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Boeing, GE Iran contracts face new uncertainties

A Boeing 777 in KLM livery on the assembly line at the Boeing plant in Everett, Washington, in 2012
STEPHEN BRASHEAR (GETTY IMAGES NORTH AMERICA/AFP/File)

Large contracts for Boeing and General Electric in Iran, while not under direct threat, face significant new uncertainties following President Donald Trump's announcement Friday, said two people familiar with the matter.

Trump stopped short Friday of killing the landmark 2015 agreement -- which curbed Iran's nuclear program in return for sanctions relief -- but he withdrew official support for the agreement and threw its prospects into grave doubt.

Trump's move shifts the fate of the deal to Congress, which is expected to determine the future of the agreement within 60 days, said the two people.

The US could leave the Iran deal "at any time," Trump warned.

If Congress doesn't act, Boeing and GE will be able to keep operating in Iran under a process closely regulated by the Office of Foreign Asset Control in the Treasury Department.

Officials from the two US companies were girding for a period of uncertainty.

"We expect to be in a wait-and-see situation," said an official with one of the companies. 

Spokesman Tim Neale said Boeing would "follow the US government's lead in all our dealings with approved Iranian airlines and will remain in close touch with US regulators for any additional guidance."

"GE and our foreign subsidiaries are pursuing commercial opportunities in Iran consistent with and in compliance with US government rules and policies," said a GE spokesman.

In December 2016, Boeing signed a contract to sell 80 planes for $16.6 billion to Iran Air. 

That was followed in April by an announcement that Boeing would deliver 30 737 MAX planes to Iranian company Aseman in a $3 billion contract for delivery between 2022 and 2024.

GE's non-US affiliates reached agreements to sell equipment and technologies to the Iran energy sector for $20 million in the second quarter, the company said in a July securities filing.

Those contracts became possible under the 2015 agreement between Iran and major powers that eased some international sanctions, even as the US kept an embargo on Iranian investments by Americans and entities using the US financial systems.

(AFP)

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