German firms aim for better business ties to Iran | Germany| News and in-depth reporting from Berlin and beyond | DW | 27.11.2013
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German firms aim for better business ties to Iran

Now that the West has reached an interim agreement on Iran's nuclear program, many German companies are hoping sanctions will be eased. They look forward to reviving a traditionally good economic relationship.

When he thinks of Iran as Germany's once and future trading partner, Volker Treier can't help but be enthusiastic.

"Iran not only has many raw materials, many of which have not been made accessible yet, but it also has a long trading history with Germany," the head of international trade at the Association of German Chambers of Commerce and Industry (DIHK) told DW.

"In addition, Iran also has an industry structure and experience in the manufacturing of industrial products," Treier said, adding that these are the reasons he thinks Germany is almost guaranteed to benefit from a revived trading relationship with Iran.

Of course, the trade volume between the two countries is still quite modest - last year it was less than 3 billion euros ($4.1 billion). Should the sanctions against Iran be lifted, the first step would be to reestablish a system for financial transactions. Ever since sanctions were imposed, European banks have almost completely withdrawn from Iran. "Trade must be backed with money," said Treier. "Money is the lifeblood of economic activity."

Volker Treier

Treier says there's a long tradition of trade between Iran and Germany

''A drop in the bucket'

Daniel Bernbeck, executive director of the German–Iranian Chamber of Industry and Commerce in Tehran, also thinks the virtual non-existence of monetary transactions is "the most debilitating effect of sanctions, because it has a direct impact on trade."

Bernbeck has noticed that Iranian businesses are showing an increased interest in obtaining information on Germany, though he added that it's too early to get excited. "So far, only small transactions have been made," he said. "If you consider that Iran once had more than $100 billion in oil and gas exports per year, then $4 billion over six months is a drop in the bucket."

In the long term, France and Germany are the countries with the greatest prospects for a profitable business relationship with Iran. Reports that the United States was preparing a trade offensive have not worried German foreign trade experts. After all, three decades of deep-seated enmity can't be forgotten so easily. And the DIHK's Treier said he is confident that the volume of trade with Iran could soon reach double-digit billions.

'Sleeping giant'

Iranian women test the fragrances of perfumes at a store in Tehran on May 13, 2010. Iran is the second largest consumer of cosmetics in the Middle East despite being ruled by Islamists who have sought for three decades to keep women modestly dressed and penalise glossy lips outside the house. AFP PHOTO/BEHROUZ MEHRI (Photo credit should read BEHROUZ MEHRI/AFP/Getty Images)

Iranian consumers are looking for Western goods, according to Treier

Treier said German companies have the right range of products to entice Iranians: automobiles, mechanical engineering, the chemical industry and electronics. What Treier called "the absolute classic German strengths" adding that for Germany, "Iran is a sleeping giant."

In addition, Germany and the German economy enjoy a solid high reputation in Iran, the IHK Tehran's Bernbeck said. "Our training and continuing education courses attract about 1,000 participants every year," he added. A training course in Germany, even if only for skilled work, is an asset to any education and allows for social advancement.

"That perception is still valid to this day, and we plan to build on that," said Bernbeck.

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