Iran’s exports to African countries reached $1.19 billion in the last fiscal year (March 2021-22), registering a 107% rise compared with the previous year and boosting the volume of exports to a record high, according to director general of Arab and African ountries Department of the Trade Promotion Organization of Iran.
“Our top 10 export destinations were Ghana with $353 million, South Africa with $254 million, Nigeria with $125 million, Mozambique with $98 million, Kenya with $77 million, Sudan with $73 million, Algeria with $67 million, Tanzania with $55 million, Somalia with $29 million and Ethiopia with $11 million,” Farzad Piltan was also quoted as saying by IRNA.
The official noted that Iran’s main exported products to Africa during the period were iron and steel ingots, urea, liquid butane and propane, floorings, iron and steel profiles and construction materials.
“Exports to South Africa saw the highest increase of 570%. Last year, close to 553,000 tons of goods were sold to that country worth around $254 million. This is while in the previous year, only 27,000 tons of goods worth $38 million were exported to the African state. Our main exported products were urea [$280 million], hot rolled steel bars [$11 million], liquefied butane [$8 million], liquefied propane [$5.4 million], sulfur [$4.6 million], floorings [$2.8 million] and steel [$1.6 million],” he said.
“A total of $60 million worth of goods were imported from African states during the same period, registering a 37% decline compared with the previous year.”
The main exporters to Iran were Tanzania, Ghana, Ethiopia, South Africa and Kenya.
The official pointed out that exports from South Africa declined by 25% during the period to stand at nearly $6 million.
“In recent years, Iran’s exports to Africa increased after Iranian producers and exporters boosted their market research and marketing to secure footholds in new markets. They have also adapted themselves and found new ways for conducting trade under the economic sanctions,” he said.
“Iran has taken measures to increase the number of commercial delegations it sends to and receives from African states, organize exhibitions and joint economic commissions, and hold talks with private and public sectors of Africa.”
Following the rise in development projects conducted in some African counties, Piltan said demand for certain commodities is on the rise in these states, providing ample opportunity for Iran to further increase exports.
“We have many plans which will all be implemented in the next five months. We are establishing an African Affairs General Bureau in the Trade Promotion Organization, which will focus on managing and expanding commercial ties with African states. Moreover, two Iranian trade centers are being launched in Uganda and Tanzania and a ‘Technology House’ in Kenya. We have scheduled joint economic commissions with officials and businesspeople from Nigeria, Ghana, Mali and Niger. We will also be hosting the ministers of industries and transportation of Congo and Algeria,” he concluded.
Decline in Fiscal 2020-21 Trade
According to Trade Promotion Organization of Iran's Arab and African Countries Department, Iran exported $580 million worth of goods to Africa in the fiscal 2020-21.
Steel and iron semi-finished products and ingots, urea, rebar, cement, raisins, canned food, sweets, chocolate, biscuits, pistachios and floor coverings were the main goods exported to Africa.
Iran’s fiscal 2020-21 imports from Africa stood at $96 million. The imported goods mainly included feed corn, manganese ore and concentrate, tobacco, tea, tuna, mining machinery and equipment, essence and herbs, zinc ore and fruit seeds.
Iran’s exports to African countries registered an 8% and 14% decline in tonnage and value respectively compared with the previous fiscal year, according to the Islamic Republic of Iran Customs Administration.
Intensification and expansion of US sanctions, the coronavirus pandemic and partial closure of global events and trade relations were the main reasons behind the decline in Iran-Africa trade in the fiscal 2020-21, ILNA reported.
Problems from both sides are said to blame for the low presence of Iranian products in African markets.
"From the Iranian side, lack of close communication and knowledge of African markets by the private sector, absence of planning and high marketing costs, lack of direct presence in African markets, shortage of infrastructure such as banking relations, transportation, etc. are among the most important problems and obstacles," Piltan said.
In addition, economic and political instability, lack of proper administrative and security arrangements for long-term economic and trade activities, inadequate financial capacity of the private sector and African governments are among the problems and obstacles from the African side.
The Trade Promotion Organization of Iran has said that it plans to introduce Iran’s export capabilities to African traders by using the capacities of the United Nations Economic Commission for Africa as well as the Iranian embassies in African countries and other relevant institutions, while creating coordination at the domestic level and pursuing the establishment of trade infrastructure with the Africa, such as transportation lines and the establishment of banking relations.
TPO also plans to allocate €200 million to promote exports to African countries.
The fund will be part of a $2 billion support package approved by the National Development Fund of Iran (the country's sovereign wealth fund) to promote Iranian exports.
The package is aimed at removing hurdles to expand foreign trade with African nations.
According to Hamid Zadboum, former TPO head, the NDFI support would be given to exporters via designated banks over two years.
Money has been deposited with four banks, namely the Export Development Bank of Iran, Cooperative Development Bank, Bank Keshavarzi (special agro lender) and the Venezuela Bi-National Bank.
