OpinionIran in the World PressU.S. think tank details global investment in Iran

U.S. think tank details global investment in Iran


Reuters: Companies and government agencies in three dozen countries have struck more than $153 billion in deals with Iran since 2000, investment that could offer important leverage to help persuade Tehran to abandon its nuclear program, a new study says. By Carol Giacomo, Diplomatic Correspondent

WASHINGTON (Reuters) – Companies and government agencies in three dozen countries have struck more than $153 billion in deals with Iran since 2000, investment that could offer important leverage to help persuade Tehran to abandon its nuclear program, a new study says.

The research by the conservative American Enterprise Institute think tank may be the most comprehensive attempt to publicly identify corporate and government investors whose withdrawal could potentially affect Iran’s nuclear policy.

The data comes as the U.N. Security Council considers new sanctions against Iran and momentum grows in the U.S. Congress and in state legislatures for controversial initiatives encouraging divestment in companies doing business in Iran.

The AEI report, made available to Reuters, found that while the number of new deals with Iran fell dramatically between 2000 and 2007 from 101 to 18, the value of those deals rose from $21.68 billion in 2000 to $47.5 billion in 2007.

“I think it means that companies are only interested in going in for a big pay off,” said Danielle Pletka, AEI’s vice president for foreign and defense policy.

“The companies are doing a cost-benefit analysis and saying to themselves ‘this is too good to pass up.’ Yes, fewer companies are doing business there but if the payoff is good enough, they figure, so what if they are rogue regime?”

Most of the investment from more than 300 corporations and government agencies comes from Europe and Asia and most deals involve the energy sector, given that Iran is the world’s fourth-largest oil exporter.


The report lists companies, countries, specific transactions, export credit guarantees, and export and import flows — all from public sources. It will be formally released at a news conference on Wednesday.

During the period studied, French companies were the leading investor in Iran at $30.2 billion, followed by China at $29.5 billion, Germany at $26 billion, Italy at $23.7 billion, Japan at $18.3 billion, Austria at $18 billion, the Netherlands at $13.6 billion, South Korea at $13.27 billion, Britain at $12.78 billion and India at $9.9 billion.

While the country-by-country total exceeds the overall value since 2000 cited by AEI, the think tank said it had tried to avoid double-counting of transactions where more than one country was involved.

With other factors added in, France is only Iran’s fifth-largest trading partner. While some countries, like Japan, have reduced investment in Iran, “France has remained an enthusiastic partner,” Pletka said.

Even the United States, which has had trade sanctions on Iran for nearly 30 years, posted $4.2 billion in investments. The sanctions were imposed after fundamentalist students held 52 Americans hostage for 444 days at the U.S. embassy in Tehran during the 1979 Islamic revolution.

Pletka said U.S. firms took advantage of loopholes that allowed them to conduct business through subsidiaries, as did Halliburton Co. — which recently completed its work in Iran — or to assert, like Coca Cola and PepsiCo., that they were providing needed foodstuffs.


Other companies and government agencies cited by AEI included France’s Calyon Corporate and Investment Bank, the Italian national export credit agency SACE, China National Non-Ferrous Metals Industry Corp., Germany’s Linde AG and Japan’s Chiyoda Corp.

China, which needs new energy supplies to support its booming economy, was Iran’s number one trading partner in 2005 — the last year for which trade figures were available — after four consecutive years as number two.

In 2005, Italy was the number two trading partner and also the number one guarantor of government export credits to Iran.

Japan, Iran’s number one trading partner in 2000-2004, was ninth in 2005. Tokyo has been under strong pressure from Washington to curb its dealings with Iran.

Spokesmen for the U.S. State Department and Treasury Department say they were unaware of any comprehensive U.S. government analysis of U.S. and international investment in Iran despite the fact that their agencies play central roles in the U.S.-led effort to increase pressure on Tehran’s leaders.

Conflict Securities Advisory Group, a Washington-based global security risk consultancy, keeps a file on more than 300 companies doing business in Iran but the information is for clients.

The United States and its allies have accused Iran of developing a nuclear weapon but Tehran insists it is only trying to produce nuclear energy.

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