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Why is Merkel Protecting Iran's Terror Bank?

Double standards.

1:21 PM, Sep 8, 2010 • By BENJAMIN WEINTHAL
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Berlin

Why is Merkel Protecting Iran's Terror Bank?

Angela Merkel

German Chancellor Angela Merkel is slated to honor today in the city of Potsdam, just outside of Berlin, the Danish caricaturist Kurt Westergaard, whose cartoons satirizing the Prophet Muhammad and fanatical Islam triggered violent protests across the Muslim world in 2005. Westergaard will receive the “M100” media prize for his devotion (and unwavering courage) to press freedom.

What is striking about Merkel's tribute to Westergaard's fight for the right to speak freely is her vehement opposition to shutting down the Hamburg-based European-Iranian Trade Bank (EIH), a terror entity whose revenues help prop up the Iranian regime and suppress freedom of press in Iran.

It is also disturbing that the city of Hamburg would essentially be used as the European financial center of the Islamic Republic of Iran and that the EIH has essentially been used as a conduit for Iran's missile and nuclear program. That helps explain why the U.S. Treasury Department on Tuesday designated the bank a terrorist entity. According to Stuart Levey, who is spearheading anti-terror measures across the globe for the U.S Treasury Department, "As one of Iran's few remaining access points to the European financial system, EIH has facilitated a tremendous volume of transactions for Iranian banks previously [blacklisted] for proliferation.”

The Treasury Department's designation of EIH is the first enforcement act of the new Iran sanctions legislation.

German Foreign Ministry and bank control officials are laying low, hoping that the scandal-plagued EIH crisis will fizzle out. When the Wall Street Journal blew the whistle on the EIH's unlawful proliferation activities in July before the EU sanctions, there was a media blackout among all German editorial writers who chose not to urge Merkel to pull the plug on EIH's operations. Writing in the International Herald Tribune, veteran columnist John Vinocur noted that “I also have been told that similar reluctance, this time involving German hesitation to clamp down on a bank in Hamburg facilitating suspect European deals with Iran, resulted in a recent phone call, to no immediate avail, from Mr. Obama to Chancellor Angela Merkel. “

Journalistically speaking, German reporters gladly seize on every interaction between the chancellor and President Obama, with particular attention to trivial items. But collectively, they have willfully ignored the sensational disclosure that Merkel snubbed Obama, when the American president called the German chancellor to discuss the EIH bank.

How does one explain the miserable, non-critical reporting of the mainstream German press?

There seems to be a rock-solid consensus, predominate among German business reporters, not to pen hard-hitting investigative reports showing the unsavory German-Iranian business relationship. There was a 14 percent increase in German exports to Iran during the first half of 2010 over the same period in 2009. But one would hardly hear that from German editorial writers. What, however, they seem to be concerned about are German jobs, the country's role as the world's number two exporter, and continued journalistic access to companies. This has resulted in reporters pooh-poohing the Iranian nuclear threat as limited (falsely) to Israel and not to the European Union.  Recall, it was the Wall Street Journal, an American publication, that broke most of the scandals involving German-Iranian trade and not the Hamburg-based publications, Spiegel magazine, Financial Times Deutschland, and Hamburger Abendblatt.

Germany's foreign minister Guido Westerwelle and his pro-business Free Democratic Party (FDP) are not terribly interested in prioritizing international security over profit gains for mid-size German firms.

The FDP is the party of small businessmen and its voting base relies on many of the German engineering firms active in Iran (and ostensibly connected with the EIH). All of this means that when Westerwelle gave the green light for fellow FDP-member and MP Rainer Stinner to take a trip to Iran in August to strengthen bilateral ties with the rogue nation, at a time when the international community was seeking to isolate Iran's clerical rulers, the writing is plainly on the wall. Germany is engaging in high intensity appeasement with a regime that is moving at an astonishingly fast pace to obtain nuclear weapons.

How can the U.S. influence a change in the Merkel administration's overtly cordial behavior toward Iran? The U.S State Department and Congress have an amazing opportunity to investigate, and when necessary, sanction German firms active in Iran. Take the example of the German engineering and steel giant ThyssenKrupp, in which 4.5 percent of the company's stocks are in the hands of the Iranian government. ThyssenKrupp's activity in Iran's energy sector is likely to be a violation of the Comprehensive Iran Sanctions Accountability and Divestment Act of 2010.

There are no shortage of German engineering firms—including the global company Linde—contributing to sustaining Iran's energy sector and military apparatus.

Plainly, Merkel's efforts to stop Iran's nuclear proliferation and the mullahs' brutal repression of the Iranian pro-democracy movement has to be as important as her defense of Kurt  Westergaard's right to draw and satirize radical Islam .

Benjamin Weinthal is a fellow at the Foundation for Defense of Democracies

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