Economy, Domestic Economy

Germany’s VDMA to Open Tehran Office

Germany’s VDMA to Open Tehran OfficeGermany’s VDMA to Open Tehran Office

German engineering trade group VDMA said it planned to open an office in Tehran in the first half of 2016 to help companies sell machinery.

“Embargo products are very specific products. Our members make cement, for instance. We could sell that to Iran. And in some cases, we do,” VDMA President Reinhold Festge told a news conference on Thursday, Reuters reported.

The VDMA, which represents large engineering companies such as Siemens and also thousands of medium-sized industrial goods makers, said it was telling its members to be prepared for all scenarios and to be ready to step up their business with Iran from the first quarter of 2016.

Germany exported machinery worth about €630 million ($683 million) to Iran last year, accounting for about 13% of all international machinery exports to the country.

The VDMA estimates that figure could have been at least €100 million higher if German machinery makers’ trade with Iran had not been hampered by uncertainty, an unfamiliarity with the exact trade restrictions and problems related to financing.

Once western sanctions against Iran are lifted, the VDMA expects German companies’ machinery exports could rise to around €1.6 billion in the medium term.

“But we warn against euphoria. This will be a gradual process,” VDMA’s Festge said.

Total machinery exports from Germany were worth about €151.5 billion last year.