After Siemens Departure, German Firms Remain Heavily Involved in Iran

"In Response to Iran’s Nuclear Program, German Firms Are Slowly Pulling Out" reads the headline in the February 2 edition of the New York Times. Out of Iran, one supposes. The basis for this vast generalization is the decision of a single German firm, the engineering giant Siemens, to forgo any new contracts with Iranian partners.

Siemens, moreover, is a very special case. The firm had been specifically targeted for action by the advocacy group "Stop the Bomb" -- i.e., the Iranian bomb -- and it was put severely on the defensive when reports were published in the very midst of last year's post-election Iranian protests linking technology supplied by a Siemens-Nokia joint venture and Iranian regime surveillance of electronic communications. (See here, for instance, from the Wall Street Journal. A similar report had already been published in the Jerusalem Post in April, before the Iranian elections, but did not have the same impact.)

Although the accuracy of the story was challenged by both the company itself and technology experts (in the latter category, see here and here), the damage was done. The sensational reports not only sparked popular calls to boycott Siemens products, but even threats of a U.S. government boycott. Small wonder, then, that Siemens would see fit to create some separation from a market that in the grand scheme of things is of little significance for its nearly €80 billion per year turnover.

But, as the Hamburg-based political scientist Matthias Küntzel has put it in a German-language analysis recently distributed by “Stop the Bomb,” “a single sparrow does not yet make for spring.” The analysis refers to a brochure that was published in 2009 by the Tehran-based German-Iranian Chamber of Commerce and Industry and that bears the title “Branch Offices, Representations and Agencies of German Companies in Iran.”

On Küntzel’s count, the brochure identifies no less than two hundred German companies doing business in Iran. Of these, some forty-five have permanent branch or representative offices in the country. The latter include such well-known German industrial heavyweights as BASF, Bayer, Bosch, Daimler, Lufthansa, Henkel, Siemens, and ThyssenKrupp. Several of these firms, as well as numerous smaller, lesser-known German engineering firms, specialize in activities that could readily be of relevance for the Iranian nuclear program. Küntzel has compiled a list of nearly eighty firms whose products, he suggests, could potentially have “military applications.”

While officially recorded German exports to Iran have fallen off from a high of nearly €4.5 billion in 2005, they rose by nearly 9% to just under €4 billion in 2008. Last year, they declined again by some 8%. But, as Küntzel points out, in light of the global financial crisis, this was a relatively good result. Overall, German exports fell by over 18% in 2009.

Moreover, it has long been an open secret that some German suppliers avoid unwelcome notice -- and the official statistics -- by shipping to Iran via the United Arab Emirates (UAE). The New York Times appears only now to be catching on. Thus the Times report cites an unnamed German business executive who knowingly observes that “Dubai is Iran’s biggest trading partner, yet Dubai produces nothing.” Dubai is one of the emirates composing the UAE. After “confessing” that German companies do business with Iran via Dubai, the anonymous source then cattily and irrelevantly adds that “the Americans” do the same -- and even “the Israelis” something similar!