Friday

30th Sep 2022

EU visit to Iran designed to reassure banks

  • Mogherini represented the EU at international talks on Iran's nuclear programme (Photo: eeas.europa.eu)

A high-level EU delegation will visit Iran to reassure international banks on doing business with the Islamic Republic, but officials say they will not have time to meet human rights activists.

EU foreign affairs chief Federica Mogherini will lead a delegation on Saturday and Sunday (16-17 April), which will also include seven EU commissioners dealing primarily with energy, trade and industry.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

  • Renzi (r) met Rohani in Iran earlier this week (Photo: Iranian presidency)

It forms part of a detente following Iran’s implementation of the nuclear non-proliferation deal.

Italian prime minister Matteo Renzi visited Iran earlier this week with a group of 60 business chiefs to sign a series of deals in the oil, gas and transport sectors worth at least €7 billion.

Iranian president Hassan Rouhani also visited Paris and Rome in January. He signed commercial accords worth up to €15 billion on the French leg of the trip.

A senior EU official said on Wednesday that the sheer number of commissioners “is to give a coherent and unified message” of re-engagement.

The official said the trip was designed to “reassure everyone that re-engaging in Iran is possible”.

She said international banks, whose services will be needed to underpin future foreign investment, have been reluctant to return to Iran due to legal and reputational concerns associated with the intricate web of EU and US sanctions imposed in recent years.

The sanctions are being phased out, but some of them, such as an arms embargo linked to Iran’s ballistic missile programme and blacklists linked to human rights abuses are to stay in place.

Ahead of Mogherini's visit, EU states extended a visa ban and asset freeze for a year on 82 Iranian security and judicial chiefs linked to internal repression.

“Thirty three [Iranian banks] have reconnected to Swift so far,” the EU official said, referring to a Belgium-based firm which handles international wire transfers.

“Major banks have not been re-engaging [with Iran], it takes to time to rebuild trust and confidence.”

The Belgian KBC bank, Germany’s DZ bank and Austria’s Erste Group are among the international financiers that have resumed ties. But prior to the detente, US regulators had fined French bank BNP Paribas $9 billion for sanctions-busting.

“They’ve been told Iran is … dangerous to do business with. The European banks are afraid for the same reason,” Iranian businessman Asadollah Asgharoladi told the state run ISNA news agency after meeting a group of Hong Kong-based lenders on 6 April.

The EU official added that “Iran wants to join the WTO [World Trade Organisation] and we are willing to play a supporting role”.

She said the wanted more action “on money laundering and financing of terrorism - a law has been passed in Iran but more needs to be done, because it's an impediment to investors’ engagement”.

With Iran sitting on huge gas reserves that the EU could tap into in order to reduce dependence on Russia, the official said “oil and gas are obvious areas of cooperation”.

She added that the EU had also drawn up a €5 billion plan for modernising Iran’s civilian nuclear energy programme and that it would target other opportunities in Iran’s aviation and rail sectors.

Iran is currently fighting on the side of Russia and Syrian leader Bashar al-Assad in the Syria war.

The EU had previously said that Assad, whose massacres of civilians have prompted huge refugee flows to Europe, must go for the sake of peace.

But Russia’s bombing campaign has made this less likely, while the rise of jihadist group Islamic State in Syria has made Western powers more open to keeping him or his rump state in place for the sake of stability.

The EU official noted that “we have tried to engage Iran when it comes to facilitating humanitarian access [in Syria] - it is not easy”.

She said that Iran was a source and a transit country for refugees because it hosts up to 3 million people who fled Afghanistan.

A previous visit to Iran by Mogherini’s predecessor Catherine Ashton in 2014 prompted anger by Iranian hardliners when she met women’s rights activists at the Austrian embassy in Tehran.

Short visit

The EU official said that this time there would be “no meeting with civil society because it's a very short visit”.

The EU statement on the Iran blacklist noted that it was guilty of “grave human rights violations”.

MEPs and NGOs, such as FIDH and DHRC, wrote to Mogherini ahead of the visit to urge her to pay more attention to the issue.

The FIDH and DHRC noted that despite Rouhani’s reputation as a moderate, the number of executions a year under his watch, including executions of juveniles, has risen to heights not seen since 1989.

They said there are “at least 1,000” people in prison “for purely political reasons or for their human rights activities”. It said dozens of Baha’i followers and Christians were also in prison “solely for their beliefs”.

EU explores business deals in Iran

The lifting of sanctions against Iran after it complied with an international nuclear deal could open oil, gas, and industrial markets for EU companies.

Greek PM strenghtens ties with Iran

Alexis Tsipras was the first EU leader to go to Tehran since the embargo was lifted. He said Iran had a role to play in "stabilising the region".

EU in diplomatic push to save Iran deal

EU leaders mobilise to stop Trump's attack on Iran deal, as Congress prepares knife-edge vote with implications for trans-Atantic ties and Middle East stability.

EU circles the wagons around Iran deal

EU diplomacy chief Mogherini to fly to Washington next month, after ministers unite in support of Iran nuclear deal at Luxembourg meeting.

News in Brief

  1. EU ministers adopt measures to tackle soaring energy bills
  2. EU takes Malta to court over golden passports
  3. EU to ban Russian products worth €7bn a year more
  4. Denmark: CIA did not warn of Nord Stream attack
  5. Drone sightings in the North Sea 'occurred over months'
  6. Gazprom threatens to cut gas deliveries to Europe via Ukraine
  7. New compromise over EU energy emergency measures
  8. 15 states push for EU-wide gas price cap

Stakeholders' Highlights

  1. The European Association for Storage of EnergyRegister for the Energy Storage Global Conference, held in Brussels on 11-13 Oct.
  2. EFBWW – EFBH – FETBBA lot more needs to be done to better protect construction workers from asbestos
  3. European Committee of the RegionsThe 20th edition of EURegionsWeek is ready to take off. Save your spot in Brussels.
  4. UNESDA - Soft Drinks EuropeCall for EU action – SMEs in the beverage industry call for fairer access to recycled material
  5. Nordic Council of MinistersNordic prime ministers: “We will deepen co-operation on defence”
  6. EFBWW – EFBH – FETBBConstruction workers can check wages and working conditions in 36 countries

Latest News

  1. Going Down Under — EU needs to finish trade deal with Australia
  2. MEPs worry Russian disinfo weakens support for Ukraine
  3. Everything you need to know about the EU gas price cap plan
  4. Why northeast Italy traded in League for Brothers of Italy
  5. How US tech giants play EU states off against each other
  6. Deregulation of new GMO crops: science or business?
  7. The European shipping giants plying Putin's fossil-fuels trade
  8. Russian ideologue and caviar on latest EU blacklist

Join EUobserver

Support quality EU news

Join us