10% Monthly Decline in Iran's Non-Oil Foreign Trade

(Sunday, September 8, 2019) 11:39

Iran’s non-oil trade with other countries during the one-month period ending Aug. 22, which marks the end of the fifth Iranian month (Aug. 22), stood at $6.6 billion, indicating a decline of 10.7% compared with the same month of last year.

Non-oil exports amounted to $3.2 billion for the month, indicating a rise of 3.2% month-on-month, but a decline of 16% year-on-year.  

Imports stood at $3.4 billion to register a decrease of 15% month MOM and 8.1% YOY, IRIB News reported citing data released by Economic Research Department of Tehran Chamber of Commerce, Industries, Mines and Agriculture. 

Iran's overall non-oil foreign trade (except crude oil, mazut, kerosene and exports via suitcase trade) during the five months stood at $35.53 billion, the Islamic Republic of Iran Customs Administration reported.

Compared with $38.2 billion registered for last year's corresponding period, the new trade data shows a 7% decline. 

Iran’s exports stood at 60.73 million tons worth $17.8 billion during the period to register a 29.86% growth in weight but a 9.14% decrease in value compared with the same period of last year. 

Imports hit 14.12 million tons worth $17.73 billion during the same period, indicating a decline of 0.11% in weight and 6.83% in value YOY.

The above figures show the country recorded a non-oil trade surplus worth $70 million. 

China, Iraq, Turkey, the UAE and Afghanistan were Iran’s main export destinations over the period. 

Exports to China stood at $4.43 billion, constituting 24.91% of Iran's total exports. 

Iraq imported $3.9 billion worth of non-oil goods from Iran and accounted for 21.95% of Iran’s overall exports.

Exports to Turkey stuck around $2.47 billion to account for 13.88% of Iran’s total exports. 

Non-oil goods sold to the UAE were worth $1.66 billion (9.36% of Iran’s overall exports). 

Exports to Afghanistan reached $898 million. The neighbor to the east accounted for 5.04% of Iran’s total exports during the period under review.   

Top exporters to Iran during the five months to Aug. 22 were China with $4.28 billion and a share of 24.16% from Iran’s total imports; the UAE with $3.04 billion and a share of 17.13%, Turkey with $2.21 billion and a share of 12.51%, India with $1.87 billion and a share of 10.55% and Germany with $865 million and a share of 4.88%.

By “non-oil”, IRICA refers to all commodities, except crude oil. Therefore, oil-driven products and byproducts, as well as petrochemical products, are still categorized under non-oil.  

IRICA categorizes non-oil exports into three groups of “petrochemicals”, “gas condensates” and “others”.

The decline in trade comes, as the United States unilaterally walked out of the 2015 nuclear deal last year and reimposed a series of sanctions described as "toughest ever" against the Islamic Republic with the aim of choking off Iran's trade, particularly of oil, by obstructing banking transactions and scaring off Iran’s trading partners.

The deal, better known as Joint Comprehensive Plan of Action, saw the removal of international sanctions against Iran. In exchange, the country agreed to limit the scope of its nuclear program.

The return of sanctions wreaked havoc in the Iranian economy after an initial boost as a result of JCPOA and its implementation in 2016. As a result, the Iranian government adopted ad-hoc trade policies to cushion the effect of sanctions.

One such measure was to ban the import of a wide range of goods as of last year with the primary aim of economizing on foreign currency reserves. The measure essentially pertains to commodities that are produced domestically.