Iran Preferential Trade Deal Expansion Priority for Turkey

Iran Preferential Trade Deal Expansion Priority for Turkey
Iran Preferential Trade Deal Expansion Priority for Turkey

Finalizing ongoing negotiations with Iran for the expansion of a preferential trade agreement with Turkey is a priority, the country’s Energy and Natural Resources Minister Fatih Donmez said on Wednesday.
The trade deal came into effect on Jan. 1, 2015, and negotiations have been ongoing to expand the pact by increasing the number of traded products between Turkey and Iran, Donmez told the virtual 28th Turkey-Iran Economic Commission, Daily Sabah reported.
Customs cooperation was another topic up for discussion at the meeting. Within this scope, both sides agreed to an electronic data interchange protocol, to carry out a simplified customs frontier project and the mutual recognition of an Authorized Economic Operator project.
Donmez stressed that these projects will have a positive impact on foreign trade by enabling easier and faster trade while eliminating bureaucratic procedures based on mutual trust.
Both sides agreed that technical teams would meet in the near future to put the plans into action.
“The two sides also agreed on increasing fairs and trade delegations between Turkey and Iran to show our [Turkey’s] concrete support and the great importance attached to cooperation between private sector representatives,” he said.
The Turkish minister noted that support for the activities of Turkey-Iran Business Council and other private sector establishments, notably small- and medium-sized enterprises, would also continue, particularly after the pandemic.
Consequently, both sides agreed to commit to talks on developing an “action plan” between the Small and Medium Enterprises Development Organization of Turkey and its Iranian equivalent, Iran Small Industries and Industrial Parks Organization.
Donmez concluded that the commission also addressed other areas of cooperation, including health, energy, transportation, education, environment, agriculture and forestry.



Fiscal 2020-21 Trade Down 31% to $6.8b

Iran and Turkey traded a total of 11.17 million tons of commodities worth $6.85 billion in the last Iranian year (March 2020-21), registering a 51.52% and 31.82% decline in weight and value respectively compared with the year before, according to the spokesperson of the Islamic Republic of Iran Customs Administration.
“Iran exported 6.36 million tons of goods worth $2.51 billion to the neighboring country over the period under review, indicating a 63% and 50% decline in volume and value YOY,” Rouhollah Latifi was quoted as saying by IRNA.
The main exported products were natural gas, nuts, dairy, milk powder, fruit and vegetable, vinegar, tobacco, salt, minerals, herbal extraction, polymers, construction materials, doors and windows, apparel, bags and footwear, carpet and fabric, tiles and ceramics, stone, toiletries, dishes, pipes, home appliances, agricultural and industrial machinery and electronic devices, as well as steel sheets and ingots.
Latifi added that Iran imported 4.81 million tons of products worth $4.34 billion from Turkey during the same period, registering a 15.5 and 13.5% decline in weight and value respectively YOY. 
The imports included pulses, barley, banana, rice, seeds, edible oils, cocoa, fruit essence, industrial oils, raw materials and machinery, paraffin, industrial acids and oxides, pharmaceuticals, vaccines and medical and dentistry equipment, fertilizer, fabric, auto spare parts, printing ink, paper and cardboard, paint, minerals, wood sheets, galvanized sheets, bolts and nuts, agricultural equipment, elevators, cranes and packaging equipment.
According to the official, each ton of exports to Turkey during the period was valued at $394.9 on average up 36.22% from $289.9 in the year before, as each ton of import was valued at an average of $901.8, up 2.31% from the $881.4 of the year before.



Social Security Agreement 

A business representative from Tehran Province said the Turkey-Iran Social Security Agreement signed on March 24 would contribute to strengthening commercial and economic relations between the two countries. 
Fatih Cayabatmaz from the Independent Industrialists and Businessmen Association told Anadolu Agency that the agreement offers important opportunities for the business world.
"The implementation of the Turkey-Iran Social Security Agreement will increase Iranian businessmen's interest in Turkey.
Noting that Iranians topped the list of foreigners establishing a company in Turkey, Cayabatmaz said, "In February, Iranians ranked first on the list with 75 companies.” 
The Turkish official noted that with the new agreement, Iranian businessmen who have founded a company in Turkey need to submit documents indicating that they paid insurance in their home country for their Iranian staff, so that they don’t need to pay insurance in Turkey.
"The time spent by Iranian workers working in Turkey will be valid in Iran. This will reduce costs and increase the possibility of Iranian business investment in Turkey. The same applies for Turkish businessmen operating in Iran and their personnel," he said.
He noted that health insurance for an employer would be valid in the other country, allowing workers to access health services free of charge.
A previous Social Security Agreement between Turkey and Iran, signed on April 16, 2016, was approved by the Turkish Parliament on March 24.
With the addition of Iran, the number of countries with effective social security agreements with Turkey has risen to 34.

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