Economy, Domestic Economy

Exporters Wait for Gov’t Action

Exporters Wait for Gov’t Action  Exporters Wait for Gov’t Action

Since President Hassan Rouhani took office last year, his government has tried to attach great importance to export as an engine of growth and development. In its plan of action to exit recession, the government has included proposals aimed at increasing support for the country’s businessmen, especially the non-oil exporters, as an effective way to pull the economy out of recession and also to introduce Iranian brands at the global markets. Now, with the National Export Day near, Iranian exporters are waiting to find out what will be outlined on October 21 as the government’s strategy to help exports grow and stimulate economic growth also.

This year, Rouhani will open his first National Export Day as President. He has, on several occasions, vowed to provide support for the country’s exporters, and with last November’s interim nuclear deal with the major world powers having paved the way for showcasing Iranian-made products on the global markets, many expect a good year ahead for the non-oil exporters as the government also plans to reduce its dependence on oil revenues.

However, with the November 24 deadline for reaching a comprehensive nuclear agreement fast approaching, some difficulties may still remain in case the two sides fail to seal an accord by that date: financial restrictions would remain in place, thus, making it difficult for conducting almost any type of transactions with traders in other countries.

In September, it was announced that the High Council of Exports is going to focus on easing the entire process of exportation in the near future.

“Increasing non-oil exports has always been regarded as a primary objective for the government and the Rouhani administration is also determined to promote it as the highest economic priority,” first vice-president Es’haq Jahangiri said in a meeting attended by members of the parliament’s export committee and chambers of commerce as well as private sector industrialists.

Non-oil exports can play a major role at a time when the country is grappling with recession. Most economists believe that non-oil exports can reinvigorate the economy and help pull it out of recession.

“Peaceful international relations is a major requirement for bolstering exports and the government has taken effective steps in this respect through reaching mutual agreements with other countries,” Jahangiri said in September, calling on all Iranian exporters to draw for themselves a broader view of the regional markets and promised, on behalf of the administration, to make every effort in order to remove the existing obstacles and facilitate the process by taking new measures, including allocation of a special credit line for countries of destination.

Non-oil exports in 2013 surpassed $40 billion, and the number should exceed $50 billion by the end of the current Iranian year (ending March 21, 2015)”, Asadollah Asgaroladi, chairman of the export committee of Iran’s Chamber of Commerce said last month.

Asgaroladi also called on the government to devise an effective policy to ease restrictions facing non-oil exports through improving foreign relations, which could eventually help remove the US-led sanctions and facilitate financial transactions with other countries. Tariff reviews and facilitation of visa issuance for exporters were also among other required improvements to trade regulations, according to Asgaroladi.

 What Exporters Want

In the meantime, non-oil exporters have been raising their concerns on the strictness of the existing foreign trade regulations, and have put forward proposals for increasing trade exchanges with foreign countries. They want the government to consider certain initiatives such as granting low-interest loans to exporters, including a comprehensive export package in the 6th Five-Year Economic Development Plan (2016-2021), facilitating Iranian exporters’ presence in international exhibitions, establishing export-friendly funds and financial institutions, providing a new framework for the timely refunding of VAT on export goods, revising the current trade regulations -- in particular for the technical and engineering services -- and removing anti-export bias, rendering legal and administrative support to exporters and increasing export incentives.

Exporters, and producers of non-oil goods in particular, also want the foreign ministry to help with the search and identification of potential new markets for Iran’s exports.  

Yet, as one prerequisite for increasing exports is to apply quality assurance to the entire manufacturing sector, the government is required to make sure, through introducing incentives and new standards, that factory products meet specified quality controls, and therefore are capable of competing on the international level.