EghtesadOnline: Iran’s exports to the neighboring country Iraq have been on the decline since the last Iranian month (June 22-July 22), says secretary-general of Iran-Iraq Chamber of Commerce.
Hamid Hosseini added that the downward trend is rooted in several factors, including the gradual appreciation of Iran's national currency, summertime heat and the government’s pressure on exporters to repatriate their earnings.
By the end of last Iranian year (March 19, 2019), the Iranian rial had lost about two-thirds of its value against the dollar, but regained some of the lost ground, which implies that exporters' earnings have slightly diminished.
Amid dwindling currency reserves as a result of reimposed US sanctions aimed at choking Iran's oil exports, the government issued a directive requiring exporters to return their export earnings to the Central Bank of Iran at an exchange rate set below market prices. This raised domestic exporters’ complaint as the move means less earning, much to their discouragement, according to Financial Tribune.
According to the official, political developments in Iraq have also impacted Iran’s exports to Iraq.
"Statistics from border terminals and truck movements indicate exports to Iraq during the current [Iranian] month (July 23-Aug. 22) have also been slower than in the previous month," he was quoted as saying by Fars News Agency.
There are no precise figures about Iran's trade with Iraq and other countries, as the Islamic Republic of Iran Customs Administration has stopped releasing statistics on Iran's commercial exchanges in the past couple of months.
"IRICA ceases to release data as soon as there's decline in trade," Hosseini said.
Last year's (March 2018-19) data show 19.84 million tons of non-oil goods worth $9.01 billion were traded between Iran and Iraq to register a 48.25% and 35.75% growth in tonnage and value respectively compared to the year before.
Iran exported 19.76 million tons of goods worth $8.96 billion to Iraq, up by 49.15% and 36.71% in tonnage and value respectively year-on-year.
Iraq was Iran’s second export destination after China, during the 12 months.
Iran’s exports to Iraq included liquefied natural gas, mineral oils, household cleaning detergents, low-density oils and tomatoes.
The country imported 73,563 tons of commodities worth $58.69 million from Iraq, down 43.14% and 34.61% in tonnage and value respectively YOY, a majority of which were low-density oil, machinery, aluminum alloy and cans.
Iraq was the 41st exporter to Iran in the world.
According to Minister of Industries, Mining and Trade Reza Rahmani, Iran was the biggest exporter to Iraq last year.
"This is the first time Iran tops the list of exporters to neighboring Iraq … We need to keep this status using our full potential, as our rivals Turkey and China trail closely behind the Islamic Republic," the minister was quoted as saying by IRNA.
With more than $1.93 billion, Iraq was also the biggest importer of Iran's mineral products last year.
According to data released by the Iranian Mines & Mining Industries Development & Renovation, known as IMIDRO, a total of more than 9.67 million tons of mineral products were exported from Iran to the neighboring country last year.
According to the secretary-general of Iran-Iraq Chamber of Commerce, Iran's mineral exports to Iraq last year mainly included non-precious metals worth $1.13 billion, which experienced an over 50% rise compared with the year before.
More specifically, the bulk of exports included steel products worth more than $1 billion as well as copper products worth $71 million.
Earlier this month, Hosseini said Iran exported $2.5 billion worth of commodities and services to neighboring Iraq during the 100 days to July 1, registering an increase of 20% compared with last year’s corresponding period.
“An average of $250 million was exported to the neighboring country on a daily basis,” he said.
Hosseini provided the statistics during the Iran-Iraq Commercial Forum held at Iran Chamber of Commerce, Industries, Mines and Agriculture on July 6.
President of Iran-Iraq Chamber of Commerce Yahya Al-e Es’haq, who was also present in the forum, said Iran’s trade with Iraq is tenfold more than with the whole Europe.