CHINA is financing billions of dollars worth of Chinese-led projects in Iran, making deep inroads into the economy while European competitors struggle to find banks willing to fund their ambitions, Iranian government and industry officials said.

Freed from crippling nuclear sanctions two years ago, Iran is drawing unprecedented Chinese funding for everything from railways to hospitals, they said. State-owned investment arm CITIC Group recently established a US$10 billion credit line and China Development Bank is considering US$15 billion more.

“They (Western firms) had better come quickly to Iran otherwise China will take over,” said Ferial Mostofi, head of the Iran Chamber of Commerce’s investment commission, speaking on the sidelines of an Iran-Italy investment meeting in Rome.

The Chinese funding, by far the largest statement of investment intent of any country for Iran, is in stark contrast with the drought facing Western investors since U.S. President Donald Trump disavowed the 2015 pact agreed by major powers, raising the threat sanctions could be reimposed.

Iranian officials say the deals are part of China’s US$124 billion Belt and Road Initiative, which aims to build new infrastructure — from highways and railways to ports and power plants — between China and Europe to pave the way for an expansion of trade.

Iranian media reports have said the CITIC credit line, which was agreed upon in September, would include water management, energy, environment and transport projects.

An Iranian central bank source said loans under the credit line would be primarily extended in euros and yuan.

The China Development Bank signed a memorandum of understanding for US$15 billion, Iranian state news agency IRNA said Sept. 15.

With a population of 80 million and a large, sophisticated middle class, Iran has the potential to be a regional economic powerhouse.

A few European banks have deepened trade ties with Iran this year. Austria’s Oberbank inked a financing deal with Iran in September.

South Korea has also proved a willing investor, with Seoul’s Eximbank signing an 8 billion euros credit line for projects in Iran in August, according to Xinhua.(SD-Agencies)