Iran Targets $10b in Annual Trade With EEU Within 2 Years

The Islamic Republic of Iran Customs Administration says Iran intends to increase annual trade with the Eurasian Economic Union to $10 billion within less than two years.
Mohammad Rezvanifar, head of the Islamic Republic of Iran Customs Administration, made the remarks in a recent meeting with Minister in charge of Customs Cooperation of the Eurasian Economic Commission Eldar Alisherov, IRNA reported.
According to the Iranian official, the administration of President Ebrahim Raisi is determined to develop strategic ties with the member states of the EEU.
The total volume of trade exchanges between Iran and the member states of the EEU stood at $3.3 billion in 2022, he said, adding that the Islamic Republic exported $1.5 billion of goods and imported $1.7 billion of goods in return that year.
The transit exchanges between Iran and the EEU member states were reported 1.8 million tons in the same year, including one million tons from Iran and 700k tons from the EEU member countries, he added.

Free Trade

Iran and the Eurasian bloc signed a memorandum on free trade on Jan. 19, 2022, in a ceremony held in Tehran at the International Exhibition Center.
The document was signed by the head of Iran's Trade Promotion Organization, Alireza Peymanpak, and EEU Trade Commissioner Andrey Slepnev, IRNA reported.
“The agreement will come into force after its formal approval by the governments of member states by mid-1402 [fiscal 2023-24],” he added.
According to the TPO chief, a list of traded goods was discussed in the final talks, based on which 90% of the traded commodities have been put on the “green” list while 10% were designated as “prohibited”.
The “green” list refers to goods traded by the two sides at zero customs tariffs.
He noted that the signed documents will be approved by EEU states by next month.
Slepnev said he expects the free trade agreement between Iran and the economic union to be signed soon.
"We held very important negotiations to settle a number of important issues. We are confident that the agreement will be signed in the near future," he told Sputnik.
The Russian official indicated that EEU and Iran are seeking to scrap most tariffs and launch joint projects in such spheres as transport, industry, food production and finance, pointing out that this will potentially create jobs in both Iran and EEU, and advance technological innovation.
In the same context, the Iranian Foreign Ministry confirmed that Slepnev met with Iran’s Deputy Foreign Minister for Economic Diplomacy Mehdi Safari. It cited Slepnev as saying that the trade pact would hopefully be finalized during his trip to Iran.
According to the Foreign Ministry, Safari described the potential free trade zone involving Iran, Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan as "a turning point in the expansion of ties" and proposed creating rail, road and maritime transport corridors between the six countries to streamline trade in industrial and agricultural goods.

Almost All Issues Cleared

EEU and Iran have agreed upon virtually all issues in their negotiations on a free trade area, and only a few issues related to the agricultural sector have to be cleared, the Eurasian Economic Commission's trade unit said following EEC Trade Minister Andrei Slepnev's visit to Tehran, Interfax reported.
"The main purpose of the visit was to consider key aspects of negotiations on concluding a free trade agreement between the Eurasian Economic Union and Iran at the level of delegation heads. The parties reviewed modalities of the understandings needed for finalizing the negotiations and signing an agreement. All issues have been agreed upon, except for mutual access to the market of certain categories of agrarian produce, on which they agreed to continue discussions," it said.
"The prospect of developing long-term and mutually beneficial cooperation in the transport, industry, agriculture, food security and other fields is impressive. A future agreement will help put a solid contractual foundation under these plans," the statement quoted Slepnyov as saying.

Preferential Trade Since 2018

Iran and EEU signed a three-year provisional agreement in Astana, Kazakhstan, on May 17, 2018, for the bloc to welcome Iran into EEU. 
The arrangement, which has lowered or abolished customs duties, is the first step toward implementing free trade between Iran and the five members of the union. 
Noting that the two sides currently exchange goods based on a preferential trade agreement, Spokesman of the Ministry of Industries, Mining and Trade Omid Qalibaf has said EEU has granted tariff concessions to 500 types of Iranian commodities while Iran reciprocated with 400 types.
Asked about the impact of Iran’s import bans on EEU trade deal, he said the ban will not be applied to imports from the Eurasian bloc.
“The prohibition on the import of certain types of goods like historical relics, pork, etc. continue to be enforced but restrictions on imports implemented to maintain foreign exchange reserves will not be applied,” he was quoted as saying by IRIB News.
There is a long list of products in Iran whose imports have been banned for many years. 
According to the deputy head of Iran’s Headquarters to Combat Smuggling of Goods and Foreign Exchange, Mostafa Pour-Kazem Shayesteh, the import of more than 2,000 types of goods is prohibited.
The Iranian government aims to economize on its foreign currency reserves by applying import restrictions.
Iran and EEU have finalized negotiations on free trade of more than 7,500 types of commodities, the head of Iranian delegation negotiating with the Eurasian bloc said earlier.
“Over the past two years, we have held around 30 rounds of negotiations with representatives of the Eurasian side — some face to face and others online. In the end, we agreed on a 150-page deal, which is the most comprehensive trade agreement [Iran has had],” Mirhadi Seyyedi was also quoted as saying by Tasnim News Agency.
According to the official, Iran’s trade with EEU is mostly focused on agricultural products.
“Our imports mostly constitute cereals and oilseeds. In return, Iran exports apple, vegetable, and greenhouse crops at zero tariffs,” he said.
“EEU has agreed to include about 95% of its traded goods in the agreement. That is almost all types of goods exchanged between the two sides, except for those we are reluctant to import for some reasons such as agricultural machinery or dairy products.”
Seyyedi noted that since the signing of the preferential trade deal in 2018, bilateral trade has doubled between Iran and EEU from about $2.5 billion to $5 billion a year.
“Never before have we had an agreement as inclusive as this [the prospective free trade deal with EEU]. Clearly, when the provisional agreement is upgraded to a free trade treaty, out foreign trade will get a considerable boost,” he said.