Sputnik - Donald Trump said that anyone doing business with Iran will not be doing business with the US. Via Twitter, he said that sanctions imposed on Tehran were "the most biting," adding that he's asking for world peace. In response, Iran's President Hassan Rouhani accused the US of using "psychological warfare," aiming to "sow division among Iranians."




Sputnik has spoken with�Dr. Ludwig Watzal, editor and freelance journalist about�the consequences of�the re-imposed US sanctions on�Tehran

Sputnik: The European Union has announced counter-measures against�the US sanctions on�Tehran, in�your view will this move be able to�prevent an exodus of�European companies from�Iran?

Dr. Ludwig Watzal:�I'm very skeptical. The EU has revived its so-called blocking statute, originally drawn up�in the 1990s, against�US sanctions against�Iran, Libya, and Cuba. The blocking statute prohibits European companies from�complying with�the US measures and allows them to�recover damages arising from�the sanctions. If enforced the statute will make compliance with�the US sanctions illegal.

I think these counter-measures will not prevent the exodus of�European companies from�Iran. This exodus has already begun. The French oil giant Total has already canceled its contract with�Iran, so did French automakers. Also German companies such as�Siemens, Mercedes, and BMW, I assume will follow suit. Only European small businesses which do not have strong business contacts and ties to�the US can afford to�trade with�Iran. Europe's big companies I guess will all leave the country very soon.

Sputnik: Mike Pompeo warned that Washington plans to�enforce its sanctions on�Tehran, what mechanisms can it use to�achieve that do you believe?

Dr. Ludwig Watzal:�I think the US is going to�try to�bully Iran into�submission while pressuring European companies. The announcement of�pulling out�of the nuclear deal has already had a negative effect. Economic growth in�Iran went down�over 6%, before�the announcement the economic growth was around�6%, inflation went into�single digits and the standard of�living increased.

After the US pulled out�of the deal the Iranian currency, the rial; plunged officially over�20%, on�the black market I think it's even more. Trump's aggressive rhetoric had already intimidated many companies, whether they will live up�to that rhetoric of�the European Union remains to�be seen. Rhetorically speaking, I think, the EU always talks big but�when it comes down�to basics they show the white feather.

Sputnik: Germany, France, and the United Kingdom said they will stand by�the Iran nuclear deal; will that help salvage the agreement in�your opinion?

Dr. Ludwig Watzal:�I'm skeptical about�the ability of�the Europeans to�save the nuclear deal in�the long run; whether the EU can live up�to its own rhetoric remains to�be seen.

The Trump administration will use any tool available to�coerce the European partners to�go along�with US policy. He has so many tools available. For example, like�the pressure over�NATO, which could be seen after�the last NATO meeting, that the Europeans were willing to�increase their pay to�the organization. So there are so many tools the US has that the Europeans just in�the end can't avoid to�comply with�it.

Sputnik: What's your thoughts about�Iran and whether it is prepared to�negotiate a new deal with�President Trump like�he has suggested, what's your take on�this? He's really ratcheting the pressure up; do you think they're going to�submit to�his demands?

Dr. Ludwig Watzal:�I doubt it. I hope they won't. Trump's offer to�meet with�the Iranian president and start talks without�preconditions, in�my opinion, is a trap. The US violated an agreement as�the only one signatory. They have been defaulting and dropped the words. The Europeans have so far rejected negotiating, renegotiating the nuclear deal, but�the US will not only broaden the subject but�also want to�get more countries aboard, perhaps, even Israel. The US sanctions saw the rationale of�the US will finally work because it will punish the companies that do business with�Iran.

Sputnik: What will happen to�the Iranian economy after�another round�of sanctions come into�force in�November? Is there a certain amount of�inevitability about�this, other experts are talking about�the opportunity of�increased purchase of�oil by�China and also possibly India, are you in�agreement with�that? Or is it just basically small change as�compared to�the ultimate damage that's going to�be affected here?

Dr. Ludwig Watzal:�Well, the damage is already done and will increase. Economically speaking these November sanctions mean that sanctions on�the oil industry will have a more harming effect than�the current ones. Foreign investments will further decrease; European banks will reject giving any loans to�investors to�invest in�Iran for�fear of�drawbacks from�the US. So the economy will further decrease. One can understand these crippling sanctions since�Trump pulling out�of the nuclear deal without�considering the elephant in�the room�� the state of�Israel.

We have to�remember that under�the Obama administration Netanyahu and his then-Defense Minister Ehud Barak tried everything they could to�attract the US to�attack Iran. But, as�you perhaps remember, that the former Israeli intelligence chief, like�for example, Meir Dagan, tried to�hinder it by�saying it's the most stupid thing to�attack Iran. So together with�the US military, they could prevent the United States from�going to�war with�Iran. Today, it's a different story; the US has a president who wants to�undo everything Obama achieved.

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