New achievement in the five-year backward foreign trade of the head of state
According to Iran Gate statistics and figures, the data related to Iran’s trade volume in the first half of 1402 indicates a backwardness of the country to the 90s. The non-oil trade deficit of the country has also increased by over $4 billion in the first six months of this year compared to the same period in 1401.
According to a recent report by Mohammad Reza Ravanifar, the head of Iran Customs Administration, Iran’s trade balance in the first six months of 1402 has experienced an unprecedented decline compared to previous years. This is while Ibrahim Raeisi and members of the thirteenth cabinet always claimed an increase in oil exports and petroleum products and announced the availability of sufficient currency for importing goods. The Deputy Minister of Economy and the Head of Iran Customs Administration reported in this report about the worsening of the non-oil trade deficit of the country, which is an indication of the unfavorable situation of industries and subsequently the growth of the unemployment rate.
Report for the first six months of this year
According to Rezvani Far, the value of dollar-denominated exports and imports in the first half of this year has shown a significant decline compared to the same period in 2022. Additionally, based on this report, Iran’s foreign trade volume has also faced a noticeable decrease. The country’s non-oil trade deficit has also increased by over $4 billion in the first six months of this year compared to the same period in 2022.
According to the report by the Head of Iran Customs Administration, the value of dollar-denominated exports in the first half of this year has reached $24 billion. Furthermore, the value of dollar-denominated non-oil exports has experienced a decline of over 42% in the first six months of this year compared to the same period in 2022. It is worth noting that this figure has only been repeated three times in the past 10 years, and in the past five years, the country’s export level has reached its lowest point.
Regarding the value of dollar-denominated imports, we have reached a concerning figure of $3,044 billion, which has been unprecedented since Trump’s withdrawal from the JCPOA in 2018. Additionally, compared to the same period last year, we are witnessing a decrease of over $14 billion in the country’s import value, equivalent to a more than 30% decline in the dollar value of imports in the first half of 2023.
The decline in the country’s foreign trade volume
According to Rezvani Far, the volume of Iran’s foreign trade in the first six months of this year has reached approximately $54 billion. The statistics indicate a decrease of over 37% in the country’s foreign trade volume compared to the same period last year. Therefore, it can be said that the government of Ebrahim Raisi has recorded the lowest level of foreign trade in the past five years.
What is the reason for this decline?
Economists have repeatedly warned since the beginning of last winter that the Central Bank’s new policy could seriously damage the country’s foreign trade and subsequently the job market and the growth of industries in Iran. This policy, which aimed to control the exchange rate, put restrictions on the demand for necessary imported goods from the outset. This policy has laid the groundwork for the unprecedented decline in the country’s foreign trade volume in the past five years.
In fact, the central bank intended to suppress the demand and control the price of the dollar in the domestic market, keeping it around 49,000 to 50,000 tomans. It should be noted that despite the government’s claims, Ibrahim Raisi’s claims of an unprecedented increase in oil revenues, the central bank did not have sufficient access to foreign exchange resources, hence resorting to suppressing the demand side. This is while the behavior of the central banks of the Islamic Republic indicates currency dumping in the foreign exchange market in conditions of sufficient oil revenues. However, in two periods, the withdrawal of Trump from the JCPOA and the year 2023 of the Islamic Republic, due to the reduction in oil revenues, they were forced to adopt an alternative policy, which has been the suppression of the demand side in the foreign exchange market.
This policy has led to a significant decrease in the level of imports. Many industries that relied on importing raw materials faced difficulties in obtaining the necessary foreign currency. Naturally, this also caused a decrease in the production of non-oil products in the country. That is why we are witnessing a sharp decline in the volume of the country’s dollar exports in the first six months of the year 2023.
But the work doesn’t end here, as many analysts believe that the main effects of this policy will become apparent in the second half of this year. This is because many production units had stocked a portion of their required raw materials in warehouses, but these warehouses are now empty and naturally require foreign currency resources for imports. Therefore, it is expected that the country’s trade balance situation at the end of the year 1402 will be much more severe than what we are currently witnessing for the first half of this year.
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