On Friday, the German government announced the official suspension of export credit guarantees and investment guarantees for German companies in Iran due to the suppression of demonstrations, the Associated Press reported, according to News.ro.

Flag of IranPhoto: DreamsTime / Donfiore

Germany’s economy ministry says it is suspending other “economic formats” – including talks on energy issues – due to the “very serious situation in Iran”.

The export credit guarantee protects German companies when exports are unpaid. The investment guarantee is provided to protect the direct investments of German companies from political risks in the countries where they make such investments.

The minister emphasizes that the use of these tools in Iran was suspended for a decade, until the “opening of a short window” in 2016 after the conclusion of the Vienna Agreement of 2015 in the Iranian nuclear file, including with Germany.

He clarifies that during this period guarantees were granted or extended for several projects, and since 2019 there have been no new projects.

The German government has decided to “completely suspend” these guarantees, and exceptions can only be granted for serious humanitarian reasons.

German-Iranian trade reached 1.76 billion euros (almost $1.9 billion) in 2021 and 1.49 billion euros in the first nine months of 2022, the ministry said.

Demonstrations erupted in Iran in September after the death of 22-year-old Mahsa Amini, who was arrested by Moravian police for violating a strict dress code for women.

They turned into a challenge to the religious regime.

Iranian authorities have tried to suppress dissent and increase repression against critics.

Following the outbreak of demonstrations, the European Union (EU) and the US imposed additional sanctions on Iran over its brutal crackdown on demonstrations and its decision to send hundreds of drones to Russia during the war in Ukraine.

Germany lobbied for a meeting of the UN Human Rights Council in November, which passed a resolution condemning the crackdown and establishing an independent commission of inquiry.