Page 43 - IRANRptNov18

9.1.6 Retail sector news
Home appliances, cosmetics, packaged food and auto parts were the goods most smuggled into Iran in terms of value in the sixth month of the current Persian calendar year (ended September 22), according to an Iranian Consumer Protection Agency report cited by ILNA on October 10. Smuggling of goods into Iran has spiked in recent months due to the inability or unwillingness of IRICA to release products held in customs yards across the country amid the collapse in value of the Iranian rial (IRR), which has lost towards 70% of its value against the dollar in the year to date.
The new details on rife smuggling formed part of a report published by the Ministry of Industry, Mines and Trade on the previous month, following criticism of officials at the ministry that they were not pulling their weight in efforts to clamp down on the black economy.
Some 28,325 inspections were conducted on the supply side with goods worth more than IRR5,127bn ($34.1mn at the free market rate) and 606 individuals and enterprises identified in advance of expected court cases.
The home appliances identified as smuggled had a worth of IRR3,006bn. The figure for the cosmetics was IRR1,904bn, foodstuffs IRR103bn, auto parts IRR60bn and cigarettes, tobacco and tobacco products IRR33bn.
9.1.7 Fast moving consumer goods sector news
The prices of imported fast moving consumer goods (FMCG) currently on shelves in Iran can be legally increased by a maximum of 17%, according to an interpretation of new rules given by Ali Avazpour, the managing director of the Chamber of Guilds of Iran, Mehr News reported on July 18. The price tags faced by consumers of imported goods on both legitimate and black markets have fluctuated at unprecedented rates in recent weeks given wild swings in the value of the collapsed Iranian rial (IRR).
The announced 17%-maximum applies to both retailers and wholesalers. However, many traders will likely ignore the warning as, unlike in the case of domestically produced products, prices on imported items are not printed on packaging. Avazpour reportedly further advised that any price rises for imported goods going beyond the given threshold would be dealt with via legal action undertaken by the General Inspection Organization (GIO), an ombudsman linked to the Judiciary of Iran.
Iranian importers of foodstuffs have been left in a difficult position in recent months because they have no entitlement to accessing the official government rial-to-the-dollar rate of IRR42,000. This has pushed such importers to secure items at negotiated exchange rates around double the official rate.
Azerbaijani confectionery maker Ulduz has announced planned sales expansions into the Iranian and Belarusian markets, Trend News Agency reported on October 23. Ulduz presently sells its sweet treats in countries including Georgia, Russia and Turkmenistan. The Iranian market might prove more challenging than those markets given the sizeable local chocolate industry as well as the presence of established foreign brands from Europe. "We are currently working with Ukraine, Malaysia, Israel and Saudi Arabia. Our products are also represented in Iraq. And we are currently negotiating with Iran to start exports to that country. Taking into account not only the high demand but also convenient transport route [from neighbouring Azerbaijan], the Iranian market is quite promising. In parallel, we are also negotiating with Belarus to export chocolate there. As for cooperation with Russia, we are
43 IRAN Country Report November 2018 www.intellinews.com