China's financing terms for Iran's energy and petrochemical projects are suitable, the chairman of Iran-China Chamber of Commerce said, stressing that these pave the way for China's stronger presence in Iranian projects.
"The Chinese [offer loans to] finance petrochemical development projects with an interest rate of 6-12% ... That's a suitable rate and on a par with international standards," Asadollah Asgaroladi was also quoted as saying by NIPNA on Saturday.
Asgaroladi said that after the lifting of international economic restrictions in early 2016, the central banks of Iran and China took measures to boost financial and banking relations and ease China's investment in the country.
The official said Tehran and Beijing reached an agreement to jointly fund Iranian development projects backed by the two governments, with Chinese investors to provide 85% of funds and the rest to be sourced through the Central Bank of Iran.
"State-owned Bank of Industry and Mine and privately-run Parsian Bank handle the executive affairs of finances," he said.
He added that over the past several years, Chinese companies have played a role in Iran's petrochemical sector and presently there is a huge ground for collaboration with China in Iran's key petroleum industry.
Asgaroladi believes that China can help Iran in terms of financing and supplying equipment, "but Iran is ahead of China in terms of technical know-how".
Chinese companies have played an increasing role in Iran's quest to reform its energy and petrochemical sectors, revamp aging refining facilities and expand oil and gas transfer and export infrastructure.
Earlier this year, China's Petroleum and Chemical Corporation, also known as Sinopec, finalized a contract to expand Abadan Oil Refinery in southern Khuzestan Province.
The first phase of the project, worth $1.2 billion, is to be financed by China's Sinosure, the country's state-owned export credit agency. In September, Iran and China signed a finance deal worth $10 billion for water management, energy, environment and transport projects.
Oil and gas producer CNPC is also part of a $5-billion gas project in the Persian Gulf that sees French energy major Total as the leader, with speculations already circulating on CNPC's interest in acquiring Total's stake in the project if it opts to leave to avoid western sanctions.
Officials say China accounts for nearly 40% of Iran's petrochemical and 70% of polymer exports.
The world's biggest energy consumer is also the top customer of Iranian crude oil, ahead of India, Japan and South Korea.