More multinationals are pulling out of Iran ahead of U.S. sanctions

More and more multinational companies are pulling out of business deals and investments with Iran. U.S. President Donald Trump announced in May this year that the United States is exiting the 2015 nuclear agreement. He also announced that sanctions would be reapplied and he warned foreign companies against doing business with Iran.

Immediately after the news, several huge multinationals wound down business with Iran – clearly hesitant about getting caught up in sanctions that would affect their relationship with the United States and compromise access to the financial system.

Iran, horrified at the thought of losing further trade deals and investments, ordered the European signatories of the deal to come up with a plan that would ensure that European companies are protected from the U.S. sanctions. The fact that Iran – which is in no position to call the shots – “ordered” the Europeans to do so is beside the point.

No matter what plan the EU comes up with, nothing is going to guarantee European companies that they will be protected against the sanctions. Not only is there not enough time to draw up and implement a plan before the sanctions take effect, but the logistics are impossible. Faced with attractive business opportunities in Iran or remaining in the good books with the biggest financial power in the word … this is the choice that many have had to make. And it is not a difficult decision. The United States industrial market strength is crucial to many.

French multinational automobile manufacturer Renault has recently announced that it will be looking for new business opportunities in Africa “to offset the missed opportunities in Iran”. It has previously said that it intends to stay in Iran despite the U.S. sanctions.

At the beginning of the week, German multinational sportswear company Adidas announced that it would be leaving the Iranian market because of the upcoming U.S. sanctions. The company is following in the footsteps of American multinational Nike which pulled out of the Iranian market just before the World Cup. Nike had said: “U.S. sanctions mean that, as a U.S. company, Nike cannot supply shoes to players in the Iranian National team at this time.”

The economic pressure on the Iranian government is increasing and the country’s national currency, the rial, has it its lowest ever value against the U.S. dollar.

Instead of taking decisive action to resolve the problems, the Iranian government is blaming anything but itself. There is no responsibility and no accountability.

Furthermore, the lack of stability in the country is manifesting itself with further unrest. Protests regarding the labour situation including the low salaries paid to teachers broke out across the country earlier this week.

Protests have been ongoing since the end of December last year. There is an overwhelming desire for regime change in Iran and the people know that their situation and future will remain as it is until the regime is toppled. After almost four decades of the regime we can see that nothing will change.

Source » NCR-Iran

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