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Iran targets big trade boost with neighbours
of unnecessary imports.
He added: "Despite restrictions caused by the ​outbreak of COVID-19​, exporters have managed to inject $2.5 billion into the secondary market in the past 50 days... Our observation indicates that the market is going to return to its previous state as trade channels reopen.”
The central bank chief did not refer, however, to an ever-present worry on officials’ minds, namely the parlous state of the Iranian rial (IRR). It has recently suffered another bout of depreciation with very modest strengthening in recent days. On the unofficial market, it was trading at IRR178,000 versus the dollar on May 20. By May 29, it had gained to IRR176,000, according to Bonbast.com, a website banned in Iran.
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.
Crucial to that strategy will be taking advantage of a preferential trade agreement that came into effect in November 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.
5.1.1 ​current account dynamics
Iran current account, USD mn
2011
2012
2013
2014
2015
2016
2017
2018
Balance of payments overall
-947
21,436
12,213
13,189
8,561
2,233
Current account balance
27,554
58,507
23,362
25,105
15,861
1,237
16,388
15,816
Current account balance: % of GDP
5.66
10.08
3.87
5.43
3.12
0.32
3.92
Total Exports
130,500
95,500
82,000
88,800
63,000
Total Imports
62,661
59,999
51,914
48,138
52,007
40,097
41,945
54,459
Trade Balance
68,692
42,049
32,291
35,231
20,5000
Source: CEIC, Central Bank of Iran
21​ IRAN Country Report July 2020 www.intellinews.com