With the lifting of sanctions, Iran rejoins the international community. It is the most significant return to the stage of a key state since the end of the Cold War.
United Nations (UN) experts have certified that the Iranian government has fulfilled all its obligations under the nuclear agreement signed in July.
The report from the International Atomic Energy Agency (IAEA) gives the green light to the implementation of the nuclear agreement with Tehran. According to IAEA Director General Yukiya Amano, "Iran has implemented all measures necessary to enable Implementation Day to proceed, in accordance with the agreement."
The lifting of sanctions follows the agreement on Tehran's controversial nuclear programme, concluded on 14 July 2015 with the 5+1 Group: the United States, Russia, France, China, Great Britain (the countries holding veto rights at the UN) plus Germany.
The historic decision was announced at a joint press conference in Vienna by European diplomacy chief Federica Mogherini alongside Iranian Foreign Minister Javad Zarif, with John Kerry in attendance.
Iran has been subject to international economic sanctions since 1979, when they were introduced following the Khomeinist revolution, and subsequently renewed over the following decades in the wake of human rights violations and the country's ambitions to develop nuclear weapons technology.
The text includes guarantees to prevent Iran from acquiring nuclear weapons, in exchange for the lifting of the severe international sanctions adopted by the UN Security Council, including the freezing of assets belonging to individuals and companies linked to the nuclear enrichment programme. Iran has also pledged greater transparency regarding its nuclear programme, allowing United Nations inspectors to monitor it. The process has proved faster than analysts had anticipated.
Iran cannot wait to begin selling its crude oil freely again. The lifting of international sanctions will allow Tehran to recover more than 100 billion frozen abroad and to throw open its doors to the oil, financial and commercial markets. Without sanctions, a new economic season begins. But that is not all.
"After the nuclear agreement enters into force, the ground is fertile for greater cooperation at the regional level to fight the real danger threatening our region, namely terrorism and extremism," said Iranian Minister Zarif, referring in particular to Isis militias.
The Iranian financial system has remained isolated from the rest of the world, and oil exports — the country's primary resource, which holds the third-largest reserves in Opec after Venezuela and Saudi Arabia — have been curtailed. As most of the sanctions will be lifted within days, if not hours, Iran is counting on being able to export an additional half a million barrels of oil per day in the near term. Roughly 10 per cent of global oil reserves lie beneath Iranian soil, and the Iranians have already stated that they are capable of increasing crude production — today down to 2.7 million barrels per day from 3.6 million in 2011, before the sanctions, and from 4 million in 2008 — within a matter of weeks. There are 13 supertankers already laden with crude and ready to set sail.
The news sent the markets of Dubai, Qatar, Abu Dhabi and Saudi Arabia into the red. The reason behind the recent chain of falls on the Gulf states' stock exchanges is that the end of sanctions could allow Iran to suddenly increase its crude exports. But the global market is already grappling with an oversupply.
Barrel prices have fallen to levels so low as to be unsustainable for the vast majority of shale oil producers in the United States. There, extraction costs remain too high to withstand oil below 30 dollars: today they average 47 dollars per barrel, according to a recent Wells Fargo study. The drastic decision by Bhp Billiton, which yesterday wrote down its American shale assets by 7.2 billion dollars, may signal that the American fracking industry is collapsing.
Beyond oil, the car, rail and aircraft markets also hold appeal for Western companies. To obtain products from abroad and circumvent the trade blockade, Iranians resorted extensively to smuggling. In 2014 alone, illegal imports are estimated to have amounted to 25 billion dollars (against a legal import market of around 60 billion dollars!). China and Russia were the main suppliers. As a legacy of this period, there is a vehicle fleet of around 14 million cars in need of renewal. Iran was a market of 1.5 million vehicle registrations per year in the pre-tightening-of-sanctions period up to 2011; it is now expected to return above 2 million units per year. Here, however, French manufacturers Peugeot-Citroën and Renault are already at the forefront.
As regards aircraft, it has been announced that, with sanctions lifted, fleet renewal will begin with the purchase of 400 planes, and the purchase of 114 aircraft from European manufacturer Airbus is already planned. Similar discussions will follow for trains and railways.
In this entire chessboard of moves yet to come, Italy does not stand out in any field, for the moment, except one: food. With the lifting of sanctions, exports of Italian agri-food products to Iran could double over the next three years, reaching 40 million euros by 2018. The estimate comes from Coldiretti and Nomisma. Eighty per cent of Italian agri-food exports to Iran today consist of processed products, while the remaining 20 per cent comprises agricultural products. In detail – Coldiretti specifies – olive oil is the main item in the made-in-Italy agri-food sector on the Iranian market, accounting for 15 per cent of total sector exports. Other Italian products purchased – Coldiretti continues – are animal feed (13 per cent), vegetable seeds (12 per cent), other types of vegetable oils (10 per cent), confectionery (6 per cent), vinegars (4 per cent), while for now, strangely, the role of pasta exports is marginal, worth just over 100,000 euros. But, more generally, the removal of sanctions will bring an improvement in Iran's economic conditions, which has a direct impact on food consumption, where it is easy to foresee growth in sales of imported food products over the coming years. A justified expectation – Coldiretti argues – given the growing appeal that western lifestyles hold for Iranian consumers, especially among the middle class and young people.