Will European Companies Give in to Us Pressures Against the Iran Regime?
By Staff Writer
Following the 2015 Iran nuclear deal, many European countries began investing in Iran. Being threatened by new US sanctions, most of these companies are now going to succumb to US pressures.
The United States is going to impose ‘the strongest sanctions in history’ on the Iranian regime, as put by US Secretary of State Mike Pompeo. The threat would imply that all companies and financial institutions that have entered into ‘forbidden business’ with the Iranian regime will also have to pay the consequences.
European politics and economy are the two areas that are beginning to take US threats seriously. Many European companies have currently either significantly reduced their economic interactions with Iran or stopped it altogether. This means that their planned investments in Iran won’t be going into effect.
The most distinguished instances in this regard are Germany’s Siemens, French Oil Company Total, Danish Logistics and Transport Company Maersk, and Germany’s DZ Bank, a central institution for more than 1,000 co-operative banks.
Jose Campus Nave is a CEO in Nurnberg-based Rodl and Partner Company and also an Iran expert. Campus Nave points to the effects US sanctions would have on German car manufacturers, among others, saying “each company should weigh up the situation for itself to determine which trade is more important: the big trade with the United States that’s currently underway, or a small one with Iran that’s also subject to a high risk.”
German companies have invested more than $110 billion in the United States, while their investment in Iran has been only $3 billion.
According to Campus Nave, mid-sized companies are going to lose all they’ve already invested in Iran. “A solar park, for instance, can’t be dismantled. Besides, many of these mid-range companies have also trade relations with the United States,” says Campus Nave, adding “so, these companies have to declare their investment in Iran as a loss.”
The process is currently underway. Speaking on condition of anonymity, the CEO of a company in southwestern Germany says “we made a lot of investments in Iran over the past couple of years, amounting to millions of Euros. Now, however, we have to declare it as a loss.”
European political figures are now trying to find out which types of future economic trades with the Iranian regime would be unproblematic. And on the other hand, they also want to discuss the interpretation of sanctions with their American counterparts.
Jose Campus Nave from Nurnberg-based economic consultant group believes that US sanctions could deliver a major blow to European banks, which have already been shocked since the United States decided to pull out of the JCPOA. Financial institutions currently involved in investing in Iran are now faced with the risk of losing their license in the United States or having to pay heavy fines.
Funding the German companies’ currently active projects in Iran is also at risk. No one is willing to take the risk of doing business with Iran. “Any company that dares to do this could be forced to pay restitution.”
When Iran sanctions were lifted two years ago, European banks credulously and trustfully entered into business with the Iranian regime. Today, however, they should expect to be sanctioned if they continue their operation in the country.
Iran economic expert Campus Nave says that Iran’s development process will be seriously hit should the United States succeed to fully implement its sanctions against the country, since the flow of technology-transfer to Iran streamlined from early 2017 will be stopped, meaning that modern and efficient technologies would no longer be transferred to Iran. This would particularly affect Iran’s energy, car manufacturing and infrastructures areas, causing the country to go back to previous outdated tools and techniques.