The Canadian government has announced that it will be relaxing its economic sanctions against Iran, a move that will benefit both nations.

Iran's progress in meeting requirements imposed upon it by the UN have led Canada to lift its broad ban on financial services, imports and exports in the country, meaning Canadian companies will be better positioned to compete with other firms globally.

Applications for export permits will now be considered on a case-by-case basis, although permit applications to export sensitive items on the Export Control List will normally be denied.

Canada's government confirmed that it maintains concerns about Iran's nuclear ambitions and will therefore be keeping tight restrictions on exports of goods, services and technologies considered sensitive from a security perspective.

However, the announcement is indicative of a renewed willingness by the governments of both countries to establish a more open dialogue.

Chrystia Freeland, Canada's minister of international trade, said: "Canadian companies will now be able to position themselves for new trade opportunities, but we will also maintain rigorous controls on any exports that raise serious proliferation concerns."