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September 19, 2016

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Iran calls on US to drop curbs on buying jets

IRAN urged the United States yesterday to remove remaining obstacles to Tehran buying planes following the lifting of international sanctions.

The Iranian government also spread out the welcome mat to foreign investors as it seeks to boost its aviation sector.

Iran provisionally agreed earlier this year to buy more than 200 jets worth US$50 billion at list prices from Airbus and Boeing under an agreement between Tehran and world powers to ease sanctions in exchange for curbs on Iran’s nuclear activities.

Both deals hinge on the longer-than-expected process of winning US Treasury approval, needed due to the high proportion of American parts in virtually all modern jetliners, including those made by Europe’s Airbus.

There have also been delays in getting European banks to finance the deals because of restrictions over the use of US dollars and concerns over legal risks if sanctions are reimposed.

Roads and Urban Development Minister Abbas Akhoundi told an aviation conference that Iran was complying with its obligations.

“There are a lot of obstacles but I am sure that because we have respected all the international rules and regulations, all those problems are going to be resolved,” he told the CAPA Aviation Finance Summit, the second large gathering of aviation leaders in Tehran since sanctions were lifted in January.

Critics in the US Congress argue that Iran could use passenger jets for military purposes such as transporting fighters to battle American troops or allies in Syria or transfer the aircraft to airlines still under US sanctions.

American critics of the nuclear deal also say it could allow Iran to skirt remaining sanctions by transferring jets acquired by national carrier IranAir to airlines that remain on a US blacklist, such as the country’s largest carrier, Mahan Air.

In an interview with Reuters, Akhoundi dismissed the concerns. “We have a contract. We will stick to it,” he said.

He also told a news conference that the Tehran event, attended by dozens of foreign firms, proved that aviation was international in scope and “the US government cannot stand against it.”

The House of Representatives in July passed two amendments that would stop the aircraft sales, although to become law they need to be approved by the Senate and signed by President Barack Obama.

Iran estimates it will need at least 400 aircraft to renew and expand its fleet, including some 250 in the next 10 years.


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