Iran’s annual non-oil trade at $73.9 billion, marks 10-year low

Iran’s foreign trade, excluding crude oil, declined to a 10-year low in the fiscal 2020-21.

8 May 2021
ID : 32864
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Iran's foreign trade, excluding crude oil, declined to a 10-year low in the fiscal 2020-21.

Non-oil trade decreased from $105.9 billion in the fiscal 2011-12 by an annual average of 3.9% to $73.9 billion in the last Iranian year that ended on March 20, 2021.

The intensification of sanctions in the fiscal 2011-12 led to, on the one hand, a sharp decline in the export of commodities like chemicals, petrochemicals and petroleum products, as well as nuts and dried fruits, and on the other, government restrictions on imports to economize on foreign currency until the fiscal 2015-16.

Amid heavy sanctions against the Islamic Republic, the government placed an all-out ban, or restriction on imports of commodities.

“A list of banned imports, including 1,600 items, was released by the government a few years ago to economize on foreign currency reserves in the wake of the US reimposition of sanctions. The number of these items increased to 2,262 last [fiscal] year,” Mehrad Ebad, a member of Iran Chamber of Commerce, Industries, Mines and Agriculture said in a write-up for the news portal of Tehran Chamber of Commerce, Industries, Mines and Agriculture. 

Minister of Industries, Mining and Trade Alireza Razm-Hosseini said the prevailing restrictions, or total ban on imports, will remain even if sanctions against Iran are lifted. 

“These measures are aimed at giving a boost to domestic production,” he was quoted as saying by IRNA. 

Razm-Hosseini said the production of parts in many industries have been localized, such that domestic manufacturers account for 75% of home appliance and 80% of car production.

Ups and Downs
The highest trade value during the 10 years under review was $104 billion registered in the fiscal 2014-15, of which exports accounted for $50.1 billion and imports for $53.6 billion.

Iran and P5+1 signed the Joint Comprehensive Plan of Action in July 2015, which culminated in the removal of international sanctions in January 2016.

United States ex-president, Donald Trump, withdrew from JCPOA in May 2018 and reimposed sanctions on Iran’s economy.

“The US withdrawal from JCPOA in May 2018 and the intensification of restrictions, especially in the field of currency transfer, caused a severe contraction in foreign trade. Under the circumstances, in addition to severe restrictions on the export of oil and petroleum products, non-oil exports also faced many problems,” Marjan Faqih Nassiri, the head of the Institute for Trade Studies and Research, was quoted as saying by ILNA. 

“The reduction of foreign exchange resources due to the decrease in exports naturally affected the volume of imports. However, in the fiscal 2019-20, despite the 7% decline in non-oil exports, due to the necessity of meeting the country’s needs and handling the domestic market, imports increased by 1.2%.” 

The value of exports started declining from the fiscal 2018-19 to reach $35 billion – the lowest in the 10-year period – in the fiscal 2020-21 from $47 billion in the fiscal 2017-18. 

During the period under review, the value of import fluctuated, such that it hit the highest of $54.5 billion in 2017-18 and the lowest of $38.9 billion in 2020-21.

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