EghtesadOnline: Export companies have refused to return $27 billion in overseas earnings in the past two years and the government is struggling to bring the money back by resorting to a mix of pliability and penalty.
Masoud Khansari, head of the Tehran Chamber of Commerce, Industries, Mines and Agriculture said the chamber along with representatives from the Central Bank of Iran have met several times with more than 90 exporting companies in the past two weeks to resolve the problem.
“Meetings have been held in collaboration with the central bank. We have assessed the challenges and identified the root causes,” he was quoted as saying by the TCCIM website.
Regarding the marathon meetings, Khansari narrowed down reasons for exporters’ failure to repatriate earnings to three:
-discord among administrative bodies over how best to handle the issue
-lack of an integrated information platform accessible to all
-exporters’ obliviousness about multiple guidelines and bylaws issued by government bodies, which at times overlapp and violate one another leading to confusion.
Samad Karimi, head of the Central Bank of Iran’s Export Department said earlier that the government is trying to find a compromise with exporters with the highest defaults.
He said the CBI is focused on 2,386 companies with export value of above €1 million each but repatriated less than 70% (between zero to 70%) of their earnings. The value of goods sent out by this group was €24 billion while only €6.4 billion came back.
“In short, these exporters failed to repatriate €17.7 billion,” he was quoted as saying by the CBI’s public relations office.
Economic and monetary policymakers give importance to this group of exporters considering their role in the currency market matrix, he said. The government will come to “some compromise” with them, Karimi said without elaboration.
“Efforts will be made to reach a compromise and relevant supervisory bodies will [encourage them to] return their earnings in the entirety to improve access to forex in the secondary market.”
The secondary market is a trade platform known locally as Nima (Integrated Foreign Exchange Deals System) where exporters sell their proceeds and import companies buy. Shortage of currency in this market has been particularly blamed for the steep hike in currency rates in the past several months.
While the government tries to find some compromise formula for the major defaulting companies, it also is getting tough with unruly exporters to oblige them to play by the rules or face the consequences.
Mohammad Ali Esfanani, head of Tehran’s Ta’zirat Organization, said Tuesday that tough penalties have been imposed on 1,580 exporters who refused to repatriate their forex earnings.
Ta’zirat is a general inspectorate affiliated to the judiciary.
He said more than 2,300 cases have been filed with the Tazirat in the past year alone, of which 1,580 are being studied.
Penalties include suspension of commercial cards, closure of bank accounts, travel bans on defaulters and impounding goods in the customs warehouses, IBENA reported.
Due to the punitive measures, exporters returned €38 million, $84 million, 13 million UAE dirhams, 1 million Turkish lira, 53 million Chinese yuan, one billion Russian rouble and one billion South Korean won.
Karimi said the CBI has sent a list of 250 companies that failed to return their earnings amounting to €6.8 billion ($7.6 billion) to the judicial authorities.