Regional realities see Germany focus on Gulf over Iran
Berlin was last week the theater for events promoting deeper engagement between Germany and Gulf Cooperation Council (GCC) countries. The events were organized by official groups such as the Federal Academy for Security Cooperation and private organizations like the German-Arab Friendship Society. In another sign of renewed interest in the GCC region, chambers of commerce were also active, as well as Germany’s three major foundations (Bertelsmann, Konrad Adenauer, Berghof), which participated fully in the happenings.
The return to active GCC-Germany engagement is in part a result of the energetic efforts of GCC embassies in Berlin and Germany’s diplomatic missions in the region. They have been trying to reverse recent trends of estrangement between the two sides as a result of their diverging views on regional issues, human rights, the war in Yemen, and the nuclear deal with Iran. Declining trade over four years may be another sign, with German exports to the GCC declining from around $32 billion in 2014 to $23 billion in 2018.
While diplomats deserve credit for the active return of GCC-German dialogue, there are also several political and economic factors that underpin the change. First, Germany has been disillusioned by Iran’s policies in the region. There was hope that signing the nuclear deal in 2015 and the accompanying rise in the country’s international standing would lead Iran to change its posture and become more compliant with international norms. However, the opposite has taken place. The Islamic Revolutionary Guard Corps has interpreted the deal as a license to increase its destabilizing activities in the region. The financial windfall was used in part to fund IRGC activities and those of its proxies. Iran’s brazen behavior was epitomized by threats to close the Strait of Hormuz and Bab Al-Mandab Strait and impede its neighbors’ oil exports. Those threats were followed by attacks on oil tankers and increased missile and drone attacks on Saudi Arabia’s oil installations. Germany has been critical of the reimposed US sanctions, but did not agree with Iran on how to resist them.
The recent visit by Germany’s Foreign Minister Heiko Maas to Iran found that Tehran was not in a mood to climb down from its confrontational position. Iran’s breach of the nuclear deal’s limitations has alarmed Germany, its foremost champion within the EU. Now that those breaches have been confirmed, there are likely to be serious consequences.
Iran’s breach of the nuclear deal’s limitations has alarmed Germany, its foremost champion within the EU.
Abdel Aziz Aluwaisheg
At the private level, Iran’s standing in Germany has also suffered significantly because of its hardening regional positions since the nuclear deal was signed, but especially since revelations about its role in perpetuating the Syrian refugee crisis and the criminal activities of Hezbollah in Europe. The only exception may be among the lunatic fringe, where some extremist groups have tried to find common cause with Iran, based on some mythical kinship between the two nations. It is reminiscent of Nazi Germany’s efforts to woo Iran to its camp against Russia and Britain. In 1939, Germany provided Iran with a “scientific library” of more than 7,500 books selected to convince Iranian readers of the kinship between the two ethnic groups. Germany remained Iran’s foremost foreign supporter and, for decades, its No. 1 trading partner. In recent years, some Germans of Iranian origin have participated in right-wing attacks on immigrants based on those Nazi notions.
The disillusion with Iran is especially clear in the German business community. The nuclear deal did not result in a trade boom and they found the Iranian market to be insignificant and hard to navigate. Iran’s gross domestic product (GDP) is less than $400 billion and is quickly shrinking.
Trade between Germany and Iran has in fact collapsed despite Berlin and the EU’s efforts to facilitate that trade and get around US sanctions. German Chamber of Commerce information shows that German exports to Iran totaled about $525 million during the period January to April 2019, down a dramatic 49 percent compared to the same four months in 2018. Iranian exports to Germany, at around $92 million, were almost negligible in comparison.
It is estimated that about 60 German companies are still doing business in Iran, according to the Chamber’s data, but their numbers are declining and their footprint in the country is also shrinking.
With efforts failing to increase trade and investment flows with Iran, Germany’s businesses are seeking to return to their traditional partners in the GCC. The combined GCC GDP is $1.8 trillion, or 4.5 times Iran’s market. And Germany’s exports to the GCC are currently about $23 billion, or 50 times its exports to Iran.
The reality in the Gulf region is clearly affecting German attitudes. While there is palpable skepticism about US strategy on Iran, there appears to be even more frustration with Tehran’s brinkmanship, which is endangering international shipping in the Gulf and increasing its destabilizing regional activities and support for terrorist groups.
In addition to these factors, Germany would like to play peacemaker in the region. To be able to play a role in de-escalation, it cannot afford to be seen as siding with Iran against the US and GCC countries.
- Abdel Aziz Aluwaisheg is the GCC Assistant Secretary-General for Political Affairs & Negotiation, and a columnist for Arab News. The views expressed in this piece are personal and do not necessarily represent GCC views. Twitter: @abuhamad1
