Iran's Handmade Carpet Exports Earn $30m in Seven Months

EghtesadOnline: A total of $30 million worth of hand-woven carpets were exported from Iran during the first seven months of the current Iranian year (March 21- Oct. 22), the head of Iran Chamber of Cooperatives’ Handicrafts and Tourism Commission said.

News ID: ۷۴۹۲۵۴

22 December 2019

Abdollah Bahrami added that the country’s handmade carpet exports amounted to $420 million in the last Iranian year (ended March 20, 2019), ILNA reported.

“Currently, 6,000 people are working in the hand-woven carpet industry,” Financial Tribune quoted him as saying.

According to Bahrami, the UAE, China, Germany and South American nations are the main customers of Iranian hand-woven carpets.

“Iran has exported $1.5 billion worth of hand-woven carpets in the last two decades,” he said.

Following the reimposition of US sanctions, exports have declined.

Iran and six world powers, namely the United States, Britain, France, China, Russia and Germany, signed an agreement dubbed Joint Comprehensive Plan of Action in 2015, under which Tehran agreed to limit the scope of its nuclear program in return for sanctions relief. It was implemented a year later and led to removal of years of international sanctions against Iran.

However, US President Donald Trump quit the deal in May 2018 and unleashed two waves of sanctions, one in August and another in November, described by Washington as "toughest ever" aimed at choking Iran's trade with other countries.

Subsequently, the United States, which was previously the biggest buyer of Persian hand-made carpet, stopped importing. It used to import $80-100 million worth of carpets annually prior to sanctions.

Fereshteh Dastpak, the head of Iran National Carpet Center, said plans are underway to establish a barter system to trade Persian hand-woven carpet for other commodities.

She said China, a major buyer of Persian handmade carpets, has expressed its readiness to apply such a system to import Iranian carpets in exchange for subway wagons.

Sweden and Russia have also offered to trade Iranian carpets for a range of other commodities.

"More than 95% of raw materials to produce hand-woven carpets in Iran are produced domestically," she said.

According to the official, Iran imports 90% of the silk it needs to produce carpets from China.

One of the most important problems exporters are dealing with these days, Dastpak said, is the limitations imposed by the government for currency repatriation.

As per a directive devised in the wake of a currency crisis in Iran, the government has obliged all exporters to repatriate their foreign currency yields into the economic cycle of the country.

The move is aimed at boosting strained currency reserves, at least in the short term, under increasingly harsh conditions. But it has understandably received negative feedback from private sector players.

According to Dastpak, about 80% of hand-woven carpets produced in Iran are exported.

“The product has always been among the top three non-oil export commodities of Iran even through the worst years experienced by the country's economy. Handmade carpets are deemed Iran’s second flag and a symbol of Iranian identity and culture,” she said.