EghtesadOnline: Iran’s total commercial exchanges with Turkey totaled $3.62 billion during the first four months of 2018, registering an increase of 2.11% compared with last year’s corresponding period, according to Turkish Statistical Institute.
Iran exported $2.68 billion to the neighboring country during the four-month period, up by 7.32% year-on-year.
Iran's imports from Turkey during the same period stood at $945.25 million, registering a 10.26% decrease YOY.
As of mid-April, Iran and Turkey started implementing a deal finalized by the two neighboring countries last year to use their national currencies in mutual trade with the first letter of credit being opened by Bank Melli Iran on April 16, Financial Tribune reported.
According to Central Bank of Iran, as part of the agreement to use Iranian rial and Turkish lira between the two countries' central banks, Bank Melli opened the first such L/C to finance Iranian trade with Turkey.
The central banks of Turkey and Iran formally agreed in October to trade in their local currencies. The agreement had been discussed earlier during Iranian President Hassan Rouhani's visit to Turkey followed by a draft agreement between the governors of the two countries' central banks.
Under the deal, the Iranian rial and Turkish lira will be easily converted to help reduce the costs of currency conversion and transfer for traders. The countries had been using euros in the past, as Iran is barred from using the US financial system.
According to the agreement, the central banks of Turkey and Iran have allocated a credit of 5 billion liras ($1.4 billion) and its equivalent in rial to their respective agent banks to be used as letters of credit with a repayment period of one year for both countries' traders.
The CBI has said that the deal would considerably improve banking and trade relations between the two neighbors.
Turkish President Recep Tayyip Erdogan said last year the deal was aimed at raising Turkish-Iranian trade volume to $30 billion.
Following US President Donald Trump's last month announcement that the country was abandoning the nuclear deal signed internationally between Tehran and world powers in 2015, Ankara’s Foreign Ministry Spokesman Hami Aksoy said Turkey will take every initiative to protect its firms from US sanctions.
Earlier, Turkish Deputy Prime Minister Bekir Bozdag stressed that trade relations between Turkey and Iran were legal in international and Turkish laws.
“There is no commercial transaction [between Iran and Turkey] that is against national and international laws. It is definitely not possible to make [such a transaction],” said Bozdag, who is also the Turkish government’s spokesman at a news conference in Ankara on Sept. 11.
Iran and Turkey have a preferential trade agreement in place. It was signed in 2014 and took effect in 2015.