Thursday, 13 December, 2018

Germany’s Siemens signs a contract to upgrade Iranian railway

mazandaran_sevatcow_dowab

Germany’s Siemens signed a contract to upgrade Iran’s railway network on Monday, one of several deals agreed by German firms during a two-day visit to Tehran by Economy Minister Sigmar Gabriel.

Gabriel has flown to Iran with a planeful of 120 managers who are keen to re-establish business relations with the Islamic Republic after it reached a landmark deal with world powers last year to scale back its disputed nuclear program.

But political concerns, and a range of U.S. sanctions still in place, have so far held back a hoped-for business boom.

Siemens said it will supply components for 50 diesel-electric locomotives to Iran. It did not disclose the value of the contract, but based on comparable deals, it could be in the low hundreds of millions of euros.

The economy ministry said several firms from the Mittelstand, the small-to-medium-sized companies that form the backbone of the economy, had also signed deals with Iranian partners. These included SMS group, a builder of steelmaking plants, and INTRA industrial solutions.

In addition, Mitsubishi Germany has signed a contract to modernize a gas-fired plant, while plant constructor Keller HCW wants to build a brickyard in Iran, it said. Both countries’ central banks have also agreed to technical co-operation.

There was no detail on the size of the agreed deals.

Iran’s Deputy Economy Minister Mohammad Khazaei said earlier that 10 economic agreements would be signed on the sidelines of Gabriel’s visit. “I hope that this will smooth the way between both countries,” he said.

Germany, which has commercial and cultural ties with Iran that go back to the 19th century, was for decades a major trading partner of Tehran before the sanctions allowed China and several other nations to overtake it.

While industrial firms such as Siemens are keen to benefit from opportunities in Iran, Gabriel has warned Tehran that to normalize ties it must accept Israel’s right to exist and stop what he called Iran’s decisive role in the Syrian civil war, where it has intervened to support President Bashar al-Assad against Western-backed rebels.

The German banking sector has been reluctant to underwrite business deals for fear of falling foul of remaining U.S. sanctions imposed on Iran for what Washington says is Tehran’s money laundering, support for terrorism and human rights abuses.

Gabriel said earlier that Germany wants to help Iran push ahead with reforms, and promised to remind the United States of its commitment to reduce sanctions against Iran.

He also said that Iran was a reliable credit partner that kept agreements as a rule.

German exports to Iran jumped 15 percent in the first half of the year to 1.13 billion euros and could reach 4 billion euros in the full year, said Michael Tockuss, head of the Hamburg-based German-Iranian Chamber of Commerce.

Reuters

Photo: A railway bridge at Do Ab, Mazanderan Province on the Gorgan — Bandar Shah line, 2007 / Wikipedia

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1 Comment

  1. Amir

    October 4, 2016 at 6:35 pm

    Who would be better than Iranians whose money owed to any creditor is about 50 Dollars as comparison to Americans who owe money to any creditor almost 55000 Dollars, each. If I had money I would diffidently go to countries with less money owed to its GDP (real money- not phony US economy with 17 trillion of air money). Look, an investor looks at the Iran’s scenario this way; almost 95 percent Iranian own what they have, from the cars they drive to the houses they live in or rented out. As an investor, I would leave a suitcase of the money in front of their houses and ask the owner of the house just sign me as the lean holder of the property; of course I would not go beyond 80 percent of the real value of the house or average price of the same house for past two to three years.
    In US, I own a house that up to 90 percent of its value is borrowed. I drive a car that I am paying payments on. I buy household items that I am still paying interest on. So do I consider myself lucky? Yes. But do I consider myself rich? No. Why? Because the amount of the money I owe is way over my limit, they call extended leverage. Let’s put it this way, I am swimming in the water and I am allowed to breath anytime needed as long as I feel good and I don’t feel worried. There is always somebody out there, as creditor, waiting to give me more money to let me afloat in the water. It is like you borrow from Mr. Y 6 Dollars to pay off Mr. X 5 Dollars money you borrowed, of course, with lots of interest including your underwear. Oh! I forgot to mention that you are allowed to have bankruptcies one after another without any consequences as long as you don’t owe money to any government agencies. Example: Mr. Donald Trump.
    So, most investors love to invest in Iran since Iran has way to go to become like USA or any industrial countries on earth. Iran is a rich country with lots of natural resources for next generation. Everybody on earth knows about it. Now the leash is gone, investors come like flock of birds looking for a place to nest for a long-long time. I would recommend every single Iranian; take the money- invest it wisely, and don’t let others to intimidate you. One more thing, take lots of vacations as well, it is not your money, it is their money. Let them worry about their investments. They are willing to give, why not taking it. After 40 years on non-senses, you deserve it. Please take it. Any form- any shape, any which way you want. .

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