TPO to hold 1st meeting of Iran-neighbors joint economic committees

May 19, 2019 - 19:52

TEHRAN- Iran’s Trade Promotion Organization (TPO) will hold the first meeting of the chairmen of the country’s joint economic committees with its neighboring countries on Monday, Mohammadreza Modoudi, the acting head of TPO, announced.

The official, who is in charge of implementing resistance economy outlines in the export sector, said this meeting will be held at the place of TPO in line with the main plan of this organization which is promoting the country’s export status, TPO website reported.

Modoudi also mentioned increasing the volume and diversity of the products to be exported to the neighboring countries, strengthening specialized export unions, development of large export companies, and establishment of international consortiums as the main responsibilities that the Ministry of Industry, Mining and Trade has specified for TPO.

In a press conference in late January, the official had said that Iran will not solely rely on Iran-Europe trade mechanism, known as special purpose vehicle (SPV), for developing foreign trade and it will rather use its own capacities and capabilities in doing so.

He said despite the U.S. efforts for isolating Iran, the country has a good economic relationship with its neighbors and Iran’s foreign trade is flourishing strongly.

Mentioning the great potential of Iran’s neighboring markets, the TPO acting head said, “Iran’s neighbors have a $1 trillion import capacity annually, and considering the U.S. sanctions we should focus more on our neighboring markets.”

Surrounded by fifteen neighboring countries through land and sea, Iran enjoys a very strategic geopolitical and economic position in the Middle East and considering the U.S. recent actions for increasing pressure on the country’s oil industry, many economy experts and scholars believe that Iran should retaliate by focusing more on improving domestic production and increasing non-oil trade especially with its neighboring countries.

As mentioned before, Iran shares border with fifteen countries, namely the United Arab Emirates, Iraq, Turkey, Afghanistan, Pakistan, Russia, Oman, Azerbaijan, Turkmenistan, Kuwait, Qatar, Kazakhstan, Armenia, Bahrain, and Saudi Arabia.

Based on the latest data published by TPO, the value of trade with the neighboring countries stood at over $36.5 billion in the past Iranian calendar year (March 2018-March 2019), that is about 41 percent of the country’s total non-oil trade in the mentioned time span.

The country, however, doesn’t have equal trade with all the mentioned nations and Iraq, Afghanistan, Pakistan, Oman, Azerbaijan, Kuwait and Turkmenistan account for most of Iran’s trade with its neighbors.

As Iran’s top trade partner in the region, Iraq is one of the most important nations that the Islamic Republic is closely interacting with on many levels and considering the two country’s great potentials for mutual trade, both sides are eager for increasing their trade turnover to a level much higher than its current amount.

The Arab neighbor supplies most of it electricity and gas needs from Iran and imports a wide range of non-oil commodities from Iran including foodstuff, home appliances, agricultural products, air conditioners and spare car parts.

Iran and Iraq’s current trade turnover stands at $12 billion which is the highest among all the neighboring countries. Earlier in March, Iranian President Hassan Rouhani announced in an Iran-Iraq business forum in Baghdad that the two countries plan to boost this number to $20 billion in the near future.

Iran’s non-oil trade data for last year indicates that exports to Iraq accounted for more than 37 percent of Iran’s total exports to the neighboring countries and the number increased by over 36 percent compared to the preceding year. In terms of imports, however, Iraq stands at the seventh place among exporters to Iran in the region which consequently pushes the trade balance between the two countries significantly positive toward Iran.