Swedish companies withdraw from Iran over US sanctions

Swedish companies have been “gradually” trimming their business operations in Iran following the re-imposition of the US sanctions against the Islamic Republic, the Swedish Minister for European Union (EU) Affairs and Trade, Ann Linde, said yesterday.

“The messages we [Swedish government] received from the Swedish companies, which we had been in touch with, indicate that, in general, they have reduced their business in Iran in order not t o jeopardise their business in the United States, which is a far larger market,” Linde told Sweden’s TT.

“The ban on compliance with sanctions signalises how seriously the EU views the sanctions,” the minister pointed out, stressing that “every company takes its own decision, we [Swedish government] are not forcing any of the companies to continue operating in Iran.”

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The American sanctions have negatively affected mainly the work of the Swedish automakers. Scania AB, a truck manufacturer whose operations in Iran accounted for around five per cent of its total annual sales in July, said recently that it had cancelled all its Iran deals which wouldn’t be completed before mid-August.

Iran is also one of the most important markets for Swedish exports, particularly in the mining, telecommunications and transportation sectors. Following the previous US sanctions, Swedish annual exports to Iran fell from €670 million to €100 million. When the sanctions were lifted in 2017, exports between the two countries reached €430 million, which amounted to 0.3 per cent of all Swedish exports at the time.

On Monday, the US administration reinstated comprehensive sanctions against Iran, including secondary sanctions targeting states doing business with the country, which were previously frozen by the Joint Comprehensive Plan of Action (JCPOA), also known as the Iran nuclear deal.

In May, the US President Donald Trump announced that his country would unilaterally withdraw from the JCPOA deal, which stipulated the gradual lifting of the anti-Iran sanctions in exchange for Tehran maintaining the peaceful nature of its nuclear programme. The move was opposed by the EU and all signatories to the deal.