EghtesadOnline: Central Bank of Iran's new forex policy has helped calm various markets in Iran, including the tumultuous mobile phone market, as reports point to a drop in prices as much as 10%.
The mobile phone market has reacted positively to the end of the government's overregulation of the forex market, as witnessed in its impact on the cellphone prices in the past 72 hours, reported ICTNA.
High-end handsets such as iPhone X have seen a 10.8% slip in their price; and the fabled Apple smartphone has come down from 148 million rials ($3,520) to 132 million rials ($3,140).
Mid-range products have also observed a similar decline in their prices. The Samsung A5's cost has eased from 30 million rials ($714) to 27 million rials ($642), down 10% from just a few days ago, Financial Tribune reported.
According to local sources, there seems to be an average 10% fall in mobile phone prices. Iran's mobile phone market is over-dependent on the foreign currency rate as all handsets are imported into the country.
While the recent price drops have not yet made up for the raging inflation in the past few months, it has to some extent calmed down the volatile market.
The latest market trend stems from the recent forex policy pursued by the new governor of the CBI, Abdolnasser Hemmati, who is actively trying to undo his predecessor's legacy of monetary policy mistakes.
>Catalogue of Errors
Following US President Donald Trump's withdrawal from the historic 2015 Iran nuclear deal, the dollar exchange rate hit unprecedented highs, propelling the government of President Hassan Rouhani to unify the rate at 42,000 rials in an abrupt attempt to impose their will on a bullish market paralyzed by an excessive demand for the greenback.
Moreover, officials established the Forex Deals Integrated System, locally known as Nima, as a platform for importers to declare their currency needs, which in practice bottlenecked the supply chain of a wide range of commodities and drove prices to highs never experienced before.
The defective policy rattled the markets and created widespread economic tension in the country. Hemmati's strategy to allow supply and demand set the USD exchange rate has been so far moderately successful in soothing markets.
One of the defects of the system was that Nima let a handful of people decide who is entitled to government-allocated subsidized currency, which was a welcome sign to racketeering practices by opportunists.
Following public outrage over the scarcity of mobile phones in the market, the ICT Ministry stepped in to promote transparency by releasing the name of companies which had been allocated 42,000-rial dollars.
According to the list, 40 importers had received €118 million, 30 of which used €75 million to bring mobile phones into the country. Out of the 40, three did not violate the law, four have not yet released the goods from the customs warehouses, and 24 either hoarded the mobile phones or ripped off buyers for them.
A number of the aforementioned companies have been charged with wrongdoing and the remaining are currently under investigation.
Furthermore, 600,000 mobile phones were confiscated from companies which were selling the devices at exorbitant prices and will soon be redistributed in the market to further put in check the raging inflation which has given rise to a lingering stagnation in the once-prosperous market.
Corruption seems to run deep among mobile phone market insiders as news on misconduct keep on emerging.
The implementation of a scheme dubbed the Registry Scheme, which cut off smuggled mobile phones from the country's network, has been incapacitated by the unscrupulous few who have managed to circumvent a database which was supposed to identify smuggled handsets.
For implementing the scheme, local authorities use an online database named Hamta of the IMEI, or the International Mobile Equipment Identity. IMEI is a unique number—like a fingerprint for electronic devices—that helps identify a mobile phone.
While previously the database was deemed incorruptible, officials overseeing Hamta have reported that several people have managed to forge the IMEI numbers and sell smuggled phones to customers.
Hamta's statement reads, "Forging the IMEI number is prosecutable by law and culprits can be sentenced to imprisonment from one to five years or face a fine of 20 million rials to 100 million rials [$476-2,380]."
It is not clear whether Hamta's punitive measures can function as a deterrent for avaricious traders.