Economy, Domestic Economy

Iran Biggest Mideast Producer, Consumer of Footwear

Domestic Economy Desk
Iran Biggest Mideast Producer, Consumer of FootwearIran Biggest Mideast Producer, Consumer of Footwear

Iran is the biggest producer and consumer of footwear in the Middle East, the head of the Association of Managers and Experts of Iranian Shoe Industry (known as ASSOMES) announced.

"An estimated 185 to 210 million pairs of footwear were produced in the country last year (March 2016-17)," Ali Lashgari, secretary-general of the association and a member of Iran Chamber of Commerce, Industries, Mines and Agriculture, also told Financial Tribune.

"Latest statistics show Iran exported $32 million worth of footwear during the five months to Aug. 22, up 1.4% compared to last year's corresponding period," Lashgari said, adding that the Ministry of Industries, Mining and Trade has projected the country's footwear exports to reach $125 million by the Iranian yearend (March 20, 2018).

Last year's footwear exports stood at 18,700 tons worth $99.91 million. A closer look at exports shows a slight downward trend since the fiscal 2012-13.

Iran's main customers are Iraq, Afghanistan and Azerbaijan. China and Turkey are the main exporters of shoes to Iran.

The country's average export price for each pair of shoes stood at $2.23 in 2015 and $5.6 for leather shoes.

Global statistics suggest 39% of value terms of the world's footwear exports in 2015 belonged to leather shoes, with Iran having an 8.5% share. In terms of number, Iran had a 4% share in the global leather shoe share of 15%.

On the import front, the Middle Eastern country imported $213.97 million worth of footwear in 2016, registering a decline of 44.72% over 2015. Since 2012, Iran's footwear imports have had an irregular course. However, it seems they have been on a downhill since 2014, data from show.

About 95% of active businesses in Iran's shoe industry fall under the category of small and micro businesses.

By definition, enterprises run by 50 workers or less are considered small-sized, according to Iran’s Small Industries and Industrial Parks Organization.

A glance at the general status of footwear enterprises in terms of size reveals that 58% of all units in this industry have fewer than 10 employees.

"These units are operating with less than 50% of their production capacities on average," Lashgari said.

The ASSOMES chief noted that these units are not doing well because of several reasons, including the higher costs of raw materials in Iran compared to same overseas, prohibitive rents, high transportation and production costs, as well as high wages.

According to ASSOMES, a total of 500,000 people, directly and indirectly, are estimated to be working in the production and distribution of natural and synthetic leather, bags, footwear and related industries.

The Fourth International Bag, Shoe, Leather and Related Industries Exhibition will be held from October 25 to 28 at Tehran's International Permanent Fairground.



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