Domestic Economy

Export Guarantee Row “Almost Solved”

Export Guarantee  Row “Almost Solved”Export Guarantee  Row “Almost Solved”

Iran expects a row with Germany over unpaid state export guarantees to be resolved soon.

Iranian Minister of Industries, Mining and Trade Mohammad Reza Nematzadeh was quoted as making the statement in a German newspaper on Thursday, a step that would remove a big hurdle to reviving trade relations.

Iran owes Germany about €500 million ($570 million) under the so-called Hermes covers, a German government arrangement that protects German companies if foreign debtors fail to pay.

Nematzadeh told Germany’s Handelsblatt newspaper in an interview that there were only a few small problems left to be resolved, Reuters reported.

“After my meeting with Economy Minister Sigmar Gabriel, it looks like the last problems will be able to be solved quickly,” Nematzadeh said.

He added that he expected that Gabriel, who was forced to cancel a trip to Iran last month due to illness, would now head to Tehran in October. “By then we hope that all remaining problems will be solved,” he said.

A spokesman for Germany’s Economy Ministry said talks with Iran were still ongoing, but Berlin was optimistic that the government could soon offer fresh state export guarantees to companies that plan to do business with Iran.

German industry has been hoping for a surge in exports to Iran after western sanctions were lifted in January in return for Iran complying with a deal to limit its nuclear program.

Nematzadeh said big German firms, including Volkswagen, Daimler, Siemens, Linde, BASF and Airbus, were already in negotiations about doing business in Iran.

He added that Iran was interested in long-term cooperation with Germany and would prioritize projects in the transport, oil and gas, mining and food industries.

“Projects that included the necessary financing would be given precedence,” he said

  Iran-EU Trade Center in Berlin

Nematzadeh inaugurated the Iran-EU Trade, Economic and Industry Center in Berlin last week.

“The opening of this center could be a good start for Iran and Germany to revive their ties, as we used to have good relations in the past,” Mehr News Agency quoted the minister as saying at the inauguration, in which some 100 business players from both countries participated.

“We hope this center will bring the companies of the two countries closer,” he added, referring to machinery manufacturing and banking among sectors where Iran and Germany could enhance ties.

The center is located at the headquarters of German Near and Middle East Association, which is the oldest and largest non-profit and independent service provider for the Near and Middle East region.

“Iran is ready to have its major companies open representative offices in the trade center,” Mehdi Karbasian, Nematzadeh’s deputy and head of Iran Mines and Mining Industries Development and Renovation Organization, was quoted as saying during the ceremony.

Iran’s Ambassador to Germany Ali Majedi, who was also on hand, said the inauguration has created “a good atmosphere” for deepening relations between Iran and European countries, particularly Germany.

“Germany is likely to become Iran’s top trading partner in three to four years,” he said.

Iran-Germany trade stood at $7-8 billion before western sanctions were imposed on Iran over its nuclear program, according to Nematzadeh.

Bilateral trade declined as a result of sanctions, falling to €2.4 billion ($2.6 billion) in 2014.

With the easing of banking obstacles created by the US and the launch of automotive deals with top German automakers like Mercedes Benz, bilateral transactions could easily grow tenfold in a year.

Nematzadeh arrived in Berlin June 30 to meet Germany’s Vice Chancellor and Economy Minister Sigmar Gabriel and former chancellor, Gerhard Schroeder, as well as several top executives of German corporations.