Germany severed major financial ties with Iran when Commerzbank and Deutsche Bank ended all contracts with Iran, reports Forbes.com.

In spite of the international maelstrom surrounding the nation, Iran is a tantalizing target for Western investment. Forbes.com writes, “Were it not for the sanctions, Iran clearly would have much potential for investment. Imports and exports are growing at 10 percent per year, which is twice as fast as Iran’s gdp growth of 5 percent.”

“Ask any economist which country in the Middle East has the greatest long-term potential,” Global Insight’s Jan Randolph said, “and most will answer Iran.”

The banks gave strictly fiscal reasons for the pullout. According to Deutsche Bank officials, sanctions imposed by U.S. and EU governments on Iran have tipped the balance between labor and profits. Strictly speaking, their investments were not reaping a large enough return. Some believe, however, that the German banks gave in to pressure from the U.S. government to stiffen sanctions against Iran.

Regardless of the reason, the banks’ pullout will probably affect Berlin’s trade relationship with Tehran in a big way. Germany had been one of Iran’s main trading partners. Without banks to finance such trade, the forecast for Iranian-German relationships in this sector is bleak.

Though the waters might have gotten too hot for German banks, Asian financiers are not so queasy. Chinese investors are eager to fill the void left by European banks, and some analysts believe this recent move will give China the upper hand in the future.

Germany distancing itself from Iran is only a precursor to the relations these two nations will have in the near future. To learn more about Iran and Germany, read our booklet The King of the South. To find out more about the role China will play in future events, read Russia and China in Prophecy.