The National Coronavirus Headquarters has once again extended by one more week the shutdown of all non-essential businesses, i.e. Group II, III and IV of jobs in the high-risk red and orange zones for coronavirus transmission, the head of Tehran’s Chamber of Guilds said on Friday.
“Tehran’s Grand Bazaar will also remain closed for another week starting Saturday, May 1, to Friday, May 7, to contain the spread of Covid-19 infections,” Qasem Noudeh-Farahani was also quoted as saying by IRNA.
Notably, only businesses categorized as Group I, including bakeries, supermarkets, grocery stores, car shops, chain stores, health and treatment centers, pharmacies, factories, transportation companies, public parking garages, post offices, internet service providers, press, nursery homes and print shops are allowed to provide essential goods and services.
The extended closure comes as businesses are suffering massive financial losses.
“The coronavirus won’t be contained by the closure of guilds and small businesses. They need to operate to avert bankruptcy. During this difficult period, the closure of certain businesses while banks and tax offices remain open appears irrational,” Noudeh-Farahani said.
Over $12b in Losses
Businesses affiliated to Iran Chamber of Guilds have suffered as much as 3,000 trillion rials ($12 billion) in losses since the beginning of the coronavirus pandemic, Mohammad Baqer Mojtabaei, the secretary-general of the chamber, says.
“However, only 7% of them applied for the loans backed by the government under the Covid-19 relief assistance program for businesses in the first quarter of last fiscal year [March 20-June 20, 2020],” he was quoted as saying by ISNA.
Noting that the volume of loans was negligible, as it paid 120-160 million rials ($480-$640) for each worker with a maximum of three workers per enterprise. in relation to the losses suffered by guilds, Mojtabaei said, “The 12% lending rate was another reason behind the lukewarm reception toward the government’s relief loan program. Given that the benchmark interest rate in Iran is at 18%, business owners believe that the government’s 6% interest rate subsidy is not worth the difficult application process and length of time it would take to receive the credit.”
Iran Chamber of Guilds recently issued a statement expressing concerns regarding the economic implications of a new surge in Covid-19 cases, Mehr News Agency reported.
“Official figures suggest an increase in the number of new infections due to the decline in compliance with Covid-19 safety protocols during the Iranian New Year [March 21-April 2] holidays. More cities and counties are falling in the high-risk red zone for coronavirus transmission and widespread closures of businesses are likely to ensue,” the statement read.
“If more cities, including Tehran, Karaj and Isfahan, move into the red zone of the country’s color-coded coronavirus framework, more than one million businesses affiliated to ICG will shut down and three million people will become jobless.”
He made the statement before the provincial capitals were placed on red alert.
$388m in Loans
A total of 92,120 billion rials ($388 million) worth of loans have been paid to the applicants of government’s coronavirus relief package for businesses hurt by the outbreak of Covid-19, says Hossein Mahmoudi, an official with the Ministry of Cooperatives, Labor and Social Welfare.
“Registration for coronavirus loan started at Kara.mcls.gov.ir on May 9, 2020. Thus far, 513,545 applications involving 953,581 jobs have been submitted. The total value of loans requested stands at 176,770 billion rials [$745 million], of which 92,120 billion rials [$388 million] or 67% have been paid,” he was quoted as saying by IRNA.
Noting that the headquarters to combat the economic consequences of coronavirus had expected loan applications to be worth 200,000 billion rials ($843 million), the official said, “As per the government’s coronavirus relief package, businesses that have been hurt directly and closed down by Covid-19 will receive 160 million rials [$674] for each worker and those which were not shut down are eligible to receive 120 million rials [$505] for each of their workers. The lending rate of these loans is 12%.”
Based on recent figures collected by Iran Chamber of Guilds, an average of 82% of Iranian businesses and sales outlets abide by the regulations and protocols set by the National Coronavirus Headquarters, the head of the chamber said on Wednesday.
“In some provinces, the figure declines to between 50% and 60%. Owners of outlets not conforming to protocols preventing the spread of Covid-19 have been reprimanded and received warnings,” Mojtabaei was quoted as saying by IRIB News.
So far, the official added, more than 3,000 sales outlets have been shut down across the country for flouting the protocols and regulations set to curb the pandemic.
“Unfortunately, the pandemic has prolonged for more than a year and a half, longer than expected, and to top that the government has failed to support businesses as it should have during this period. These have made it especially hard for most businesses to observe new pandemic protocols since they have rents and other expenses to pay,” he said.
Mojtabaei noted that Iran Chamber of Guilds implores businesses and people to keep observing Covid-19 protocols until the fourth wave of the pandemic is over in the country.
The fourth wave of the disease emerged soon after the Iranian New Year holidays in early April, prompting the government to announce new lockdowns.
Over 2.3 million people have been infected with the new coronavirus in Iran so far.
