Iran reaches deal to purchase 100 Boeing planes

US government still needs to approve $17 billion contract to update Iranian passenger jet fleet

An Iran Air Boeing 747 passenger plane sitting on the tarmac of the domestic Mehrabad airport in the Iranian capital Tehran, January 15, 2013. (AFP/Behrouz Mehri)
An Iran Air Boeing 747 passenger plane sitting on the tarmac of the domestic Mehrabad airport in the Iranian capital Tehran, January 15, 2013. (AFP/Behrouz Mehri)

TEHRAN, Iran — Iran said Sunday it has reached an agreement with American aerospace giant Boeing to purchase 100 aircraft to renew its aging fleet, though the deal must still be approved by the US government.

The Islamic Republic has ordered about 200 planes from three Western manufacturers since mid-January, when economic sanctions were lifted following a deal on Tehran’s nuclear program.

Ali Abedzadeh, head of Iran’s civil aviation authority, said in remarks published by the daily Iran newspaper that an agreement had been reached with Boeing for the purchase but said the deal was contingent on US Treasury permission.

Deputy Transport Minister Asghar Fakhrieh Kashan, however, said Sunday that he hoped the initial accord could be completed within a month.

He told the Fars news agency that the deal would be “the largest and most important contract” with the United States — barring military deals — since before Iran’s 1979 Islamic Revolution.

A nuclear agreement in July with six world powers, including the US, has lifted some of the economic sanctions on Iran in return for limits on the Islamic Republic’s controversial atomic program.

Many of Iran’s aging civil aviation fleet — 230 planes out of 250 according to Abedzadeh — are in desperate need of replacement.

Boeing has fallen behind the race to restock Iran because as an American company it has to obtain the green light from the US Office of Foreign Assets Control before completing any contracts with Iran.

It has requested final authorization for the sale, according to Abedzadeh.

He said the contract’s reported value of $17 billion (15 billion euros) was not final and that more details will be provided after further negotiations.

Boeing confirmed on Wednesday that it was in talks with Iranian airlines interested in buying its passenger planes.

“We have been engaged in discussions with Iranian airlines approved by the (US government) about potential purchases of Boeing commercial passenger airplanes and services,” the company said in an email to AFP.

In February, the American company was granted approval from the US government to explore resuming sales to Iran after sanctions were partially lifted in January.

No diplomatic ties

Iran and the US broke diplomatic ties in 1980 following a hostage crisis at the American embassy in Tehran.

Ayatollah Ruhollah Khomeini, the father of modern Iran, dubbed the US the “Great Satan” and his successor, supreme leader Ayatollah Ali Khamenei, has kept Tehran on a stridently anti-American path.

Despite allowing nuclear negotiations with Washington, Khamenei has repeatedly warned of American and Western “infiltration” in the post-sanctions era.

Although the nuclear deal lifted most economic sanctions, the US and the European Union have kept up some measures due to Tehran’s support for groups such as Lebanon’s Hezbollah, as well as its ballistic missile program.

This means major international banks, particularly in Europe, are still reluctant to do business with Iran for fear of punitive US measures.

Iran in January reached a memorandum of understanding with European aircraft manufacturer Airbus for the purchase of 118 planes.

That agreement is also still pending permission from the US Treasury, since more than 10 percent of Airbus components are of American origin.

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