The effect of the US pulling out of the Iran nuclear agreement will not only reverberate in Iran. US companies will also feel the bite of newly imposed economic sanctions on the regime of Ali Khamenei, Iran’s Supreme Leader.
The US withdrawal from the agreement will force the US government to revoke existing licenses allowing for US companies to do business with Iran. Treasury Secretary Steven Mnuchin said on Tuesday that licenses held by Boeing Company and Airbus Group, Boeing’s European competitor, will be nullified by the US withdrawal from the agreement.
“The existing licenses will be revoked,” Mnuchin said to reporters.
The company responded by saying it will consult with the government on what their next move should be.
“As we have throughout this process, we’ll continue to follow the U.S. government’s lead,” Boeing commented.
Airbus is also dependent on licensing from the US to sell its airplanes to Iran due to the US-made parts Airbus uses in its aircraft.
There will be waivers and exemptions made under certain conditions for certain products and countries, but those conditions were not discussed by Mnuchin.
Mnuchin added that the new sanctions will also seriously limit the sale of oil by Iran, which sells about 5 percent of the world’s oil, making it the fifth largest oil producer in the world. He said that there will be a 6-month grace period to allow countries to finish up existing contracts and implement “significant reductions” in the amount of crude oil they purchase from Iran.
The secretary said he does not believe the price of oil will rise by much since he expects other countries will respond to the new sanctions with increased oil production.
Mnuchin said that the goal of the new sanctions is to force Iran to come to the table to renegotiate the Iran nuclear deal.
Several companies announced business deals worth $250 billion between the United States and China in conjunction with President Donald Trump’s recent Asia tour.
One of the more prominent deals was forged with Boeing. The aerospace giant forged a deal worth $37 billion in sales of planes to the communist behemoth. It was not made clear if this deal is part of a previous announcement from Boeing to sell hundreds of jets to yet unrevealed buyers.
General Electric was also able to forge three separate deals in China valued at a total of $3.5 billion. In addition, Qualcomm was in discussions with Xiaomi, Oppo and Vivo to purchase about $12 billion worth of semiconductors. Ford Motor Company will be investing $756 million in a joint venture with its Chinese partner Anhui Zotye Automobil to manufacture electric cars. This deal was already announced in August this year.
Some of the deals announced on Thursday have been in negotiations for a while, while other deals are only in the early stages, and the outcomes are far from assured.
Other deals in the works with China and US business include:
• A $83.7 billion investment by the China Energy Investment Corporation Limited in several shale gas and chemical manufacturing projects in West Virginia.
• Chinese state-run oil producer Sinopec has agreed to help develop Alaska’s liquefied natural gas sector. The deal, worth about $43 billion, is between Sinopec, the Bank of China and the China Investment Corp. It is estimated that about 12,000 jobs will be created during the construction of project.
• Chinese importers agreed to buy $5 billion worth of soybeans from US producers during 2018.
• Chinese e-commerce company JD.com said it will purchase $2 billion in food and agriculture products over the coming three years from the US, including $1.2 billion in Montana beef and Smithfield Foods pork.
When two Boeing 787s and the first Airbus SAS A380 arrive in England later this month British Airways will become the first European airline to fly the two wide-bodied liners as part of its line-up of planes.
The Boeing 787s are due to join British Airways (IAG) in two weeks on June 26th and 27th, and the Airbus one week later, on July 4th. IAG is spending 5 million pounds ($7.8 million) upgrading its subsidiary’s fleet.
The Dreamliners were originally scheduled to arrive in the UK in May, but due to issues with the batteries Boeing had to delay deliveries until the problems were resolved. British Air said that the routes of the planes will be “unveiled shortly.” But they did confirm that the A380 will have the route to Los Angeles beginning on October 15, while another route will be added to Hong Kong on November 15.
“Over the next 12 months, we will take delivery of new long-haul aircraft at an average rate of one every two weeks,” BA Chief Executive Officer Keith Williams said.
The A380 is more fuel efficient, and the 787 is made of composite plastic, making both planes more environmentally friendly while also helping to keep costs to a minimum. The more expensive-to-operate Boeing 747-400 jumbos will be phased out as more up-to-date planes join the fleet.
An updated forecast predicts that the economy in Kansas is heading up in 2012, but not as quickly as what had first been expected.
According to the Center for Economic Development and Business Research at Wichita State University, the forecast for employment for the Wichita metropolitan area, as well as the state as a whole, will be lower than the previous outlook. The center says that slower national growth in general and lack of confidence in the local and global economy downgraded the forecast.
“This is due to the weakness within the euro zone, remaining uncertainty of the U.S. economy and expectations of the Boeing departure,” said Jeremy Hill, the center’s director.
The revised expectation is that the Kansas economy will grow slowly. The unemployment rate should improve by 1%, translating into 13.010 new jobs, down from the 1.1% original prediction which was made in October last year.
“The Kansas economy has been flat in 2011, showing almost no growth from 2010 to 2011,” Hill said. “However, farmers and farm income have been the stabilizing force in our economy.”
Although Kansas is indeed expected to have an upturn in its economy and unemployment figures, the growth is slower than originally forecast due in large measure to the news that Boeing, the aircraft manufacturer, will be closing its facility in the area.