BASF SE Chief Executive Officer Kurt Bock plans to rebuild the business of the world’s biggest chemical maker in Iran, saying a visit to the country this week showed him the market potential for German companies.
“German technology, German quality work and German reliability are very highly regarded and so we see good chances to tie again into old developments,” the CEO, who was part of a delegation that traveled to Iran with Economy Minister Sigmar Gabriel, said on a conference call Friday.
BASF could do with orders from new markets after the German chemical company reported second-quarter profit that missed analyst estimates as the slump in the oil market forced it to cut prices. Iran has the second-biggest natural gas reserves, the fourth-biggest oil reserves, and a developing petrochemical industry, which will have an impact when Iran is more strongly integrated into the world economy, Bock said.
The German government plans to be Europe’s vanguard in reviving economic ties with Iran when U.S. and European sanctions end early next year after an accord was brokered for the peaceful development of nuclear technology.
While BASF adhered very exactly to sanctions, the Ludwigshafen, Germany-based chemical maker retained a small team in the country, Bock said, adding that the company had been doing business in Iran since 1959.
The world’s largest chemical maker, whose Wintershall unit resumed oil production in Libya in February, said today that it’s become “more challenging” to meet its target of 2015 earnings that match last year’s.
The company cut its growth expectations for global gross domestic product to 2.4 percent instead of a previously predicted 2.8 percent. The stock dropped as much as 4.4 percent, valuing the company at 74 billion euros.
A group of German industrialists and scientists joined Gabriel on his visit this week, his ministry said, without identifying any of them. Bilateral German-Iranian trade reached 8 billion euros ($8.7 billion) annually in 2003 and 2004 before sanctions and dropped to 2.1 billion euros in 2013, according to the website of the German-Iranian chamber of commerce.
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