Since the United State pulled out of the Joint Comprehensive Plan of Action (JCPOA) in early May, the Iranian regime continues to focus on Europe, in hopes of keeping the realities of U.S. sanctions at bay. However, it seems that most European banks and companies are not willing to abide by the agreement without the U.S. They are pulling the plug on deals with Iran, in hopes of salvaging or avoiding trouble with the Trump administration.
President Trump clearly stated that the new sanctions from the U.S., in addition to the reinstatement of older sanctions, are going to be the strongest in Iranian history, while also implying that there would be severe consequences for those companies and financial institutions that attempt to do business with Iran on the side.
In Europe, the governments do not want to lose the progress made with the JCPOA, but they have to acknowledge that the power of U.S. sanctions could mean that European businesses simply wind down their projects in Iran and leave the country alone. Planned investments are simply being abandoned, as companies weigh the effect of crossing the U.S. on their businesses.
Several businesses, including Germany’s Siemens, French Oil Company Total, Danish Logistics and Transport Company Maersk, and Germany’s DZ Bank, have all either reduced their financial and business interactions with Iran or stopped dealing with the country altogether.
Essentially, companies are weighing the risk of not being able to do business with the U.S. against the high risk associated with the smaller market in Iran. For many companies, the analysis does not favor the Iranian regime. In fact, the few that have not outright pulled out are putting their agreements and plans on hold, waiting to see what the U.S. will do.
Russia and France have vowed to stay in the deal and help businesses to evade sanctions, but these companies are worried that when all the sanctions are back in place in November, they will be cut off from the bigger U.S. market.
When the JCJPOA was put into place, European banks tentatively began to build relationships with Iran, and started doing business. Iran’s economic development is about to take another blow, as the regime’s ability to tap international markets is reduced yet again.
However, it also has to be noted that the widespread corruption throughout the regime has limited the ability of the previously waived sanctions to have a greater impact on the economy. Protests throughout the country indicate that the mood of average Iranians is shifting to a change, one where the regime no longer holds sway.
In light of this, the Iranian resistance, headed by a coalition known as the National Council of Resistance of Iran (NCRI) and their allies, are meeting on June 30 for their annual Paris event. During the gathering, leaders from around the world will speak out in support of the Iranian people and their efforts to bring real change in Iran. Yes, the world will see an alternative to the regime that is crippling the Iranian economy.