Chairman of the Iran-Iraq Chamber of Commerce Yahya Ale-Eshaq says Iran’s exports to Iraq have slumped by 20 percent and urged Iran’s Central Bank to start talks for launching bartering system with Iraq.
Speaking to ILNA, Ale-Eshaq said that in case the bartering system is launched, some part of Iran’s problems would be resolved definitely, so the Central Bank due to its good relations with its Iraqi counterpart can consult on launching the bartering system.
On the current trend of trade between Iran and Iraq, he said the borders between Iran and Iraq for tourists and land travels have been closed by both sides due to hygienic reasons and it is no new issue but the trade goes on and one can say it is one of the best trade relations of Iran in the world.
Ale-Eshaq noted that of course, the priorities for Iran’s trade are China, Iraq, the UAE, Turkey, and Afghanistan, respectively.
“Unfortunately the trade volume at the global level has declined because of the Coronavirus pandemic and regional trade has also been affected by it and faced decline but both Iran and Iraq are determined to expand their trade.”
Ale-Eshaq added that the important thing is that all government officials, economic activists, and public organs are after expanding this market, adding that in case the international and regional conditions improve, Iraq market is a very good one, and Iran and Iraq’s trade relations, joint investments, commercial services and other issues will improve, too.
He deplored that the problem in the field of banking transactions and transfer of forex still remain, adding that although this trend continues it is very slow. He urged the Central Bank to reach a proper formula for the forex commitment of exporters in order to save the trade and to meet the bank’s demands but there is still no specific formula yet.
He noted that Iraq and Afghanistan markets are different from other markets and the Central Bank should adopt a certain formula for trade with these markets.
Ale-Eshaq added that Iran’s trade with Iraq is a little bit different because some part of it is done with national currency rial and some part with a suitcase and this is now impossible due to the Coronavirus; and some part of the money returns to the country via forex shops and some through private bodies which is actually different and they can be bartered with goods and sometimes the trade is done with Iraq national currency dinar or other currencies.
He emphasized the role of the bartering system for trade between both states, saying that in case this system is launched, major problems of Iranian traders would be resolved and urged the Central Bank to taking advantage of its good relation with its Iraqi counterpart for raising the issue and talks with Iraqis because Iran currently needs raw materials and some parts for production units and if the bartering system is implemented, it is possible for Iran’s forex revenues to return faster to the country.
On the trend of Iran’s exports to Iraq, he said Iran’s earnings from exports to Iraq in the first half of the year was around $3.5b while the figure was around $12b last year. He further said Iran’s exports in the first half of the year has declined by 20 percent comparing to the same period last year, reiterating that this decline is not just for Iran because the global trade has been affected by the virus and the global trade has slumped around 20 percent.