Insider news & Analysis in Iran

by Jazeh Miller

An excess of $50 billion in goods are imported to Iran each year, along with another $17-25 billion worth of smuggled contraband, according to Iranian regime’s official figures. These figures were released by Iran Customs Administration, and they show that in the first six months of the year, Iran imports have increased 15 percent to $23.5 billion, while non-oil exports have dropped three percent during this period.

It has been reported by state newspapers that Iran’s total foreign trade has increased six percent to $44.1 billion, while a trade deficit of $3 billion is being experienced.

In an undeveloped economy like Iran’s, import is regarded as a negative economic factor. Still, this doesn’t mean that there should be no imports — countries need to import goods and services that can’t be provided at home, and those imports are proper and necessary. However, when the goods that are imported could easily be produced domestically, those imports are destructive.

Every one billion dollars worth of imports destroys close to one hundred thousand jobs. As an example, if Iran needs 100 million adhesive bandages a year, perhaps only 15 percent are domestically produced. The remainder are imported, as Iran’s adhesive bandage producing factories are working at only 15 to 20 percent of their capacity, despite the fact that domestic production of the bandages is possible.

Iranian regime MP Seyed-Mohammad-Javad Abtahi says, “Deputy Industry Minister has said that 5,200 small and medium industrial units have been closed last year. This is while such items like whips, pumice stones, dogfish, cobblestones, honky horns, zippers, suspenders, mouse traps, hoses, shovels, pickaxes, and almost every kind of water mineral are being imported into the country,”

Upon examination, many of the imported goods can be produced domestically. In fact, although Iran has the highest quality mineral water in the world, mineral water is being imported. Fake saffron is imported and sold in Iran’s markets as genuine, while Iran is known as the “Land of Saffron”.

While the Iranian regime publicizes the domestic car industry, luxury cars are being imported, and the number of imported cars is 20 times bigger than the exported ones.

These imports have driven Iran’s small and medium sized industries into closure and bankruptcy, which is followed by a widespread unemployment. More than 60 percent of the country’s small industries have been closed.This is a disaster that has caused the unemployment of millions of Iranians, the real tragedy caused by excessive imports.

Despite Iran’s long history of fish farming, this industry is currently in facing reversal. October 11th, state-run Javan newspaper reported, “With a 200 percent return, the 400-million fish-spawn import has been monopolized by a group of five.”
Fish farmers criticize Iran Fisheries Organization’s monopolistic policies, saying, “60 percent of the country’s fish farms are about to go belly up. That’s because the fish spawns imported last year by a group of five were carrying pathogens that have infected most fish farms.”

In addition to legal imports, nearly half of the country’s imports are contraband. This has had such a negative impact on Iran’s industry that even many of the country’s old, resourceful companies have shut down.

It’s alleged that the importers are linked to the regime, specifically the Revolutionary Guards, who have private waterfronts and airports.

State-run ISNA news agency points to smuggling of clothing, in their article on October 8, 2017. It writes, “while the UNIDO has announced that the value of Iran’s annual clothing import is one billion dollars, Iran Customs Administration has declared that it is $61 million, namely a $940 million difference.” It was later announced that the worth of smuggled clothing was $2.5 billion.

However, the regime’s Industry and Mining Minister, Mohammad Shariatmadari, a few weeks after taking office, said that he doubted the figure, saying that the figure is even larger. “We simply put the market at foreign producers’ disposal”, he said. “We’ve had $12 billion of imported clothing while their customs duties have not been paid, meaning that they’ve been smuggled into the country.”

 

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