European leaders gathered in Sofia on Thursday to hash out a plan for shielding Iran from the brunt of US economic sanctions as they try to convince Iranian President Hassan Rouhani to continue abiding by the terms of the deal, while proposing levying tariffs on US goods in response to Trump decision to impose sanctionson Iran.
Shortly after President Trump announced that the US would pull out of the deal, Rouhani promised that his country would continue abiding by its terms only if Iranian businesses could continue operating normally.
In an interview with Germany's Deutschlandfunk radio, European Union budget commissioner, Guenther Oettinger discussed several options for preserving the deal, including using the European Investment Bank to offset the impact of sanctions by extending loans to firms with financing problems. In an example of one more-extreme measure under discussion, the EU has also considered "imposing its own tariffs" on the US that would make it much harder for US firms to sell their goods and services in the trade bloc.
Of course, the US has important goods and services in the industrial sector that it would like to offload in Europe, Oettinger said.
While sanctions weren't the EU's first choice for preserving the deal, few other actions would be strident enough to get President Trump's attention, as Oettinger made clear:
"We want to resist that. We have limited possibilities," he said.
"Trump despises weaklings. If we back down step by step, if we acquiesce, if we become a kind of junior partner of the US then we are lost."
And while the EU would like to protect its largest companies from US sanctions, French President Emmanuel Macron said on Thursday that companies would be responsible for deciding whether they will still do business with Iran.
Macron was referencing French oil firm Total, which said on Wednesday that it would end work on a large gas field project in Iran unless it receives an exemption from US sanctions against Tehran, according to Reuters. Tehran had hailed that project as a symbol of the deal's efficacy.
Meanwhile, A.P. Moller-Maersk, the world's largest container shipping company, also said it would cease business operations in Iran.
CEO Soren Skou told Reuters on Thursday that A.P. Moller-Maersk was following suit.
"With the sanctions the Americans are to impose, you can’t do business in Iran if you also have business in the U.S., and we have that on a large scale," Skou told Reuters in an interview following the firm’s first-quarter report.
"I don’t know the exact timing details, but I am certain that we’re also going to shut down (in Iran)," Skou said.
Finnish mining technology company Outotec said US sanctions would complicate its business with Iran, though it added that it's too early to make a final decision on whether it would leave the Iranian market.
Macron said France backed proposals by the European Commission to protect and compensate European companies that might be hit by US sanctions for trading with Iran.
"International companies with interests in many countries make their own choices according to their own interests. They should continue to have this freedom," Macron said after arriving for a second day of EU leaders’ talks in the Bulgarian capital.
"But what is important is that companies, and especially medium-sized companies which are perhaps less exposed to other markets, American or others, can make this choice freely."
That said, there's no easy or quick way to protect companies from US sanctions, and that it will take time before the bloc can decide on a strategy. And even when they do, the plan will likely fall short of the types of firm guarantees that the Iranian authorities are seeking.