Iran-Eurasian Economic Union Trade Hits US$330 Million A Month Since FTA Signed Off
Mehdi Mirashrafi, the Head of Islamic Republic of Iran Customs Administration (IRICA) has said that the value of Iran’s share of preferential trade with Eurasian countries has reached US$194.2 million since the trade agreement with the Eurasian Economic Union (EAEU) was implemented on October 27 up to the end of November
According to Mirashafri, the value of Iran’s total (preferential and non-preferential) exports to Eurasia stood at US$137.9 million in the mentioned period, while the total imports reached US$193 million, to give a collective trade figure of US$330.9.
“In the current situation [the U.S. sanctions], the Eurasian countries have a very good potential [for trade] and we need to utilize this capacity to boost our exports and import our needed commodities.” Mirashrafi said.
He also noted that the two sides of the agreement are trying to avoid using dollar in their economic exchanges and use their national currencies or other common currencies like the euro instead.
After several years of negotiations, Iran and EAEU reached a free trade agreement earlier this year and the agreement officially came into force on October 27.
Based on this agreement, about 840 commodity items are subject to preferential tariffs, which means tariffs on some goods are reduced or cancelled, and for some commodities, tariffs are levied.
Iran is a very important market in the region and development of ties with this country is of high significance for the EAEU members.
Signing the free trade agreement between Iran and the EAEU union has laid the ground for the expansion of trade ties between the two sides. The EAEU includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia, and sits in the geographic space between China and the European Union.
Iran’s deputy industry minister, Hossein Modares Khiabani has also said that the value of trade between Iran and the EAEU will rise to trade worth over US$30 billion through the establishment of required infrastructures in banking, insurance, customs and transportation sectors. Iran is already creating the North-South International Transport Corridor, which will link the country via shipping routes to Western India, westwards to Europe and north to Azerbaijan and Russia.
Looking West, the Persian Gulf-Black Sea corridor begins from the Persian Gulf to the south of Iran, heads to the north of the country and then proceeds to Armenia and Azerbaijan, from where it reaches the Georgian ports of Poti and Batumi in the Black Sea. For here, Bulgarian ports also play a role via roll-on/roll-off ships used to get trucks to Greece. Trucks that head to Italy can also depart from southern Greek ports using these kinds of ships. Iran, Armenia, Azerbaijan, Georgia, Bulgaria, Greece and Ukraine have all agreed on a draft communique to proceed.
Russia Briefing is written by Dezan Shira & Associates. The firm has 28 offices throughout Eurasia, including China, Russia, India, and the ASEAN nations, assisting foreign investors into the Eurasian region. Please contact Maria Kotova at email@example.com for Russian investment advisory or assistance with market intelligence, legal, tax and compliance issues throughout Asia.