Vietnam and Iran pledged yesterday to boost future trade to $2bn, as Tehran seeks to jump-start its sputtering economy after crippling international sanctions were lifted this year.
Iran’s moderate President Hassan Rouhani, in Vietnam on a three-country swing through Southeast Asia, has come under fire from conservative critics who say the nuclear deal signed with world powers has failed to bring a hoped-for economic boom.
Rouhani, who was elected on a promise to normalise relations with the outside world, praised ties with Vietnam yesterday after both sides signed several deals.
“The two sides agreed to increase bilateral trade turnover to $2bn,” the Iranian president told reporters in Hanoi.
Trade between Iran and Vietnam hit $350mn last year, according to Iran’s official IRNA news agency.
“In economics, cooperation opportunities are still large but the scale of cooperation and bilateral trade are still modest,” Vietnam’s President Tran Dai Quang said.
The landmark nuclear deal — which was reached in July 2015 and came into force in January — saw sanctions against Iran lifted in exchange for curbing Tehran’s nuclear programme, opening up one of the world’s last untapped markets for global business.
Analysts say Hanoi and Tehran, which have both had strained relations with the United States in the past, are keen to bolster alliances beyond regional diplomatic spheres.
For Rouhani, the visit marks a “turning to the East, seeing what’s there, caucusing, carving out some strong economic relations, which Iran needs,” said Vanessa Newby, international relations research fellow at ANU’s College of Asia-Pacific Affairs.
For mineral-rich Vietnam, Iran offers a key partnership in the oil and gas industry and for health and technology exchanges.
Closer ties to Iran also offers the communist nation a powerful alliance in the Middle East.
“Being under Iran’s auspices is prestigious, they’re an important country and because of the sanctions they’ve been punching way below their weight,” Newby added. “You can expect to see Iran really coming to the fore, they want a seat at the top table internationally and they’ve got the resources and frankly the workforce to get one.”
Vietnam and Iran established diplomatic relations in 1973 and two Iranian presidents have previously visited Vietnam — Mahmoud Ahmadinejad in 2012 and Akbar Hashemi Rafsanjani in 1995.
After Vietnam, Rouhani heads to Malaysia and Thailand before returning home, Iranian state media said.