Tehran is scheduled to host Eurasia Expo 2021, for the first time, from May 18 to 21, according the head of Trade Promotion Organization of Iran.
"Hosting this international exhibition will be a great opportunity to facilitate free trade negotiations [between Iran and Eurasian states]," Hamid Zadboum was also quoted as saying by IRNA.
The event has been scheduled at Tehran’s International Exhibition Center, but could be postponed due to the coronavirus pandemic.
The Eurasian Economic Union is a bloc of Russia, Kazakhstan, Armenia, Kyrgyzstan and Belarus.
All commodity groups from EEU countries and Iran will be displayed in this exhibition.
According to the TPO official, as the Eurasian bloc’s trade turnover with other countries is at $850 billion per year, boosting commercial ties with these countries can help boost economic relations.
Free Trade Talks
Negotiations on free trade with zero tariffs have been continuing between Iran and EEU.
“If this goal is achieved, we would have entered an unrivaled market because EEU only has preferential agreements with Vietnam, Singapore and Serbia,” Mirhadi Seyyedi, advisor for international affairs and trade agreements of Trade Promotion Organization, said recently.
“Such an achievement will bring positive results in our regional economic interaction,” he added.
The official stressed, “Enhancing trade with EEU will facilitate our [overall] trade and financial interactions.”
Iran and the Eurasian Economic Union signed a three-year provisional agreement in Astana, Kazakhstan, on May 17, 2018, for the bloc to welcome Iran into EEU. The arrangement, which lowers or abolishes customs duties, is the first step toward implementing free trade between Iran and five members of the union.
The average tariff set by EEU on Iranian goods as part of a preferential trade agreement stands at 3.1%, while the figure is 12.9% for EEU goods exported to Iran.
Iran and EEU have listed 862 types of commodities in their three-year provisional trade agreement. As per the deal, Iran will enjoy easier export terms and lower customs duties on 502 items and the same goes for 360 items from EEU member states.
EEU removed tariffs on the import of 11 Iranian agricultural and food products in April and conveyed the decision to the Trade Promotion Organization of Iran in an official letter.
“These goods that can, from now on, be exported at zero tariff include potato, onion, garlic, cabbage, carrot, chili, wheat, grains, rice and ready-to-eat meals for kids. The measure taken by EEU in these difficult times when the country is battling the Covid-19 crisis, in addition to economic sanctions, can help boost our production and exports,” Reza Nourani, the head of Iran’s National Association for Agricultural Products, was quoted as saying by Fars News Agency.
The Eurasian Economic Union was created in response to the economic and political influence of the European Union and other western countries. Key objectives of EEU include increasing cooperation and economic competitiveness for member states and promoting stable development to raise their standards of living.
The Treaty of Eurasian Economic Union was signed on 29 May 2014 by the leaders of Belarus, Kazakhstan and Russia, and came into force on 1 January 2015.
$1.9b Worth of Trade in 11 Months
Iran and EEU member states traded a total of $1.9 billion worth of commodities, excluding crude oil, during the first 11 months of last Iranian year (March 20, 2020-Feb. 18) to register a 9.4% decline compared with the similar period of the preceding year, data released by Tehran Chamber of Commerce, Industries, Mines and Agriculture show.
The figure accounts for close to 3% of Iran’s total foreign trade over the period, Mehr News Agency reported.
Iran’s exports to EEU members hit 2.4 million tons of non-oil products worth $933 million, registering a 17% and 4% year-on-year decrease in volume and value respectively.
Exports of EEU members to Iran stood at 2.9 million tons worth $1 billion, showing a 1% increase in weight and 14% decline in value YOY.
Iran’s trade deficit with EEU member countries stood at $84 million over the 11-month period under review.
The bloc has an integrated single market of 180 million people. It encourages the free movement of goods and services, encouraging common policies in the fields of transport, industry, agriculture, energy, foreign trade, investment, customs, technical regulation, competition and antitrust regulation. Provisions for a single currency and greater integration are envisioned for the future.
The union operates through supranational and intergovernmental institutions. The Supreme Eurasian Economic Council is the supreme body of the union, consisting of the heads of member states. The second level of intergovernmental institutions is represented by the Eurasian Intergovernmental Council (consisting of the heads of member states). The day-to-day work of EEU is handled by the Eurasian Economic Commission, the executive body of the union. There is also a judicial body – the Court of EEU.
Russia is Iran’s biggest trade partner in EEU.
Iran exported $800 million worth of commodities to Russia in 2020 to register a 105% increase compared with 2019.
The volume of exports, according to Iran’s Ambassador to Russia Kazem Jalali, is a record high in the history of the two neighbors’ bilateral trade.
“The increase in exports came despite the outbreak of Covid-19 last year as well as the intensification of the unilaterally imposed US sanctions on Iran’s economy,” Jalali was quoted as saying by IRNA.
Among the reasons for the rise in exports over the period, the envoy said, is the preferential trade agreement between Iran and the Eurasian Economic Union, which came into effect in October 2019.
