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May 29, 2018 12:00 am | FILED UNDER: business

Trade Mission To Iran Postponed Due To US Sanctions

By ČTK Iran Czech Republic Trade

Prague, May 29 (CTK) – Industry and Trade Minister Tomas Huner will not go to Iran with representatives of Czech firms in late June since the visit has been indefinitely postponed over the development related to the American sanctions against Iran, daily Lidove noviny (LN) writes today.

 

“The Foreign Ministry did not recommend the trip to Iran on the planned date in June,” Huner told the paper.

 

“The postponement of the trip was approved after an agreement of the foreign and trade ministers with regard to the development around the U.S. sanctions against Iran,” Foreign Ministry spokeswoman Irena Valentova said.

 

the companies that export to Iran or want to invest there plunged into uncertainty following the U.S. decision to withdraw from the nuclear deal with Iran. The United States has made it clear that those who would keep trading with Iran may face sanctions. This also applies to the Czech Republic.

 

The Confederation of Industry that invited Czech firms to the planned visit to Iran eventually supported the postponement, too.

 

Martin Lukas, who heads the Confederation’s international section, said the European Commission is very likely to back Czech and EU firms but it is still unclear how the support will look like and how the negotiations will be developing.

 

“This is why we supported the postponement of the (business) mission (to Iran) by let’s say three to six months until the situation gets clear,” Lukas said.

 

Deputy Foreign Minister Martin Tlapa said there were three possible ways in which the situation between Europe and the USA in relation to the sanctions against Iran may develop.

 

First, the EU will negotiate an exemption from the American sanctions. Tlapa said statements by EC President Jean Claude Juncker indicated that the EC was trying to find a legal framework within which companies that do business with Iran would not be sanctioned.

 

But the USA seems unwilling to show understanding for the European business activities in Iran, the paper writes.

 

Shortly after U.S. President Donald Trump announced on May 8 that his country withdraws from the nuclear deal with Iran, the new U.S. ambassador to Berlin, Richard Grenell, tweeted that German companies should leave Iran as soon as possible.

 

U.S. Secretary of State Mike Pompeo threatened last week that the USA would exert an unprecedented financial pressure on Iran. The sanctions are to concern banks, oil industry, car makers and the manufacturing industry, LN writes.

 

Second, the U.S. sanctions would also apply to third parties, or companies trading with Iran as well as with the USA. This would increase the tension between America and Europe because a number of firms from Europe started investing in Iran after the sanctions were lifted in January 2016, Tlapa said.

 

This would harm firms like the Total and Shell oil companies, VW, Renault and Peugeot car makers, Airbus and Boeing aircraft producers, and Siemens industrial manufacturing company.

 

Last autumn, the Czech firm Ostroj signed a contract for the construction of a black-coal mine in Iran worth tens of millions of crowns.

 

Czech and European firms can hardly find a bank that would finance the trading with Iran these days because the USA can exert pressure on European banks. No bank in the Czech Republic is ready to finance exports to Iran and Czech exporters address Austrian, German and even Russian banks, LN writes.

 

On the other hand, Iran is calling on the EU to offer it a series of economic measures that will compensate for the U.S. withdrawal from the nuclear deal signed in 2015, including maintaining trade with European banks and continuing to buy Iranian oil. Unless this happens, Iran threatens to return to its nuclear programme, LN writes.

 

Third, the EU and the USA may agree on that Trump will negotiate with Iran about a diplomatic solution to the dispute and include in it other issues such as the Iranian ballistic missile programme and support for Syria, Tlapa said. But the U.S. demands are unacceptable for Iran and the EU has not withdrawn from the nuclear deal, he added.

 

In January 2016, Czech trade minister Jan Mladek visited Iran, accompanied by representatives of about 60 firms. The Czech business delegation to Iran, originally scheduled for June, was to be smaller, including representatives of a dozen firms, LN writes.

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