July 27, 2010
Germany-Iran Foreign Relations
Reaction to June 2009 Iranian Presidential Election:
Germany took a negative view of the June 2009 presidential election in Iran, especially in regard to the government’s response to opposition protests. In June 2009, the German foreign minister, Frank-Walter Steeinmeier, stated that, "[t]he actions of the Iranian security forces are completely unacceptable." German Chancellor Angela Merkel declined to congratulate Iranian President Mahmoud Ahmadinejad on his August 2009 inauguration, with Deputy Government Spokesman Klaus Vater stating that "[i]n view of the accompanying circumstances of the controversial reelection, the chancellor cannot imagine congratulating."
In July 2010, Germany offered 12 Iranian dissidents asylum after their involvement in the street protests against the allegedly rigged June 2009 Presidential election. A German Interior Ministry Spokesman said that there would be a total of 50 Iranian dissidents to be offered asylum in Germany for their involvement in the protests.
In 2005, Germany voted for the IAEA to adopt safeguards against Iran, and in 2006 voted in favor of taking the conflict to the UN Security Council.  As part of the EU, Germany has supported a diplomatic resolution of the international conflict, although it has voted in favor of UNSC sanctions against Iran’s nuclear program. In December 2008, Germany argued for stricter sanctions against Iran, even harsher than those applied by the UN. These could include greater sanctions against Iran’s banking and transportation sectors - policies that would hurt German private firms. In February 2009, the EU3 proposed a list of additional stricter sanctions against the Islamic Republic, sanctions that five other European countries have opposed. In June 2009, French President Nicolas Sarkozy represented the P5+1 in a meeting with Iranian Foreign Minister Manouchehr Mottaki to encourage Iran to resume diplomatic negotiations, talks that are contingent upon Iran suspending its nuclear enrichment for the duration. Iran has so far refused to suspend enrichment, however.
In July 2009, Germany voiced its opposition to new sanctions on Iran for the time being. Instead, German Deputy Foreign Minister Guenter Gloser stressed the importance of Tehran resuming dialogue with the West. During a July 2009 meeting of EU foreign ministers, Gloser emphasized his country’s willingness to negotiate with Iran, stating that "Iran should grab the hand which has been stretched out." Despite this previous position, however, Germany Chancellor Angela Merkel came out in August 2009 in support of new sanctions against Iran’s energy sector. In an interview with the German daily Frankfurter Allgemeine Zeitung, Merkel stated that “if there is no progress, we would have to react with further sanctions…What is clear is that Tehran, whose president constantly questions Israel's right to exist, must not get the atomic bomb."
In October 2009, the P5+1 group (which includes the five permanent members of the UN Security Council plus Germany) met with Iran to discuss international efforts to halt Iran’s nuclear enrichment activities. Tehran reiterated its position that it has the right to develop nuclear energy and that this program would only be used for peaceful energy purposes. Discussion continued in late October and November, when Iran and the six world powers agreed to start a new round of nuclear talks. At this time, Iranian Foreign Minister Manouchehr Mottaki said “in all circumstances, interests of the Islamic Republic of Iran should be taken into considerations.”
In October 2009, the US, France and Russia struck a multilateral nuclear fuel deal with Iran stipulating that Iran would export more than 1,200kg of its 3.5 per cent low-enriched uranium to Russia for refining. Russia would then enrich the uranium to 20 per cent purity and France then would then turn the enriched uranium into fuel rods, which would be difficult to turn into weapons-grade uranium. In late October 2009, Tehran claimed the deal needed further negotiations and demanded changes to the deal hinting that it would only export the fuel in small batches while simultaneously importing higher-grade fuel. This suggestion contradicted a fuel deal between France, Russia, the US and Iran as well as a preliminary talks from an October 1, 2009 meeting in Geneva between Iran and the E3+3—Russia, China, the US, Britain, France and Germany. Exact dates for further fuel deal talks between Iran and the five permanent members of the UN Security Council plus Germany (the P5+1) have not yet been set. In late November 2009, Iranian Foreign Ministry Spokesman Ramin Mehmanparast told reporters that although Tehran is not opposed to sending its low-enriched uranium abroad for further enrichment, the Foreign Ministry wants a 100 percent guarantee that there will be a simultaneous exchange for fuel for its nuclear reactor on Iranian soil. Newly-appointed German Foreign Minister Guido Westerwelle said on his first official visit to Israel and the Palestinian Authority in late November 2009 that “Germany’s patience with Iran is not endless” and that sanctions against the Islamic Republic are possible, with or without the cooperation of other countries that are reluctant to pursue such a path with Iran.
In late November 2009, the IAEA passed a rebuke of Iran for building a second enrichment plan in secret, 25 votes to three. Germany supported the resolution. The resolution by the 35-member IAEA Board of Governors called on Iran to halt uranium enrichment and immediately freeze the construction of its Fordo nuclear facility, located near Qom. Ahmadinejad stated that he believed “some people were deceived” in that they did not receive proper “analysis” of the issue, adding that any sanctions would have minimal effect and world powers would not think about launching an attack on Iran.
In December 2009, an anonymous senior US official announced that a meeting by the P5+1 (including the US, Russia, China, Britain, France and Germany) on Iran’s nuclear program had been canceled due to China’s opposition, though the remaining five still planned to talk by conference call.  In late December, representatives from Germany, along with other P5+1 members, adjourned their telephone consultation about Iran’s nuclear program but did not announce when they will ask the UNSC to consider measure to increase pressure on Iran. U.S. ambassador to the UN, Susan Rice, said it was premature to discuss possible new sanctions, but the US, Britain, France, Russia, China and Germany were mulling “a range of alternatives.”
In the early part of January 2010, Iranian Foreign Minister Manouchehr Mottaki warned the West that it had one month to accept Iran’s counterproposal to the October UN offer, after which time Iran would enrich its stockpile of low enriched uranium to 20 percent, though it is unclear if it has the technical ability to accomplish this task. Although Mottaki did not say exactly the terms of Iran’s counter offer, in the past Iran has suggested a simultaneous uranium swap either on Iranian territory or in Turkey, though the West rejected this offer because it would not delay Iran’s ability to produce a weapon, should it choose to do so. Mottaki’s comments were broadcast on state television and presented as an ultimatum to the West just two days after Iran missed a deadline set by the United States and its allies to accept the October UN deal.
In January 2010, Germany and the United Arab Emirates expressed their disapproval of Iran’s nuclear activity. German Foreign Minister, Guido Westerwelle stated that Germany is “very concerned about Iran’s non-transparent behavior with regard to its nuclear program” whilst in a meeting in Abu Dhabi with his United Arab Emirates counterpart, Sheikh Abdullah bin Zayed al-Nahayan.
In mid-January 2010, the P5+1 (including the US, Russia, China, Britain, France and Germany) agreed that the Iranian response to proposals to altering its nuclear development program had been inadequate and that it warranted consideration of further measures by the United Nations Security Council. In spite of this negative response from the P5+1, a couple days later, Iranian Foreign Minister Manouchehr Mottaki announced that he saw signs of progress, stating that, “there are some minor signs indicating a realistic approach, so any probable developments or progress can be discussed later.” Later, German Chancellor Angela Merkel announced that her country will back tougher sanctions against Iran if the country does not change its tune on its nuclear program.
In early February 2010, Western diplomats told Reuters that officials at the US State Department have circulated a paper outlining possible new sanctions to senior foreign ministry officials in London, Paris and Berlin, as the US, the United Kingdom, France and Germany are working to blacklist Iran’s central bank and firms linked to the Revolutionary Guard Corps. These countries are hoping to reach an agreement with Russia and China by the end of February.
In March 2010, Brazil and Germany differed sharply on whether to threaten Iran with fresh United Nations Sanctions in a bid to rein in its disputed nuclear program. Brazilian Foreign Minister Celso Amorim and his German counterpart Guido Westerwelle said after talks that they agreed it was crucial to allow the creation of a new nuclear power, but clashed on the issue of sanctions. Germany supported imposing stricter sanctions against Iran for continued nuclear enrichment, while Brazil has argued for giving Iran further opportunity to prove its willingness to cooperate and the peaceful nature of its nuclear program.
In early April, British Prime Minister Gordon Brown and German Chancellor Angela Merkel met to discuss the Iranian nuclear program and new sanctions. Brown’s office said, “There was strong support from both leaders for sanctions and agreement on the continued need to engage with international partners on the issue.” This came just after senior diplomats from Britain, the U.S., France, Germany, Russia, and China agreed to press for a new round of sanctions.
Also in April, German Foreign Minister Guido Westerwelle announced Germany’s support for the new U.S. nuclear strategy. He argued that this new policy combined with the signing of a U.S.– Russian arms reduction agreement would point to the how serious the international community is about disarmament and Iran’s alleged nuclear program.
On April 14, 2010, the P5+1, that is the U.S., the United Kingdom, France, Russia, China, and Germany, held a second round of talks concerning new sanctions against Iran for its refusal of negotiations pertaining to Tehran’s nuclear program. Russian and Chinese United Nations ambassadors both expressed a high level of constructive consultation, and noted that there would be more talks in the near future.
In May 2010, the P5+1, that is Germany, Britain, France, Russia, China, and the U.S., reached a new agreement regarding sanctions against Iran. U.S. Secretary of State Hillary Clinton described this agreement as a “strong draft” of a resolution. The new agreement, with the change in Russian and Chinese decision to sign on to a new round of sanctions, came after Turkey and Brazil brokered a nuclear swap deal with Iran. The Turkey-Brazil proposal would allow Iran to enrich uranium at a considerably high level of purity, that is, higher than levels permitted by international law.
Also in May 2010, German customs officials blocked a shipment of nuclear technology when they arrested Germany businessmen on their way to deliver the shipment to the Bushehr power plant. This came just after Rosatam (Russia’s State Nuclear Energy Corporation) chief Sergei Kiriyenko announced that, after many delays and technical setbacks, the Bushehr nuclear is set to begin operating in August of 2010. Kiriyenko also stated that any sanctions against Iran would not further delay or altogether abandon this schedule.
In late June 2010, during G-8 talks when world leaders met in Ontario, the leaders of Germany, France, Britain, Canada, Italy, Japan, Russia, and the United States issued a statement concerning Iran’s nuclear program: “We are profoundly concerned by Iran’s continued lack of transparency regarding its nuclear activities and its stated intention to continue and expand enriching uranium, including to nearly 20 percent.”
Due to Berlin’s support for increased EU and UN Security Council sanctions against Iran, there have been fewer “market opportunities” for private German firms in Iran. Though Germany has worked with the European Union and the UN to tighten trade sanctions against Iran for its nuclear program, trade between Iran and Germany has continued in some fields. Private German firms still export more than $5 billion worth of goods; this value has increased each year even as sanctions against Iran tighten. Germany is still one of Iran’s largest trading partners, and over 1,500 German companies still do business in Iran.  In July 2009, Iran selected Germany’s Coperion to participate in the construction of Iran’s Rejal Petrochemical Complex. According to Iran’s Mehr News Agency, Coperian will be “providing the necessary equipment, installation, and commission related facilities.”
Although commerce continues, the German government has taken steps to curb the private sector’s operations in the Islamic Republic. In August 2009, the German Handelsblatt newspaper reported that several business leaders in Germany have grown discontented with pressure from Berlin to restrict non-military trade with Iran. According to the paper, exports to Iran have declined by 22 percent for the first three months of 2009 in comparison with 2008. Chancellor Merkel, however, brushed aside such complaints in August 2009, stating that “we must, as part of the international community, accept our part of the responsibility for the desired success of a diplomatic solution [to the dispute with Iran].”
The United States has also restricted trade between Iran and German firms. In August 2009, the United States Treasury and Commerce departments fined DHL, a Germany delivery firm, $9.4 million. The US Treasury Department argued that the firm had failed “to meet recordkeeping requirements” in trading with Iran, Syria and Sudan. Despite these trade restrictions, Germany attended the Iranian gas forum in Tehran on September 26-27, 2009 with the United Kingdom, Japan, the Netherlands, South Korea, and Malaysia.
In November 2009, Iranian Managing Director of the Gas Export Company, Reza Kasaeizadeh, said the company is in talks with Austria’s OMV and a Germany energy company. The three companies are negotiating multilateral cooperation in the twelfth phase of development of the large South Pars gas field in Iran.
In December 2009, the German government began investigating engineering giant Siemans for the possible violation of export control laws by shipping advanced equipment to companies in Iran. Though Siemans insists its business in Iran is purely civilian, Germany worried that the equipment could be used for Tehran’s missile or nuclear programs.
In January 2010, Iran signed a $1.4 billion deal with a German firm to build 100 gas turbo-compressors. Head of the Iranian Gas Engineering and Development Company Ali Reza Gharibi, said the contract stipulates the German firm will transfer the technical expertise to build, install, and run equipment needed to exploit and transport gas.
Near the end of January 2010, a German construction company hired to renovate the Bander Abbas Port in Iran canceled its contract after Israeli Ambassador to Germany, Yoram Ben Ze’ev, stressed that a Gaza-bound ship “Francop” stocked with weapons had been dispatched from the Bander Abbas port.
In early February 2010, German companies announced that they find it increasingly difficult to do business with Iran as the US, Israel, and others campaign for tougher UN sanctions in response to the country’s nuclear program. Despite these setbacks, Germany remains Iran’s biggest trading partner in Europe. These companies are leery of permanently losing a lucrative market if they completely and immediately pull out of Iran. The spokesperson for lobbying group German Engineering Federation, Ulrich Ackermann, voiced his concern saying, “what our members want is a level playing field. If our German companies pull out, will other, non-German companies replace us?” Shortly thereafter, a spokesperson for the German insurance company Munich Re AG announced that it will not renew existing business or write any new business with insurance companies in Iran due to the political situation there. The Munich-based company says the decision will affect the Munich Re’s premium volume of around 10 million euro annually. Allianz SE, another insurance company based out of Munich announced that it too “has decided not to renew insurance treaty business in Iran because of political developments in the region.” Allianz is Europe’s largest primary insurer a large margine and the spokesperson added that their business with Iran “amounts to negligible premiums.”
In April 2010, German carmaker’s chief executive Dieter Zetsche announced that Daimler plans to divest its 30% stake in an Iranian company. Zetsche explained, “In view of the current political situation we have extensively reassessed this business relationship.
In July 2010, the Wall Street Journal quoted Western officials in a report alleging that Tehran has been using a small, Iranian-owned bank in Germany, the European-Iranian Trade Bank AG, “to conduct business on behalf of the regime’s blacklisted companies.” The blacklisted companies hold this status by the U.S., the United Nations, and the European Union. The list includes Iran’s defense Industries Organization, the Aerospace Industries Organization and the Iranian Revolutionary Guard Corps for their alleged involvement in developing Iran’s nuclear and missiles programs. Shortly after the report, spokesman for the German Finance Ministry Michael Offer stated, “I can say that, so far, the bank oversight authority has no information about violation… but that BaFin [the German Federal Finance Supervisory Authority] and Bundesbank [German Federal Bank] are investigating all these allegations” of the small Hamburg-based bank and its activities with blacklisted Iranian companies.
Much of Germany’s political cooperation with Iran revolves around Iran’s controversial nuclear program. In March 2009, then former German Federal Chancellor Gerhard Shroeder paid Iranian President Mahmoud Ahmadinejad an unofficial visit to discuss Iran’s controversial nuclear program. In May 2009, Germany began increasing pressure German companies to reduce their trade with Iran even as Iranian Oil Minister Gholamhossein Nozari urged German firms to invest in Iranian oil. German Chancellor Angela Merkel also sent a letter to firms in an unsuccessful effort to prevent two conferences on investment opportunities in Iran. Despite disagreements over Iran’s nuclear program, Germany has reached out to Iran to aid in peacekeeping efforts in Afghanistan. In May 2009, German Defense Minister Franz Joseph Jung said Germany suggested Iran should play an “important role” in stabilizing Afghanistan and preventing cross-border drug trafficking.
In June 2009, the Group of Eight (G8), of which Germany is a part, held a meeting in Trieste, Italy to discuss security in Pakistan and Afghanistan. At the meeting, the G8 demanded “that violence [in Iran]…cease immediately” and called upon Iran to find peaceful solutions to the political crisis. In July 2009, after the detention of several British Embassy staff in Tehran, German Chancellor Angela Merkel rejected British calls to collectively recall EU ambassadors to Iran, saying that G8 members should instead send a “strong signal” to the Iranian government and expressed hope that “the [July 2009 G8] meeting [in Italy] sends a strong message of unity, a united message that the right to demonstrate and human rights cannot be separated and that they apply to Iran.”
Non-state actions have also affected Germany-Iran ties. A group of roughly sixty Berlin protesters participated in a three day hunger strike on July 24, 2009 in response to alleged Iranian abuse of protesters detained during the unrest that followed Iran’s June 2009 presidential election. The strikers demanded “the unconditional release of all political prisoners and abolition of all kinds of torture in prisons.” Several other major German cities also experienced anti-Iranian protests in late July.
Bilateral ties were further harmed following the murder of Marwa el-Sherbini, an Egyptian Muslim woman testifying in a Dresden court. In response to the incident, the Iranian Foreign Ministry summoned German Ambassador Herbert Honsowitz on July 10, 2009 to express its disapproval. Iranian Foreign Ministry Spokesman Hassan Qashqavi described the murder as a violation of "all human rights and values." The Iranian Foreign Ministry chastised the German government for the incident, saying that it was the obligation of Berlin to ensure the safety of Muslims living in Germany.
On August 2, 2009, Foreign Minister Frank-Walter Steinmeier condemned the trials of Iranians who protested against Ahmadinejad’s re-election. The foreign minister claimed that the “minimum demands of constitutionality for a transparent and fair trial are not being observed." The next day, Iranian Foreign Minister Spokesman Hassan Qashqavi responded aggressively by stating that Steinmeir’s criticism was “contrary to legal judiciary procedures in an independent country regarding the illegal acts of a group of criminals." According to an August 12, 2009 German Foreign Ministry statement, Berlin summoned Iran’s ambassador to Germany, Ali-Reza Sheikh Attar, in order to “convey our expectation that the people jailed during trials should be released immediately."