ahmadinejad told the meeting in Algiers. Iran and Algeria enjoy remarkable capacities not only in energy, mining, agricultural and industrial fields but also in cultural and historical fields.
Ahmadinejad also called for the setting up of an international gas cartel in which Iran and Algeria would be key members, a move he said would counteract the economic hegemony of great powers.
Fared commented the forming of an international gas cartel similar to that of the OPEC, with Algeria and Iran at its heart, will be achieved sooner or later.
Hossein Abdi-Abyanah, Tehran’s ambassador to Algiers, confirmed there were major possibilities for energy co-operation between the two countries.
Our investment capacities are enormous, he told a press conference. Algerian engineers are working in the Iranian hydrocarbon sector. Sonatrach can develop projects in Iran. Iranian companies can do the same in Algeria.
One other area where Algeria and Iran may consider co-operating is far more controversial, that of nuclear energy. During Ahmadinejad’s visit President Abdelaziz Bouteflika said it was unacceptable that Iran, a signatory of the Nuclear Non-Proliferation Treaty, was being restricted in its legitimate right to acquire nuclear technology for strictly peaceful purposes.
Algeria already has two small-scale nuclear reactors for medical and experimental purposes, but said it wants to develop a nuclear energy industry within the next 10 years, a measure Iran said it would support.
Among the measures to boost trade relations, it was announced that Iran would start exporting its low cost Saipa family cars to Algeria and plans to establish a factory to manufacture vehicles in the country in the coming years. Saipa already has overseas production plants in Syria and Venezuela.
Mohsen Javan, an executive with Saipa, said exports of the cars would begin by the end of 2012, running to 20,000 units annually.
During a meeting with Speaker of the Algerian People’s National Assembly (lower house) Abdul Qadir Bin Saleh, Khatami said that the Iranians consider themselves “very close” to the Algerian people, Iran’s official IRNA news agency reported.
If the two sides adopt similar positions, it would be in the benefit of Islam, regional and world peace, Khatami stressed.
Last September, Iran and Algeria resumed the diplomatic relations, which were severed in 1993 after the North African nation accused Iran of supporting the Islamic Salvation Front, Algeria’s major opposition force.
Describing the resumption of the ties as a “bold step” meeting the interests of both sides, Khatami said that “we should safeguard the ties and plan for the future.”
He praised Algeria for making efforts in establishing and broadening Islamic civilization and called on Islamic states to put aside their differences and try to make progress through cooperation.
“We believe that the unity of Islamic states can perform miracles” and “attain a higher position in the technological, scientific, political, cultural and economic fields,” Khatami stressed.
Saleh arrived here on Tuesday to deliver a message of brotherhood, friendship and appreciation to Khatami from Algerian President Abdelaziz Bouteflika, IRNA said.
Saleh briefed Khatami on Algeria’s political and economic developments and lauded Iran’s policies both at the domestic and international levels.
Algeria and Iran share views in their general political and economic programs and has had good relations of cooperation in the oil, gas, trade and security fields, he said.
Algeria is ready to expand the ties of cooperation with Iran in all fields, he added.
Desde Alarab Online