Page 19 - IRANRptMar20
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5.0 External Sector & Trade
5.1 Balance of payments and current account
Iran targets big trade boost with neighbours
Iranian Deputy Industry Minister Hossein Modares Khiabani has said his ministry wants to quickly raise the annual value of exports to Iran’s 15 neighbours to $50bn, Tasnim news agency reported on August 31.
Crucial to that strategy will be taking advantage of a preferential trade agreement due in November to come into effect between Iran and member states of the Moscow-led Eurasian Economic Union (EEU)—namely Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan.
“Our goal is to be able to meet five percent of our neighbouring countries’ needs, which would amount to more than $50 billion a year considering the total imports of all the 15 countries which is at least $1 trillion annually,” Modares Khiabani was reported as saying.
“Necessary planning and investigations have been made for achieving this target,” he added.
Iran shares a border with the United Arab Emirates, Iraq, Turkey, Afghanistan, Pakistan, Russia, Oman, Azerbaijan, Turkmenistan, Kuwait, Qatar, Kazakhstan, Armenia, Bahrain and Saudi Arabia.
Based on data published by Iran’s Trade Promotion Organization (TPO), bilateral trade with these countries stood at more than $36.5bn in the last Iranian calendar year, representing around 41% of the country’s total non-oil trade.
Iran plans to launch 15 mega export projects to identify more target markets, according to TPO’s former acting head, Mohammadreza Modoudi.
Iraq, meanwhile, is often the only or obvious source of raw material imports for Iran given the difficulties Iranian producers are having in importing such items from alternative providers who are intimidated by sanctions.
Iraq imported some $6bn of Iranian goods—from air conditioners to agricultural products to car parts—in the year to March, amounting to around 15% of its overall imports last year. Much of the trade is conducted by private Iraqi companies said to have limited exposure in and to the US, and its financial system, and therefore not overly anxious about being sanctioned.
On November 21, Iran announced that smuggled goods with a value of at least $12bn flowed into and out of Iran during the 2017/2018 Persian calendar year (ended March 21).
19 IRAN Country Report March 2020 www.intellinews.com
