Encouraging trade with Iran is 'crucial' says EU

The European Union foreign policy chief Federica Mogherini said the EU is encouraging enterprises to increase their business with Iran, as that country has been compliant with its nuclear-related commitments.

Mogherini told reporters on Tuesday during her trip to Wellington, New Zealand, that it's up to Europeans to decide who they want to trade with.

"We are doing our best to keep Iran in the deal, to keep Iran benefiting from the economic benefits that the agreement brings to the people of Iran because we believe this is in the security interests of not only our region, but also of the world. If there is one piece of international agreements on nuclear non-proliferation that is delivering, it has to be maintained," Mogherini said.

Washington re-imposed stiff economic sanctions on Iran on Tuesday, ratcheting up pressure on the Islamic Republic despite statements of deep dismay from European allies, three months after President Donald Trump pulled the US out of the international accord limiting Iran's nuclear activities.

Trump declared the landmark 2015 agreement had been "horrible," claiming it left the Iranian government flush with cash to fuel conflict in the Middle East.

Iran accused the US of reneging on the nuclear agreement, signed by the Obama administration, and of causing recent Iranian economic unrest.

European allies said they "deeply regret" the US action.

Trump said in a statement: "We urge all nations to take such steps to make clear that the Iranian regime faces a choice: either change its threatening, destabilising behavior and reintegrate with the global economy, or continue down a path of economic isolation."

A first set of re-imposed US sanctions affect financial transactions that involve US dollars, Iran's automotive sector, the purchase of commercial planes and metals including gold.

A second batch of US sanctions targeting Iran's oil sector and central bank are to be re-imposed in early November.

Trump warned that those who don't wind down their economic ties to Iran "risk severe consequences".

European ministers said the Iran deal was crucial for Europe's and the world's security, and the European Union issued a "blocking statute" Monday to protect European businesses from the impact of the sanctions.

Mogherini, speaking at a news conference alongside New Zealand Foreign Minister Winston Peters, said the EU and New Zealand saw the need to maintain the nuclear deal with Iran, notwithstanding the US withdrawal, and that she and Peters had discussed in detail how to keep open trade and financial channels with Iran.

"We are encouraging small and medium enterprises in particular to increase business with and in Iran as part of something (that) for us is a security priority," Mogherini said, explaining that trade is an integral part of the nuclear deal.

Trade between Iran and the EU "is a fundamental aspect of the Iranian right to have an economic advantage in exchange for what they have done so far, which is being compliant with all their nuclear-related commitments," Mogherini said.