Iran traded 38.56 million tons of goods worth $24.19 billion (excluding crude oil exports) with its 15 neighboring countries during the first half of the current Iranian year (March 21-Sept. 22) to register an 8% decline in tonnage but a 7% rise in value of exchanges compared with the similar period of last year, according to the spokesperson of the Islamic Republic of Iran Customs Administration.
Iranian exports (excluding crude oil) stood at 29.28 million tons worth $12.33 billion, registering a 19% decline in weight but a 10% growth in value, Rouhollah Latifi was also quoted as saying by IRNA.
Iraq was the biggest export destination among the countries under review during the period, as it imported 9.86 million tons of Iranian goods worth $3.38 billion, registering a 12% fall in value.
All changes reported below are in value terms.
Following Iraq were the UAE with 5.72 million tons worth $3.11 billion (up 39%), Turkey with 4.1 million tons worth $2.62 billion (up 14%), Afghanistan with 1.58 million worth $792 million (down 21%), Pakistan with 1.31 tons worth $561 million (up 3%), Oman with 1.54 million tons worth $542 million (up 95%), Azerbaijan with 372,000 tons worth $363 million (up 72%), Russia with 622,000 tons worth $339 million (up 25%), Turkmenistan with 631,000 tons worth $206 million (up 42%), Armenia with 426,000 tons worth $177 million (up 14%), Kuwait with 2.35 million tons worth $82 million (up 26%), Kazakhstan with 273,000 tons worth $75 million (down 6%), Qatar with 464,000 tons worth $65 million (down 13%), Bahrain with 4,847 tons worth $3.9 million (up 21%) and Saudi Arabia with 476 tons worth $246,509 (up 532%).
Imports from these neighbors to Iran during the period stood at 9.32 million tons worth $11.87 billion, registering a 14% fall in tonnage but a 4.4% increase in value compared with the corresponding period of last year.
The UAE with more than $7.2 billion topped the list of exporters to Iran, registering a 1% decrease. It was followed by Turkey with $2.68 billion (up 10%), Russia with $876 million (up 37%), Pakistan with $494 million (up 350%), Oman with $365 million (up 35%), Iraq with $90 million (down 82%), Kazakhstan with $80 million (up 148%), Qatar with $21 million (up 248%), Azerbaijan with $19.4 million (down 15%), Turkmenistan with $15.3 million (down 29%), Afghanistan with $13.1 million (up 106%), Kuwait with $5.1 million (down 27%), Armenia with $5 million (down 65%) and Bahrain with $893,000 (down 30%).
Latifi noted that Iran’s trade balance with its neighbors stood at $457 million in H1.
Iran’s total foreign trade, excluding crude oil exports, stood at 68.1 million tons worth $50.28 billion during the first six months of the current year, registering a 13.2% rise in value compared with the corresponding period of last year, according to IRICA.
Exports (excluding crude oil) stood at 51.78 million tons worth 24.25 billion, registering a 12.5% fall in terms of weight, but a 13.32% rise in value. Imports hit 16.32 million tons worth $26.03 billion, registering a 14.72% fall in terms of weight, but a 13.15% rise in value.
Decline in Trade in Real Terms: TCCIM
Despite IRICA’s reports saying Iran’s trade has been on the rise, which draws on nominal values, a recent report released by Economic Studies Department of Tehran Chamber of Commerce, Industries, Mines and Agriculture shows how trade has been declining in real terms.
According to this report, from the fiscal 2011-12 to 2021-22, the general trend of real exports and imports of goods and services from/to Iran has registered a downward with the latter registering a more pronounced decline.
The goods and services exports in the fiscal 2011-12 stood at 2,530,000 billion rials at constant prices of the fiscal 2016-17. The figure dropped to 2,220,000 billion rials in the fiscal 2021-22.
The average real annual growth of exports during the period stands at -29.1%.
Meanwhile, the import of goods and services in the fiscal 2011-12 at constant prices of fiscal 2016-17 was about 5,100,000 billion rials (almost twice the volume of exports in that year). It reached 1,280,000 rials (58% of exports) by the end of the period under review.
The average real annual growth of the imports was at -12.9%.
Intensification of sanctions, restrictions on access to foreign exchange resources and export earnings, and imposition of bans and restrictions on the import of certain groups of goods by the Iranian government played a significant role in shaping the country’s commercial landscape during the period.
During half of the decade from the fiscal 2012-13 to 2021-22, the annual growth of goods and services exports was positive and during the other half, it was negative. The annual growth of imports was negative in six years, while it was positive in four years.
From the fiscal 2014-15 to 2016-17, the annual growth of exports was positive and reached 27.4% in the fiscal 2016-17.
With the restrictions on the export of some of Iran's goods, as well as limitations on financial exchanges, the rate of export growth took on a downtrend as of the fiscal 2017-18 and it became negative from the fiscal 2018-19 to the fiscal 2020-21.
The average annual growth of exports was -11% during the three-year period.
During the same period, the average annual growth of imports was -30%.
In the fiscal 2021-22, the export’s average annual growth became positive after three consecutive years of negative trend and reached 5.2%. The growth of oil exports and non-oil exports were both effective here.
The average annual growth of imports was positive and stood at 24%, which is the highest figure from the fiscal 2011-12 to the fiscal 2021-22.
From the fiscal 2012-13 to 2021-22, the contribution of exports of goods and services to Iran’s economic growth was positive during half of the years under review and negative during the other half.
The contribution of imports to growth was positive for six years and negative for four years.
From the fiscal 2018-19 to the fiscal 2020-21, the goods and services exports’ contribution was negative due to the intensification of sanctions and the decrease in oil exports. This is while the role of imports was positive due to the restrictions on some imported goods and decline in imports.
The average annual contribution rate of goods and services exports was negative and stood at 1.3%, while it was positive for imports and hit 12.9% during the fiscal 2011-12 to the fiscal 2021-22.
In the fiscal 2021-22, the increase in goods and services exports led to growth in the contribution of exports to economic growth and stood at 0.75% in the 4.7% economic growth.
The growth in imports also had a negative contribution to economic growth and stood at 1.71%.
In general, the net export of goods and services had a negative impact of 0.96 percentage points in the economic growth of fiscal 2021-22.
The TCCIM report cited a recent joint studies by the World Trade Organization and the World Bank regarding the role of trade in developing economies and said the total share of developing countries in world exports increased from 16% in 1990 to 39% in 2021 which, along with the growth of exports and the increase in their share in the total global trade, led to the improvement of the welfare and economic growth of these economies.
Export of goods from developing economies increased from $3.38 trillion in 2005 with a 2.8-fold increase to $9.6 trillion in 2021, and the export of services of these economies increased from $563 billion in 2005 with a similar growth rate to $1.6 trillion in 2021.
According to Iran’s foreign trade statistics, in Iran's economy, the export of goods and services has not played a positive role in generating economic growth, rather in some periods, it has had a negative contribution to growth.
