Iran says to hold trade talks with UAE govt team

The United States has been pressing companies and governments to cut ties with Iran, which Washington says is seeking to build atomic weapons. Iran denies this and has urged foreign firms and capitals to ignore the US pressure.

US sanctions on Iranian banks have made it tougher for Iranians to do business, prompting some to set up offices in the regional trading hub of Dubai to circumvent restrictions. Many other Iranian firms have operated in Dubai for years.

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Shia Muslim Iran has been seeking to boost ties with its Arab neighbours and Mahmoud Ahmadinejad in December became its first president to attend a summit of the Gulf Cooperation Council, made up of six mostly Sunni Muslim states.

His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, will head a delegation including UAE Foreign Minister Shaikh Abdullah bin Zayed Al Nahayan to Iran on Monday, Iran's Foreign Ministry said.

'Talks will be held on economic relations, investment, transfer of electricity, exportation of gas. Ways and means will be explored for boosting the volume of trade between the two countries,' ministry spokesman Mohammad Ali Hosseini said.

Hosseini's comments were made at a news conference broadcast and translated by Iran's English-language Press TV.

Many goods are re-exported from Dubai to Iran. In addition, Iran and Crescent Petroleum, a shareholder in UAE energy firm Dana Gas, have been negotiating a deal for the supply of Iranian gas to the UAE. Talks have been held up by a price row.

The UAE, which like Iran is a big oil producer in the Organisation of the Petroleum Exporting Countries, needs gas to fuel rapidly rising consumption by industry and power plants.

Iran sits on the world's second largest gas reserves, but has been slow to develop exports, which analysts blame partly on US sanctions that have restricted access to technology.

Despite a history of trading ties, the two Gulf states have a long-running dispute over sovereignty over three Gulf islands-Abu Musa and the Greater and Lesser Tunbs.

Asked about that row, Hosseini said: 'We have on various occasions voiced our preparedness for holding face-to-face talks on the issue within the framework of bilateral relations.'