ISIS Iran Report

Germany tightens trade restrictions; Can it do more?

Germany tightens trade restrictions; Can it do more? photo

February 2, 2009

Hermes cover is used when private companies sell to countries or entities in countries deemed risky by credit markets; the government provides guarantees in case the buyer defaults, allowing companies to go ahead with sales).  Reportedly Chancellor Angela Merkel, in response to criticism from the United States that it is not doing more to curb trade with Iran, has decided to curtail use of such guarantees.  Of the three EU partners leading diplomacy with Iran, Germany has long been the least enthusiastic about sanctions.  Wall Street Journal Europe editorial writer Daniel Schwammenthal explains why here.  According to Schwammenthal, Germany‚Äôs trade with Iran rose more than 14 percent in 2008.  More interesting, he cites a recent German-Iranian Chamber of Commerce finding that 75 percent of small and medium-sized Iranian factories use German equipment and technology, potentially giving Germany enormous leverage over Iran should it choose to exercise it.  (Photo credit: German-Iranian Chamber of Industry and Commerce)

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