German companies will have to act fast and seize the lucrative opportunities offered by the Iranian market, says Helene Rang CEO of the German Near and Middle East Association (NUMOV).
“There is especially a high demand for products made by German small and medium-sized entities,” she stressed, noting that around 80 percent of machinery and equipment in Iran is of German origin.
“NUMOV advocates closer economic ties with Iran. There is huge demand, particularly against the backdrop of a further easing of sanctions,” Rang told Deutsche Welle.
But companies don’t want to openly express their interest in engaging in business activities in Iran. Firms that have economic interests in the U.S. are particularly reluctant to endanger their ties with the authorities, explained Rang.
Before the imposition of sanctions, trade between Germany and Iran was booming. Particularly Germany’s Mittelstand (small and medium-sized companies) was selling Iran machinery and equipment used in industries such as construction, petrochemicals and mining, among others.
“German industry has in many ways went beyond the imposed sanctions and restricted their activity in Iran even further,” explained Daniel Bernbeck of the German–Iranian Chamber of Industry and Commerce (DIHK) in Tehran.
Bernbeck estimates that German exports to Iran could reach an annual volume of three to six billion euros in the short to medium term, if Iran could export oil and gas at normal rates and have access to international banking and finance.
However, many companies are working on plans to quickly enter the Iranian market once the sanctions are eased.
Germany was Iran’s second most important trading partner in 2006, according to the Tehran Chamber of Commerce (TCCIM). However, the picture looks completely different eight years later. For instance, in the last three years, exports to Iran fell by nearly 20 percent.
“The sanctions have obviously had an impact on our economy, although they have not brought the country to a standstill,” Iran’s ambassador to Germany Ali Reza Sheikh Attar told DW, pointing out that the Chinese, Russians, and Turks took advantage of the gap left by Western companies.
The U.S. is abusing the sanctions regime to gain competitive advantage in the Iranian market and counter European competition, said Ambassador Sheikh Attar.
The country that benefited most from the Western-backed sanctions against Iran is China, which has increased its exports considerably and become one of Iran’s major trading partners.
(Source: Deutsche Welle)