With American pressure mounting, scores of corporations leave Iran

The exiting corporations include some of the largest businesses in the world, such as US-based General Electric and the French oil company Total SA.
Sunday 02/09/2018
Shutting business. An Iranian family walks past the shuttered window of the closed offices of a travel agency showing the logos of various airlines in Tehran, on August 24.  (AFP)
Shutting business. An Iranian family walks past the shuttered window of the closed offices of a travel agency showing the logos of various airlines in Tehran, on August 24. (AFP)

WASHINGTON - More than 100 major corporations have left or are planning to leave Iran in response to the reinstatement of US sanctions, a senior US official said, providing the most comprehensive account of the departure of foreign investment from the Islamic Republic.

The exiting corporations include some of the largest businesses in the world, such as US-based General Electric and the French oil company Total SA. Many companies stopped their operations in Iran even as their home governments offered assurances they would not be penalised by staying in Iran.

“We didn’t really need to do much coaxing for these companies and banks because they’re making their own decisions and they’re making them independent of governments,” said Brian Hook, who was recently named head of the US State Department’s Iran Action Group.

Speaking at the Foundation for Defense of Democracies, a conservative Washington think-tank, Hook said major corporations were leaving Iran to avoid violating the reinstated US sanctions and being shut out of the US consumer market and banking system.

“They want access to the international financial system,” Hook said. “Their economic self-interests apply.”

The departures began shortly after US President Donald Trump announced in May that he was withdrawing the United States from the Iran nuclear deal signed in 2015 by his predecessor Barack Obama and leaders of five other countries and the European Union as well as Iran. The deal, known as the Joint Comprehensive Plan of Action (JCPOA), waived sanctions in exchange for Iran curbing its nuclear-development programme.

As the United States tries to build international economic pressure on Iran, 16 US senators pressed the Trump administration to impose even steeper sanctions by expelling Iran from the global financial system that oversees international bank transfers. The senators — all Republicans like Trump — urged US Treasury Secretary Steven Mnuchin “to take all steps necessary” to cut off Iran’s banks from the global system, known as the SWIFT network.

“The administration’s maximum pressure campaign will not succeed if the Islamic Republic remains connected to SWIFT,” the senators wrote. They sent their letter as the European Union, which wants to preserve the JCPOA, announced it would give Iran $21 million in financial support to help the country address its economic and social problems.

Hook did not address the senators’ request in his remarks but said “the real strong sanctions” would come in November, when the Trump administration reinstates punitive measures on Iran’s energy and financial sectors.

“We intend to get Iranian oil imports as close to zero as possible by November 4,” Hook said. “We need to dry up Iran’s revenues so they have less money to spend on terrorism.”

The United States reinstated a first round of sanctions on August 7 restricting purchases of certain Iran-made goods such as aluminium and steel and barring Iranians from transacting in US dollars.

Hook called the US strategy “a multipronged pressure campaign” that includes feeding information to Iranians about the regime’s corruption and publicly supporting Iranian protesters.

“We’re providing information that can ideally make its way into Iran so people can start understanding the nature of this brutal and dark theocracy. Information is power and we want the Iranian people to have as much information as they can so they can control their own destiny,” Hook said.

Hook brushed aside an assertion by Iran that it controlled the Strait of Hormuz, a major shipping route between Oman and Iran through which much of the world’s oil passes as it leaves the Persian Gulf for international destinations. General Alireza Tangsiri, the chief naval officer of the Islamic Revolutionary Guard Corps, said Iran fully controlled the strait and the Persian Gulf.

Noting that Iran “for many years” has threatened to seal off the Persian Gulf, Hook said: “They do not have control of the Strait of Hormuz. It’s an international waterway. The United States and its partners will ensure that the Strait of Hormuz is open to commercial navigation, that it maintains its current and future status as an international waterway.”

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