U.S. Secretary of State Mike Pompeo said Friday that Washington would not stand in the way of a system that Europeans are developing to shield companies from American sanctions if they deal with Iran, so long as the focus is providing humanitarian and other permitted goods.
Pompeo, making his first visit to Germany as secretary of state, said the U.S. does not take issue with the development of the system known as INSTEX, so long as it deals with the trade of goods not subject to sanctions, as the Europeans contend it will.
“We’ve been pretty clear about trade with Iran — there are items that are sanctioned and there are items that are not,” Pompeo told reporters after meeting with German Foreign Minister Heiko Maas at a government villa in suburban Berlin.
“When we think about INSTEX, if it’s aimed at facilitating the movement of goods that are authorized to move, it’s unproblematic,” he said.
Since withdrawing unilaterally from the landmark 2015 deal with Iran that offered economic incentives in exchange for curbs on its nuclear program, the U.S. has been at odds with the other nations involved that have been trying to keep the deal alive — Germany, France, Britain, Russia and China.
As the U.S. has increased sanctions and companies have been pulling business out of Iran, the Europeans have been developing INSTEX, a complicated barter-type system to skirt direct financial transactions with Iran and so evade possible U.S. sanctions.
The system is not yet up and running, but they hope to have it functioning by this summer.
Maas emphasized that even though the U.S. was no longer party to the Iran agreement, known as the Joint Comprehensive Plan of Action, or JCPOA, its goal was the same.
“We both agree that Iran must be prevented from obtaining nuclear weapons,” Maas said. “It’s no secret that we differ on how to achieve that.”
In other comments, Pompeo praised Germany for granting asylum to Chinese dissidents and reiterated Washington’s position that China’s telecommunications giant Huawei should be excluded from helping develop 5G networks in Germany and elsewhere due to security risks.
Maas reiterated that Germany was not prepared to exclude any company from bidding but said any firm that could not meet security standards would be rejected.
The U.S. has also been critical of Germany for going ahead with a joint project with Russia to build the Nord Stream 2 pipeline that would take Russian natural gas directly to Germany under the Baltic, arguing it is a security issue because it would increase Europe’s energy dependence on Russia.
Pompeo refused to comment, however, on whether the U.S. was prepared to sanction German companies involved in the project.
“We never discuss sanctions before we roll them out,” he said.
Following the meeting with Maas, Pompeo held brief talks with Chancellor Angela Merkel, who had just returned from a trip to the U.S. to give a commencement speech at Harvard.
Before Friday’s meeting, Merkel said she and Pompeo would discuss how to prevent Iran from getting nuclear weapons and “how we prevent other aggressive actions by Iran.” She stressed the importance of decades of German-U.S. friendship — a theme echoed by Pompeo, who said “Germany is a great, important partner and ally of the United States.” They took no questions.
Pompeo was traveling from Berlin to Switzerland, which has long represented Washington’s interests in Tehran.