EU leaders are keen to salvage the deal shaped by Obama's administration after President Trump on May 12th pulled the US out of the Joint Comprehensive Plan of Action (JCPOA). The deal, in which Iran committed to denuclearize in exchange for the lifting of economic sanctions, was signed by Iran, the US and the international community in 2015.
German Chancellor Angela Merkel, French President Emmanuel Macron and a spate of other EU leaders have held emergency meetings to try and save the JCPOA, arguing that companies should be able to make their own decisions about whether to trade with Iranian entities – many of which are linked to religious foundations and political institutions in the Islamic Republic of Iran.
“This agreement is everything other than ideal, but Iran is, according to all the knowledge of the international nuclear authorities, sticking to the commitments of the agreement,” said Chancellor Merkel last week, reports Reuters.
Last week, Merkel met Russian President Vladimir Putin, putting recent differences aside, in a bid to recruit global support to save the deal.
Iranian Foreign Minister Jawad Sharif said the EU's desire to save the deal however is not enough. Sharif told the Iranian state news agency that the EU must take practical steps to "increase its investment in Iran," reports Munich-based daily Süddeutsche Zeitung.
Germany is one of Iran's most important EU trade partners, according to a report in German online news site ZDF, although Germany exports in 2016 to Iran accounted for less than €4 billion.
German car giant Daimler and chemical and consumer goods company Henkel could both be affected by the US sanctions, add the ZDF report.
The difference of ideas on how to deal with Iran was highlighted by the new US ambassador to Berlin, who angered German media with one his first tweets in the job.
As @realDonaldTrump said, US sanctions will target critical sectors of Irans economy. German companies doing business in Iran should wind down operations immediately.
— Richard Grenell (@RichardGrenell) May 8, 2018
Wolfgang Ischinger, a former German ambassador to the US from 1998 to 2001, replied that Germany was unlikely to respond to the US' bullish tone.
Ric: my advice, after a long ambassadorial career: explain your own countrys policies, and lobby the host country – but never tell the host country what to do, if you want to stay out of trouble. Germans are eager to listen, but they will resent instructions.
— Wolfgang Ischinger (@ischinger) May 9, 2018
The US' reimposition of sanctions leaves European companies doing business in Iran sitting on a wobbly fence. French oil giant Total has apparently suspended a €4,8 billion investment in Iran's petrochemical sector until the company is assured of a sanctions waiver by the US State Department, adds Süddeutsche Zeitung's report.
Late last week the EU Commission President Jean-Claude Juncker said an EU law from the 1990s could be employed to castigate EU firms that comply with US sanctions on Iran, according to news portal Zeit Online.
The EU has its own sanctions on trade of several goods with Iran.