€5.5bn German insurance cover for Iran plans coming

Iran says it has seen signs Germany would start to provide a total of €5.5 billion as insurance for investments in its industrial projects in the near future.

The announcement has been made by Rokneddin Javadi, the managing director of the National Iranian Oil Company (NIOC).

Javadi has been quoted by the media as saying that he has realized in a meeting with the German deputy Economy Minister Uwe Beckmeyer this week that the country’s officials hope the issue of providing insurance for Iran investment plans will be resolved within the next few weeks.

This, he said, is necessary for encouraging German banks to proceed with funding the investment plans by the country’s businesses in Iran’s industries.

Javadi said German banks have been moving slower than the country’s industries in approaching Iran’s market after the removal of the sanctions.

However, he emphasized, the country’s small banks appear to have started limited activities to the same effect – in what he said would prepare the grounds for similar activities of bigger banks in Iran in the future.

Earlier on Tuesday, German deputy Economy Minister Uwe Beckmeyer said Iran had promised to repay soon old debts arising from state guarantees for German exports.

This is already seen as a major step that would clear the way for fresh guarantees to be issued.

“Iran has now recognized its old debts and promised me to pay them in the near-term,” Beckmeyer told Reuters.

Iran owes Germany about €500 million ($578.90 million) under so-called Hermes covers, a German government arrangement that protects German companies if foreign debtors fail to pay, Reuters added.