Iranian MPs Oppose Gov’t Trading Corporation’s Transfer to Industries Ministry

EghtesadOnline: All market regulatory functions have been restored to the Ministry of Industries, Mining and Trade as per the decision taken by the Supreme Council of Economic Coordination last week, which gave rise to the opposition of parliamentarians.

News ID: ۷۴۸۰۱۸

29 July 2019

“The government believes that Iran's commercial sector should be led by an integrated authority,” Deputy Industries Minister Hossein Modarres Khiyabani told a presser on Saturday, Mehr News Agency reported.

“Therefore, market regulatory policymaking and other responsibilities, including setting tariffs and customs duties for agricultural products as well as their pricing, export and import, which had been handed over to the Agriculture Ministry in the fiscal 2014-15 were transferred to the Ministry of Industries, Mining and Trade last week.”

The Government Trading Corporation of Iran and State Livestock Affairs Logistics Incorporation, affiliated to the Agriculture Ministry, will go under the exclusive control of the Industries Ministry’s Commerce Department, along with the Export Guarantee Fund of Iran, Institute for Trade Studies and Research, e-Commerce Development Center of Iran, Iran National Carpet Center and Trade Promotion Organization of Iran, according to Financial Tribune.

GTC is a government-owned company specialized in the purchase, import and distribution of essential foodstuff. It has been serving as the lever for enforcing market controls.

The company is also in charge of maintaining the steady supply of wheat, rice, cooking oil and meat, as the country’s strategic reserve of essential commodities.

In compliance with the new decision, Deputy Agriculture Minister Ali Akbar Mehrfard called on Agriculture Ministry’s directors, in a letter, to stop approving any import order registration requests, except for pesticides, livestock pharmaceuticals and supplements, seeds and genetic content of livestock as of July 27, 2019.

The announcement met with the opposition of parliamentarians.

“The decision made by the heads of three branches of power [executive, judiciary, legislative] on the separation of Government Trading Corporation of Iran from Agriculture Ministry will definitely harm agricultural production and might spell the end of self-sufficiency achieved in producing strategic goods, including wheat and sugar,” Ali Akbari, a member of Majlis Agriculture Commission, told Fars News Agency. “The new development is aimed at increasing imports and regulating market through foreign commodities,” he added.

Echoing the same remarks, Seyyed Razi Nouri, another member of Majlis Agriculture Commission, said GTC’s transfer to Industries Ministry is synonymous with paving the way for importers, those who are willing to pour foreign products into the country.

“This was an emphatic win for rent-seekers,” Ali Khanmohammadi, managing director of the National Assembly of Agriculture, was quoted as saying by ILNA.

"From now on, we will bear witness to the decline of agricultural development since the Industries Ministry’s policy is not to promote production, as it favors imports," he said.