Germany decried Donald Trump’s withdrawal from Iran nuclear deal in May and also pledged to help firms to continue to do business with the country even though the US president said “anyone doing business with Iran will NOT be doing business with the United States” in a tweet.
However, it looks like the eurozone’s largest economy has relented to Trump’s threats after German state-owned rail operator Deutsche Bahn and Deutsche Telekom (DTE.DE) confirmed that they are are ending projects in Iran. This follows German carmaker Daimler (DAI.F) halting all activities in the country too.
It is perhaps unsurprising that Germany has been rolling back its dealings with Iran after assessing the numbers. While 10,000 German companies trade with Iran and around 120 German firms operate and have staff of their own in the country, including Siemens (SIE.DE), this is pocket change for the economy when compared with dealings it has with the US.
While German exports to Iran hit $3.42bn in 2017, this is only worth 0.2% of its total exports. The figures are perhaps not enough to risk causing further pain by triggering Trump to double down on his protectionist trade measures.
After all, Germany is US’s largest trading partner in the European Union, accounting for 30% of the bloc’s total exports of $127bn last year. Germany also imported $52bn worth of US goods in 2017.
Germany’s ally France also seems to be following suit. Despite standing side-by-side to renounce Trump’s stance on Iran in May, France’s oil giant Total (FP.PA) and carmakers Peugeot (UG.PA) and Renault (RNO.PA) have already suspended plans to invest in Iran.