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She made the remarks in a joint press conference with Prime Minister of China Li Keqiang.
Merkel added that although sanctions may lead to exit of a number of European companies from Iran, Germany will remain committed to Joint Comprehensive Plan of Action (JCPOA).
She underlined that although nuclear deal of 2015 with Iran is not an ideal agreement, other options would not be sustainable .
During the press conference the two sides underlined expansion of bilateral relations.
Elsewhere in her remarks, Merkel who is on a 2-day visit to China, also said that Berlin supports Beijing's investments in Germany.
She welcomed recent Chinese policies of supporting foreign investments and said that the two countries may launch joint venture projects in auto-making projects.
Li Keqiang said in the press conference that Beijing welcomes German companies' presence in China and protects their investments.
He said that there are plenty of potentials for cooperation between China and Germany.
US President Donald Trump announced US exit from JCPOA on May 8, 2018.
The move faced with a wide range of criticism from other parties to the nuclear deal such as China, Germany, France and Britain that said they would remain committed to the deal.
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