When Iran’s nuclear negotiations with world powers first began in 2013, hotels and restaurants in the capital Tehran were full of foreign businesspeople eager to tap an untouched market.

“In this office back in 2014 and 2015, we received a long line of what we called ‘business tourists’ who were offering us various kinds of businesses, many of them irrelevant to us and to Iran’s market,” said a manager at Griffon Capital, an asset management and private equity group. “We stopped taking meetings as it was getting crazy.”

But the nuclear deal agreed in 2015 nearly collapsed three years later when the US abandoned it and imposed sanctions that limited trade with the Islamic republic. As a result, France’s Total, Airbus, Peugeot and the US’s Boeing pulled out of billions of dollars worth of agreements.

While president-elect Joe Biden has promised to revive the deal provided Iran returns to full compliance, this time around businesses are more circumspect. With Iran reluctant to broaden the nuclear talks to include its military and regional policies, there is a lot of uncertainty.

“Investors have started approaching us, but cautiously. We are also cautious. Both sides are taking their time and are no longer daydreaming about what a nuclear deal can do,” said the head of business at Griffon Capital, who remembers the company buying back some of their foreign partners’ shares when they left. People no longer think that “Iran’s doors would open and big foreign companies would come”.

The big businesses that left in 2018 are unlikely to return quickly, according to senior western diplomats. The few that stayed but downsized will scale up if they receive a green light from the US, they said.

Some foreign entities remained and partnered with Iranian, Turkish and Emirati investors, but have since found they have not been able to repatriate their profits because of sanctions and have instead reinvested and expanded in Iran.

“The biggest problem of the companies which stayed is the difficulty of getting their money into or out of the country, while the fall of the national currency as well as losing the US market have been big punishments,” said a businessperson who deals with Iranian and European companies. “Many businesspeople have been travelling with suitcases full of cash. You can deal with this situation for some time but it is not sustainable.”

At the same time, while the world’s economy has grown, Iran’s economy has remained largely static, said a manager at Griffon Capital. “In relative terms, the strategic value of Iran’s market in 2005, for instance, was much bigger than it is today. A $1bn business in Iran was a lucrative opportunity for a big European bank years ago but now it’s possibly not worth the compliance risks,” the manager said.

Smaller foreign businesses are open to increasing trade with Iran. Last month about 100 Italian companies in the technology, machinery and banking sectors attended a webinar organised by the Italy-Iran chamber of commerce in Rome, according to one participant. “The companies showed a lot of appetite to increase or start new businesses [ in Iran],” the person said. “But the message from Italian bankers was clear: Guys, we cannot support your business unless there is an executive order by the US administration.”

With inflation at nearly 50 per cent, youth unemployment at 16.9 per cent and the rial tumbling, Iran’s economy has been hit hard by sanctions, as have western exporters, supplanted in many cases by the Chinese.

Iranian analysts, however, say pockets of the economy remain resilient and, despite recent declines, shares are buoyed by the fact that investors have nowhere else to put their money. Since 2016, Griffon capital’s fund has had a return on investment of more than 100 per cent in euros, the second manager said.

Still, the outlook is, at best, muted.

Iran’s president Hassan Rouhani said on Wednesday that he was confident his government would produce and sell more crude oil next year, a sign that he is hopeful of re-entering negotiations before he steps down next summer.

However, the Islamic republic is concerned that talks could be broadened to include regional and military issues as well as its human rights record. Iran executed Ruhollah Zam, a dissident who allegedly spied for Israel and France, on Saturday. The EU, France — where he was a resident — Canada and Germany, as well as human rights organisations condemned the killing.

“In any scenario, Iran will do better next year than it did in 2019 and 2020,” said one foreign businessman in Tehran, who has stayed in the country over the past decade. “The key for Iran will be the number of barrels of oil it can sell.”

But rather than a big return to growth if talks resume, “what seems more probable is that . . . we should not wake up in the morning with a lot of stress about new sanctions or even the possibility of a war”, the head of business at Griffon said.

“With regards to sanctions, it feels like an aggressive tumour in your body has suddenly stopped growing,” the head of business added. “This is good news but you still have that cancer in your body and you don’t know how it will behave.”