British-Iranian Economic Relations (1945-1988)

Abstract

The economic relations between the two countries became tense in 1979 after the Iranian demonstrators detained the US embassy employees. Britain took a hard line in 1980 towards the Iranian government, despite the latter's declaration of its keenness to establish economic and political relations with Britain. But the latter adhered to the decision taken by the Arab countries to boycott Iranian oil and not sell it the weapons or equipment it needed in its war that broke out in 1980 with Iraq, which made Iran deplete its foreign currency balances and disrupt its civil industrial projects. Britain maintained an office for its interests at the Swedish embassy in Tehran. . British flights returned to Tehran in 1981, and attempts were made to restore economic relations between the two countries, which culminated in several deals.