Iran-Eurasian Economic Union FTA inches closer to final approval

Since the ratification of Iran’s accession to a free trade zone with the Eurasian Economic Union in May 2017, the Iranian government prepared a bill to be debated by parliament about the zone’s creation. Now, the bill is moving closer to be finally ratified by the end of the current Persian year (21 March).

4 March 2019
ID : 11863
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A government bill to allow the creation a free trade zone between Iran and the Eurasian Economic Union has been cleared at a parliamentary commission driving it a step closer to a final approval by lawmakers.

“The bill on preliminary agreement on the creation of a free trade zone between Iran and the Eurasian Economic Union was studied at the commission in the presence of Energy Minister [Reza Ardakanian] and later approved by the parliament’s National Security and Foreign Policy Commission,” said Ali Najafi Khoshrudi, a spokesman for the commission on Sunday.

Earlier, President of Iran-Russia Joint Chamber of Commerce Tizhush Taban told Iran Chamber Newsroom that should the bill be passed into a law “by the end of March 2019, it’ll benefit Iran especially after the renewal of US sanctions.”

Last May the Eurasian Economic Union (EAEU), comprised of Russia, Belarus, Kazakhstan, Kyrgyzstan and Armenia agreed to create a free trade zone with Iran. Later in November, Russian President Vladimir Putin ratified the decision.

The decision allows Iran entrance into the free trade zone during a 3-year trial period and gives it unlimited access to the five countries’ markets.

One of the main features of this deal is that Iranian businesses can export their goods under “very low tariffs” to the Eurasian Union. Citrus such as apple, cultivated abundantly across Iran, will be one of those agricultural products that will make their way to the Union countries benefiting from the low tariffs. Dairy, food, fruit and industrial products will be other items on the list.  

Last week, Armenian Primer Minsiter Nikol Pashinyan visited Iran in a bid to hold serious talks and carry out “serious preparations” for Iran’s faster accession to the Russia-led bloc.

“The EAEU-Iran Free Trade Agreement creates new opportunities for trade and economic cooperation,” said Pashinyan in an interview with Islamic Republic of Iran News Agency (IRNA) ahead of his visit to Iran. “In the coming months, serious preparations are needed,” he stressed.

Head of the Armenian government called the FTA between Iran and the Eurasian Economic Union (UAEU) “new component” in Iran-Armenia relations. “I mean the EAEU-Iran free trade agreement, which will open up new prospects for trade and investment between participating countries,” Pashinyan was cited as saying by IRNA.  

Iran’s exports to Armenia stood at a little bit over 132 million dollars during the past 11 months, according to the latest figures published by the Iran Customs Administration (IRICA). The data show 42.37% rise in comparison to the same period last year. 

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