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Trade with Iran falls silent

Minister of Foreign Affairs Reynders on mission in Tehran in 2015.

The export of Belgian products to Iran drops since the beginning of this year, after five years of strong growth. That trend coincides with the U.s. sanctions against Tehran. Starting today, there are U.s. sanctions against companies that remain active in Iran.

In the first four months of this year, the Belgian exports to Iran 13 percent lower than in the same period of last year. This decrease is remarkable, because in the past five years our exports to Iran, with sharp jumps up, from eur 240 million in 2013 to nearly 600 million last year (see graph).

Especially for the Flemish industry – original equipment manufacturers and the pharmaceutical sector-to header was Iran an attractive market has become after the western countries in 2015 their trade embargo had been lifted. They did that after the shutdown of a nuclear agreement with Iran.

But the political situation has completely changed since the American president Donald Trump last spring that agreement unilaterally terminated. As of today, there are U.s. sanctions in force against all of the companies that remain active in Iran. With the handelsboycot wants to Trump the government in Tehran to renegotiations force about its nuclear program.

European tegenplan

The European Union is not agree with that policy and the commission-Juncker tries to the impact of the boycott on the European economy to ward off a ‘tegenplan’. So can European companies a compensation claim if they losses suffer by the boycott. The aircraft manufacturer Airbus seems to be the biggest victim as an Iranian order of 98 aircraft would not continue.

At the same time, a European ban to join the American boycott, except with the consent of the Commission. Violators can be fined, but the will of the national governments depend on, or that penalties really.

The European tegenplan seems to be mainly on paper in a fist. On the site have quite a few European multinationals, all eggs for their money and chosen their line with Iran broken or at least on hold , for fear of retaliation on their American subsidiaries. More car manufacturer Renault and the oil company Total in this case.

Soudal connect office

Also in our country there are companies that the certain for the uncertain. Thus, Soudal, the successful silicon – and lijmproducent from Turnhout, recently decided to have its sales office in Tehran to close.

Soudal saw, however, a lot of potential in the Iranian market, says marketing director Luc Thys. “We were there on a trading mission, and last year a private verkoopsfiliaal founded. But we also have a production plant in the U.s. state of Kentucky. And that is for us much more important.’

At Reynaers Aluminium is the activity in Iran to almost zero avail, says managing director Martine Reynaers. “The market is much too unstable to do business. Foreign companies can no bank to do more.’

For some companies, it offers the boycott unsuspected opportunities. For Punch Powertrain, for example, the Limburg, a manufacturer of transmissions. “We have quite a few Chinese companies as clients,’ says managing director Gert-Jan Vogelaar. ‘If the French carmakers Peugeot and Renault left and the Chinese on the Iranian automotive market to take over, it would be us that stand out.’

The Flemish handelsagentschap FIT keeps his office in Tehran open. ‘To all Flemish companies that trade would be with Iran, with council and deed.”

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