NCRI Staff
NCRI – South Korea recently stopped a proposed investment $1.6 billion deal with the Iranian Regime, thanks to Saudi Arabia’s influence.
The Financial Tribune reported on Tuesday that the deal between a South Korean engineering firm and the Iranian steel industry was stopped in its tracks, thanks to two Saudi board members who raised concerns about the dangers of working with the Regime.
The agreement signed between South Korea’s POSCO Engineering & Construction and Iranian steelmaker Pars Kohan Diar Parsian Steel (PKP) in May 2016, would have meant POSCO building a steel mill in Iran’s Chabahar Free Trade-Industrial Zone.
In a POSCO announcement, it was mentioned that one of the reasons that the two Saudi board members were reluctant to approve the investment was because of fraught political relations between the Iranian Regime and Saudi Arabia.
The announcement read: “As relations between Iran and Saudi Arabia rapidly grew worse after a severance of diplomatic ties … outside directors in the board meeting are having negative stances on Iran projects….[As such, POSCO is having difficulty] “convincing and reaching consent on the unfavourable opinion from the outside directors.”
In 2015, POSCO had sold a 38% stake in its E&C division to Saudi Arabia’s Public Investment Fund for $1.1 billion, which gave the fund the right to appoint two board members.
This is a landmark moment for those who fully see the dangers of investing in the Iranian Regime and proves that companies can walk away from such deals.
When the 2015 nuclear deal was signed, it was supposed to waive nuclear sanctions and increase trade between Iran and the global community. However, there are some major problems with this.
First of all, many of the larger international banks are nervous about approving such investments because of the very real danger that the nuclear deal could collapse if the US pulls out and the investment would be lost.
Secondly, and way more importantly, the money invested in Iran is very unlikely to help the Iranian people. The Regime and its security forces control the majority of the economy and thus benefit from the trade deals, but rather than use the money for things like healthcare or education, they are using it to fund terrorism and war in the Middle East and to suppress their own people, as you can see from the current protests.
An investment in Iran is dangerous for the business and for the world, so more businesses should refuse to trade with the Iranian Regime.