The ban on imports of cosmetics and toiletries has killed 8,000 jobs since last year and is bound to cost the economy thousands more, says Hamid Moqimi, the chairman of the Iranian Association of Cosmetics, Toiletries and Perfumery Importers.
“As of last year, the Iranian Association of Cosmetics, Toiletries and Perfumery Importers listed 250 companies, which had 20,000 people on their payrolls and indirectly supported 50,000 jobs. However, the Ministry of Industries, Mines and Trade threw them a curve on May 21, 2019, when it imposed an outright ban on imports of cosmetics and toiletries," he said.
Moqimi noted that these companies have laid off 8,000 skilled workers.
“This is while the domestic production sector can only meet 40% of the market demand for cosmetics and toiletries, and the remaining 60% are supplied through imports<” he said.
Before the imposition of the ban, all imports were carried out without the need for government extending subsidized foreign currency.
Imports were also subject to a 26-36% customs tariff, a considerable part of which were spent on the import of hearing aid.
“The government has denied itself this revenue, now that it has handed in the market over to smugglers,” he was quoted as saying by the news outlet of Iran Chamber of Commerce, Industries, Mines and Trade.
Given the advanced technology employed in production of cosmetics and toiletries, Moqimi said domestic production is facing serious challenges.
“However, over the past two years, importers were intent on continuing production by forming partnership with well-known international brands despite sanctions,” he said.
“I dare say the remaining 12,000 jobs in this sector will disappear down the road, if the government fails to fix current rules and regulation regarding commerce, as insurance companies are not financially capable of supporting the unemployed population.”
Moqimi also said trade bans over the past year, as acknowledged by officials, have done little to improve production.
According to the Headquarters to Combat Smuggling of Goods and Foreign Currency, the ban on imports have helped increase smuggling 3.5-fold.
“By unlocking legal cosmetics and toiletries imports, foreign currency that is now being absorbed by the contraband market would be directed toward legal imports and consequently job creation. In addition, public health will be safeguarded and we won’t be forced to incur the cost of treating diseases that are attributed to the consumption of smuggled, fake products,” he concluded.
