Wednesday, 18 July, 2018

How will Trump visa ban negatively affect Iran-Boeing deal?

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By Mohammad Shamshiri, Editorial Board Rember

U.S. President Trump’s order to deny entry to visa travelers from seven countries is likely to have negative effects on Boeing’s $16B aircraft deal with Iran.

In December 2016, Iran signed a deal to buy 80 passenger planes from U.S. aircraft maker Boeing.

As per the deal, the American firm will supply 50 737 MAX 8 aircraft, 15 777-300ERs and 15 777-9 to the Iran Air. Boeing said that deliveries will commence from 2018.

However, there are now fears that Trump’s visa restrictions may negatively affect, whether directly or indirectly, on the biggest Iran-U.S. deal since 1979.

Iranians are among the group of seven countries targeted in the executive order. It means that an Iranian could no longer travel to the U.S.

Therefore, unlike with the delivery of the first Airbus aircraft that Iran recently took in France, Iranian pilots would be unable to themselves take physical delivery of Boeing jets manufactured in America.

This will pose serious problems in the implementation of the deal. Then, it is likely that Iran will protest that this executive order is in direct violation of the JCPOA. In such a case, the contract may be in jeopardy.

Also, if Iran decides to ban US citizens from entering the country in response to Trump visa ban, Boeing will find much harder to service the airframes that have already been purchased and to be in the running for new orders, according to an article by Gulf News.

‘US firms and other firms from around the world use skilled US staff as a fundamental part of their business. Aviation relies on very skilled staff for almost all of the work that is done and the talent pool available is not infinite. To ban nationals from any country is not likely to make the talent pool expand’, Andrew Charlton, managing director of Geneva-based Aviation Advocacy told Gulf News.

Anyway, recent Trump’s visa ban affects adversely on Iran, which in turn also negatively affect the U.S companies like Boeing who are looking for new markets in the Middle East.

In September last year, the U.S. Treasury Department gave approval for Boeing and its European competitor, Airbus, to sell planes to Iran.

Boeing confirmed the deal, saying that the contract was reached within the terms of the government license that the department had issued.

However, Republican supporters in Congress have introduced the bills that attempts to stop sales by Boeing to Iran, obliging the Treasury Department to refuse the licenses needed by American banks to finance such an agreement.

Trump has had different stances on the sales of Boeing aircraft to Iran. In June, his campaign gave out a statement on the negotiations between Iran and Boeing, saying, “The world’s largest state sponsor of terror would not have been allowed to enter into these negotiations with Boeing without Clinton’s disastrous Iran nuclear deal.”

But in January, he complained in a post on Twitter that after the nuclear agreement, the Iranians were going to spend their money in Europe rather than in the United States.

“Iran is going to buy 116 jetliners with a small part of the $150 billion we are giving them … but they won’t buy from U.S., rather Airbus,” he wrote.

NY times contributed to this report

 

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2 Comments

  1. Amir

    January 30, 2017 at 6:36 pm

    Let Boing handle it. They are part of the government, specially a government that is made of billionaires. No worry- sleep tight. Well, if not, Airbus will take care of the rest. Actually, have you been in one of the 380s lately? Remember, the nuclear sanctions against Iran was passed by UN rather US, and it was dismantled by unanimous UN members, not US. US can no longer do anything to reverse the deal, only to poke itself on the eye if they go against the deal.

    • Dave

      June 9, 2017 at 3:40 am

      Wow, aren’t you ignorant. The US certainly can cancel the deal, they can also enforce their own deal. Iran’s terrorist activities are no longer ignored in the US.

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