Siemens CEO: We Cannot Engage in New Cooperation with Iran

Joe Kaeser, the CEO of Siemens, stated in an interview that following the U.S. withdrawal from the JCPOA and the imposition of new sanctions, the company cannot undertake new business collaborations with Iran. Siemens is a German company that operates in areas such as telecommunications and medical equipment, home appliances, various trains, and power generation equipment. In an interview with CNN on Sunday, Kaeser said, "In his view, international companies are no longer allowed to accept new orders from Iran, otherwise they may face retaliatory actions from the U.S. government." He believes that "existing contracts must be executed." Donald Trump, the U.S. President, announced on May 8 that the U.S. would withdraw from the nuclear agreement with Iran, the JCPOA, and in addition to reinstating suspended sanctions against Iran, new penalties would be imposed on Tehran. Following this decision, other parties to the nuclear agreement emphasized the continuation of the JCPOA without the U.S. Despite support from European political figures for continuing the JCPOA without the U.S., companies and economic actors in Asia and Europe collaborating with Iran are uncertain about the future of their business relations with Iran. Previously, Claudia Descalzi, the CEO of the Italian company Eni, stated that there are no plans to initiate new oil projects in Iran. According to the CEO of Eni, the only remaining contract with Iran is for the purchase of two million barrels of oil per month, which will expire this year. France and Germany are among the European countries with numerous companies operating economically in Iran and may be adversely affected by the U.S. withdrawal from the JCPOA and the uncertain future of investment and economic activity in Iran. Bruno Le Maire, the French Minister of Finance, criticized the U.S. behavior last Friday, calling it the "economic gendarme of the world" and stating that Europeans should not follow the U.S. decisions like "serfs." Le Maire also mentioned the French government's efforts to exempt French companies active in Iran, including Renault, Peugeot, Total, Sanofi (a French pharmaceutical company), and Danone (a multinational food company based in Paris), from potential penalties following U.S. sanctions. German economic officials have also reported efforts to continue cooperation of German companies in Iran. Economic and commercial activities of France and Germany in Iran, which had expanded after the signing of the nuclear agreement, saw significant growth. According to Iranian customs statistics, France's exports to Iran doubled last year, reaching 1.5 billion euros, driven by the sale of Airbus aircraft and auto parts. Additionally, Total successfully signed a contract for the development of Phase 11 of the South Pars gas field last July as part of a consortium with the China National Petroleum Corporation and Petropars Iran, valued at nearly 5 billion dollars. Germany's exports to Iran also increased by approximately 400 million euros, reaching 3 billion euros last year. Reports indicate that about 120 German companies are active in Iran with their personnel, including the large industrial group Siemens, and around 10,000 other German companies are engaged in business with Iran. Ali Majedi, Iran's ambassador to Germany, reported on Monday that Siemens is cooperating to build 10,000 megawatts of power plants in Iran. The ambassador indicated that the main obstacle to advancing these projects is banking issues for financing, which he stated would be addressed through the formation of a consortium of six German banks. Meanwhile, Siemens has stated that the delivery of three gas turbines to Iran is still ongoing, but the company's cooperation with Iran constitutes "a very small" part of its total revenue. Siemens generates about 20 billion dollars in sales annually in the U.S., which accounts for approximately 20 percent of the company's total global sales. Siemens also employs about 50,000 workers in the U.S. According to Joe Kaeser, the CEO of Siemens, the company has no choice but to comply with U.S. sanctions. Previously, John Bolton, the White House National Security Advisor, stated that European companies dealing with Iran might be targeted by sanctions. The European company Airbus also announced on Tuesday that it is analyzing the conditions and the impact of the announced sanctions on all contractual agreements with Iran. After the nuclear agreement between Iran and the P5+1 countries, several European automakers, including French automakers Peugeot-Citroën and Renault, resumed their cooperation, and the German automaker Volkswagen entered the Iranian market for the first time, leaving the fate of these automakers' contracts with Iranian partners uncertain under the new conditions. Mohammad Javad Zarif, Iran's Foreign Minister, began his periodic trips to China and Russia on Saturday and after meeting with his Russian and Chinese counterparts, he traveled to Brussels on Tuesday to discuss the future and fate of the JCPOA without the U.S. with his European counterparts from Britain, France, and Germany, as well as Federica Mogherini, the EU's foreign policy chief. Iran has stated that it will only remain committed to the JCPOA if its interests are secured in the agreement without the U.S.