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Europe moves to safeguard Iran interests after US pullout

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British Prime Minister Theresa May (C), German Chancellor Angela Merkel (R) and French President Emmanuel Macron (L) give a press conference following a meeting on the sidelines of the European Union leaders summit in Brussels, on March 22, 2018.

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British Prime Minister Theresa May (C), German Chancellor Angela Merkel (R) and French President Emmanuel Macron (L) give a press conference following a meeting on the sidelines of the European Union leaders summit in Brussels, on March 22, 2018.

Europe’s heavyweight economies took steps on Friday to safeguard their commercial and political interests in Iran, seeking to keep the nuclear deal with Tehran alive after Washington pulled out and said sanctions would follow.

Germany, France have significant trade links with Iran and remain committed to the nuclear agreement, as does Britain, and all three countries’ foreign ministers plan to meet on Tuesday to discuss it.

That is part of a flurry of diplomatic activity lined up following Tuesday’s unilateral withdrawal from what U.S. President Donald Trump called “a horrible, one-sided deal”, a move accompanied by the threat of penalties against any foreign firms doing business in Iran.

German Chancellor Angela Merkel said possibilities to save the deal without Washington needed to be discussed with Tehran, while France’s Finance Minister Bruno Le Maire said EU states would propose sanctions-blocking measures to the European Commission.

“There is a realisation among all European states what we cannot keep going in the direction we are headed today whereby we submit to American decisions,” Le Maire told reporters in Paris.

In Berlin, Economy Minister Peter Altmaier said Germany was ready to give help to its affected firms, including legal advice, to continue doing business in Iran.

Foreign Minister Heiko Maas said transatlantic ties had been gradually damaged by shifts in U.S. policy. “We are prepared to talk… but also to fight for our positions where necessary,” he told Der Spiegel magazine.

Europeans fear a collapse of the nuclear deal could raise the risk of deepening conflicts in the Middle East.

Germany, France and Britain want talks to be held in a broader format on Iran’s ballistic missile programme and its regional military activities, including in Syria and Yemen.

“The extent to which we can keep this deal alive …is something we need to discuss with Iran,” said Merkel, who earlier spoke with Russian President Vladimir Putin on the issue.

Divisions in Iran over what should happen next were illustrated as senior cleric Ayatollah Ahmad Khatami told worshippers at Tehran University on Friday that European nations could not be trusted.

President Hassan Rouhani had said on Tuesday that Tehran would remain in the deal, provided its benefits stayed in force under its remaining signatories.

Iran’s foreign minister will travel to Moscow on May 14 and meet his Russian counterpart, Russia’s RIA news agency said, citing a Russian foreign ministry official.

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Eurozone Flash PMIs January 2020: Business activity shrinks again

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A man over 75 years receives a coronavirus (Covid-19) vaccine shot in Strasbourg, France.

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LONDON — Business activity in the euro zone fell to a two-month low in January, preliminary data showed on Friday, on the back of stricter coronavirus-related lockdowns.

The region is grappling with growing Covid-19 infection rates and tighter restrictions as new strains of the virus spread, causing further economic pain.

Markit’s flash composite PMI for the euro zone, which looks at activity across both manufacturing and services, dropped to 47.5 January, versus 49.1 in December. A reading below 50 represents a contraction in activity.

Chris Williamson, chief business economist at IHS Markit, said a double-dip recession for the euro zone was looking “increasingly inevitable.”

“Tighter COVID19 restrictions took a further toll on businesses in January,” he said in a statement.

“Output fell at an increased rate, led by worsening conditions in the service sector and a weakening of manufacturing growth to the lowest seen so far in the sector’s seven-month recovery.”

European Central Bank President Christine Lagarde acknowledged on Thursday that the pandemic still posed “serious risks” to the euro zone economy.

In addition to the new Covid variants, there are also concerns over a slow vaccination roll-out across the European Union.

“In this environment ample monetary stimulus remains essential,” Lagarde said. The ECB decided at a meeting on Thursday to keep interest rates and its wider stimulus programs unchanged for now, having boosted its support in December.

The ECB expects the euro zone’s GDP (gross domestic product) to expand by 3.9% in 2021, and 2.1% in 2022. This is after a contraction of 7.3% last year. However, these forecasts are dependent on the evolution of the pandemic.

France hires more

Earlier, France’s business activity data also came in at a two-month low, reflecting the imposition of stricter curfews across the country. The country’s composite PMI for January was 47, making a contraction.

However, French businesses hired more employees in January — the first increase in job figures in almost a year.

“The fact that firms have returned to recruitment activity points to some confidence in an economic recovery in the second half of this year,” Eliot Kerr, economist at IHS Markit said, in a statement.

In Germany, business activity managed to grow slightly in January, with the flash composite output index coming in at 50.8. However, the reading represented a seven-month low for Europe’s economic engine.

Phil Smith, associate director at IHS Markit, highlighted a slower momentum in manufacturing activity in the country, and a continued hit to the services sector during January.

“All in all, the German economy has made a slow start to the year, and the extension of the current containment measures until at least mid-February means this looks like being the picture for several more weeks to come,” he said.

The German government decided some days ago to extend the national lockdown until Feb. 14.

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Wellness expert Deepak Chopra wants Biden to rethink health care

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