Exporters Ordered to Repatriate Proceeds Quicker

EghtesadOnline: Iran's First Vice President Es'haq Jahangiri has sent a directive to all ministries and other related entities, which requires exports to significantly accelerate the process of repatriating their proceeds into the country's economic cycle.

News ID: ۷۸۳۱۳۴

02 July 2018

As reported by IRNA late Saturday, the new directive was a modified version of the original directive issued about three months ago, requiring exporters to repatriate almost all their yields. The original tasked exporters to do so in a maximum of six months, but now they have been obligated to return their proceeds within two months.

The original directive was issued on April 23 by Jahangiri and obligated exporters to return 95% of their currency yields by accepting imported goods, reimbursing currency debts, selling foreign currencies to banks and exchanges, or making deposits in banks.

It was one of 16 measures approved by the Cabinet of President Hassan Rouhani shortly after the government abruptly unified the country's dual foreign exchange rate and announced that the new official rate of the US dollar is set at 42,000 rials, according to Financial Tribune.

It allowed exporters to keep the remaining 5% to spend it on marketing, advertisement and other costs. It also mandated exporters to report their activities in an online system specifically devised for this purpose and said they will face disciplinary action if they fail to repatriate their earnings.

The original version of the directive stated that "cases of returning foreign currencies earned from exports after more than six months will be decided by the Ministry of Industries, Mining and Trade".

The repatriation deadline for this section of the directive has also been set at two months and it looks like any exporter wishing to take more than that period of time to repatriate their proceeds will need to refer to the Industries Ministry.

The currency repatriation scheme has met with mixed response. A group of experts are of the belief that the initiative is necessary, considering the pressure the country is currently under while some exporters are unhappy that they are prohibited from investing their yields elsewhere.