Iran General NewsIran sees Renault deal signed by Friday

Iran sees Renault deal signed by Friday

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Reuters: Iran will sign a contract with France’s Renault by Friday to produce the no-frills Logan model in a deal Tehran hopes will revive moribund foreign investment, the industry minister said on Tuesday. TEHRAN (Reuters) – Iran will sign a contract with France’s Renault by Friday to produce the no-frills Logan model in a deal Tehran hopes will revive moribund foreign investment, the industry minister said on Tuesday.

A Renault spokesman in Tehran said an agreement had been reached and the deal should be signed in the next few days. Analysts reckon Renault’s investment will be about $2 billion (1.1 billion pounds).

Iran has been negotiating with Renault to get a 20 percent share of worldwide exports of the Logan (L90) cars built in Iranian plants. The industry and mines ministry suspended the deal until Renault accepted its terms.

“As all of Iran’s conditions have been accepted, the L90 final contract will be signed by the end of this week,” Industries and Mines Minister Alireza Tahmasbi was quoted as saying by the official IRNA news agency.

Iran’s week ends on Friday.

Analysts had warned that the suspension of the L90 project amid mounting global tension over Iran’s nuclear programme would undermine already ailing foreign investment in the country, where around 850,000 new jobs are needed every year.

“The outstanding issues with the Iranian government have been resolved and we hope to sign the new amendment to the contract in the coming days” said Alimadad Kalali, Renault’s spokesman in Tehran.

He declined to give details on whether Renault had agreed to the 20 percent export share demanded by Iran.

Renault has complained that Iran is not a member of trade pacts with neighbouring countries, meaning exports to those states would be hit hard by tariffs.

Renault already produces the Logan in Romania. It forms a key part of its strategy to boost sales in emerging markets.

The joint venture company in Iran, Renault-Pars, has signed contracts worth about 600 million euros with local firms to supply parts.

Renault has said that it plans to produce 250,000 Logan units a year in Iran as of 2008, nearly a third of its worldwide sales target of 800,000 cars by 2009.

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