France May Reach Iran Trade Deals in Weeks, Ex-Envoy Says

French auto and aviation companies visiting Iran may start shipping parts there within weeks, as they explore deals potentially worth hundreds of millions of dollars, a former French ambassador to the country said.

“Initial agreements may be reached, if not in coming days then maybe within the next few weeks,” Francois Nicoullaud, France’s ambassador to Tehran from 2001 to 2005, said by phone from Paris yesterday. “Within weeks it will be possible to see the start of supplies.”

France is looking to resume trade ties following an interim accord between world powers and Iran that allows sanctions relief in some sectors in return for curbs on Iran’s nuclear program. Talks resuming in Vienna on Feb. 18 will explore whether the sides can reach a comprehensive deal to ensure Iran’s nuclear program is non-military, as it says, and end international sanctions against it.

The French have been in the vanguard of efforts to move back into the Iranian market, and a trade delegation of more than 100 businesspeople is visiting Iran this week. The overtures have sparked concern in the U.S., where Under Secretary of State for Political Affairs Wendy Sherman told the Senate Foreign Relations Committee yesterday that the Persian Gulf country isn’t yet “open for business.”

‘Test the Waters’

The French delegation primarily aims “to test the waters,” said Nicoullaud, who met with some of its members prior to their trip. “All large companies that used to work with Iran” as well as small ones are present, he said.

Delegation members represent industries including energy, construction, aviation, electronics, automotive, food and cosmetics, Nicoullaud said. While he declined to identify any, Iran’s state-run Mehr News agency said before the visit that the group included GDF Suez SA, France’s former natural-gas monopoly, and Total SA, Europe’s third-largest oil company.

Iran Air Chairman Farhad Parvaresh said this week that foreign manufacturers are waiting for U.S. Treasury permission to ship plane parts to Iranian airlines.

In December, Gilles Normand, chairman of Renault SA’s Asia-Pacific region, said the French automaker was “waiting for the go-ahead” to resume the export of car parts to Iran.

French carmakers sold more cars in Iran, a market of almost 80 million, than European competitors before sanctions took effect. Their share of Iran’s market has dropped from 40 percent to less than 25 percent, Mehdi Mir Abutaebli, deputy chief of Iran’s Trade Promotion Organization, was quoted today as saying in the Donya-e-Eqtesad newspaper.

Before it's here, it's on the Bloomberg Terminal.