Invest KOREA

According to Yonhap News,

(TEHRAN/SEOUL=Yonhap News) South Korea and Iran signed a total of 66 memorandums of understanding (MOUs) on Monday, paving the way for Seoul to win business deals on infrastructure building and energy exploration from Tehran.

After their summit held in Tehran earlier in the day, President Park Geun-hye and Iranian President Hassan Rouhani observed the signings, which senior presidential secretary for economic affairs An Chong-bum described as "an opportunity for South Korea to stay ahead of the game in the Iranian market." The deals could lay the foundation for creating "the second Middle East boom" for Asia's fourth largest economy.

The presidential office said those MOUs effectively gave local companies an edge in infra-building construction orders worth US$37.1 billion, and the figure could eventually go up to $45.6 billion given follow-up deals that can be signed down the road.

The deals could result in $12.1 billion worth of infrastructure construction like road, railway and water resource facilities as well as $31.6 billion worth in orders to rebuild the energy sector, according to the presidential office Cheong Wa Dae.

They also cover $1.9 billion worth of health-related orders to build six hospitals and build up an industrial zone for medical goods.

Seoul plans to provide $25 billion in loans to support South Korean contracts related to the bilateral deals.

On the occasion of Park's visit to Tehran, the two countries also signed a shipping accord, which they had to put off for the past 20 years since Iran's proposal in 1996, due to international sanctions on the resource-rich country.

The pact allows the countries' vessels to move more freely between each other's harbors and lifts restrictions on money transfers between the shipping lines of the two nations.

Among the agreements reached on Monday were Seoul and Tehran's joint understanding to set up a euro-based payment system for the settlement of accounts as well as the introduction of direct flights between the countries.

South Korea's biggest air carrier Korean Air Lines Co. is planning to service the non-stop flights linking South Korea to Iran by the end of this year, following up on the transport ministry's approval of the air route in March, according to company officials.

pbr@yna.co.kr

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