Page 19 - IRANRptMay20

Trade between Iran and Turkey sinks 57% in January
Iran’s bilateral trade with Turkey officially declined by 57.23% y/y to $335.7mn (at the unofficial exchange rate) in January, Tehran’s ​Financial Tribune​ has reported, citing Turkish Statistical Institute (TUIK) data.
Iran exported $118.47mn worth of goods to Turkey, marking a 78.94% y/y decline, while Turkey exported $217.23mn of goods to Iran, a figure that was down 2.25% y/y, according to the Turkish agency.
Iran was recorded as the 18th biggest export destination for Turkey and the 32nd biggest exporter of goods to Turkey in January.
The extent of the impact of US sanctions on trade between Turkey and Iran is unknown but must be substantial. In January last year, the US was yet to adopt its policy of attempting to drive all Iranian oil exports off world markets. Turkey, short of its own energy resources, has long been a customer for oil from its neighbour.
When they arrive, the figures for trade between the two countries in February could be far worse than the January data given the substantial coronavirus outbreak in Iran which has caused Turkey to in the past week suspend a huge amount of trade with Iranian counter-parties. Turkish Airlines, meanwhile, has halted all flights to and from Iran until further notice.
5.1.3​Gross international reserves
Iran’s gold Imami sovereign breaks IRR25mn barrier amid dwindling hard currency supplies
CBI has over €70bn in hard currency reserves
Iran’s gold sovereign of choice, the Imami, has again broken the IRR25mn barrier as buyers continue to purchase remaining stocks of the officially minted 18-carat coin, IBENA reported on June 18.
Iranians’ attraction to gold as a safe haven has intensified with hard currency supplies dwindling in Iran following legal changes suddenly brought in in early April to arrest the stark descent of the Iranian rial (IRR), hit by souring sentiment over Iran’s economic prospects in the face of hostility from the US Trump administration. The move banned open market trading of foreign exchange and made unofficial rates illegal.
In early May, a World Gold Council report said that​ ​gold coin and bar demand in Iran shot up to a three-year high of 9.3 tonnes​ ​in the first quarter as Iranians —correctly—anticipated that the consequences of deteriorating relations with the US would cause Tehran to introduce currency controls.
The Azadi gold coin, the former number one sovereign sold by the Central Bank of Iran (CBI), also reached a historic high on June 18, topping IRR24mn a coin, while smaller half-sovereigns increased in price accordingly.
According to the IMF in its Regional Economic Outlook on May 4, the value of Iran’s gross official reserves was estimated to reach $108.4bn in 2018.​The country’s gross official reserves will experience a $13.3bn jump in the current year rising from last year’s $95.1bn.
The Central Bank of Iran (CBI) has more than €70bn in hard currency reserves, according to the National Development Fund of Iran (NDFI). However, as restrictions continue on trade and withdrawal of cash from forex reserves, the country is looking for ways to find new revenues of hard currency.
19​ IRAN Country Report May 2020 www.intellinews.com