Iran's Non-Oil Trade With Eurasian Economic Union Hit $1.4b in 8 Months

EghtesadOnline: Iran’s non-oil trade with the Eurasian Economic Union hit $1.4 billion during the eight months to Nov. 20, 2020, indicating an 11% decline compared with the corresponding period of last year.

News ID: ۷۸۵۷۲۳

06 January 2021

Non-oil trade with EEU’s five member countries accounted for 2.8% of Iran’s total foreign trade over the period under review, Tehran Chamber of Commerce, Industries, Mines and Agriculture reported, citing data provided by the Islamic Republic of Iran Customs Administration.

Exports to EEU stood at 1.8 million tons worth $639 million, registering a year-on-year decline of 20% and 6% in weight and value, respectively. Imports hovered around 2.33 million tons worth $772 million, posting a 15% growth in weight but a 14% decrease in value YOY.

Exports to EEU, in terms of value, accounted for 2.4% of Iran’s total non-oil exports during the period, indicating a 0.2% YOY growth.

Russia and Armenia were the top export destinations among five EEU member states during the period with $285 million and $233 million respectively. Russia was also the biggest exporter to Iran among EEU states with $727 million.

A total of 425 million tons of agricultural and food products worth $330 million were exported to the five EEU countries, which constitute 32.8% in weight and 51.6% in value of Iran’s total exports to these countries. The main agrifood export destinations were Russia with $246 million, Kazakhstan with $44.2 million and Armenia with $23.6 million.

Armenia

Exports to Armenia stood at 1.02 million tons worth $233 million, indicating a 27% decline in both weight and value YOY. Imports from Armenia stood at 5,000 tons worth $11 million, posting a 58% and 64% decline in weight and value respectively.

Belarus

Exports to Belarus stood at 4,000 tons worth $11 million, indicating a 52% and 74% rise in weight and value respectively. Imports from Belarus stood at 2,000 tons worth $5 million, registering a respective decline of 51% and 54% in weight and value compared with same period of last year.

Kyrgyzstan

Non-oil exports to Kyrgyzstan stood at 10,000 tons worth $19 million, indicating a 49% and 46% decline in weight and value YOY. Imports from Kyrgyzstan stuck around 8,000 tons worth $4 million, posting a decline of 3% in weight and 46% in value YOY respectively.

Kazakhstan

Exports to Kazakhstan stood at 176,000 tons worth $91 million, showing a 59% and 8% YOY decline in weight and value respectively. Imports from Kazakhstan stood at 65,000 tons worth $24 million, indicating 57% and 62% decrease in weight and value YOY.

Russia

Exports to Russia stood at 633,000 tons worth $285 million, registering a 37% and 29% YOY growth in weight and value, respectively. Imports from Russia hovered around 2.25 million tons worth $727 million, showing a 22% rise in weight but an 8% decrease in value compared with the same period of last year.

Trade Deal

Iran and Eurasian Economic Union signed a three-year provisional agreement in Astana, Kazakhstan, on May 17, 2018, for the bloc to welcome Iran into EEU. The arrangement, which lowers or abolishes customs duties, is the first step toward implementing free trade between Iran and the five members of the union.

The average tariff set by the Eurasian Economic Union on Iranian goods as part of a preferential trade agreement stands at 3.1%, while the figure is 12.9% for EEU goods exported to Iran.

Iran and EEU have listed 862 types of commodities in their three-year provisional trade agreement. As per the deal, Iran will enjoy easier export terms and lower customs duties on 502 items and the same goes for 360 items from EEU member states.

EEU removed tariffs on the import of 11 Iranian agricultural and food products in April. It conveyed the decision to Trade Promotion Organization of Iran in an official letter.

“These goods that can, from now on, be exported at a zero tariff include potato, onion, garlic, cabbage, carrot, chili, wheat, grains, rice and ready-to-eat meals for kids. The measure taken by EEU in these difficult times when the country is battling the Covid-19 crisis and economic sanctions can help boost our production and exports,” Reza Nourani, the head of Iran’s National Association for Agricultural Products, was quoted as saying by Fars News Agency.

Trade in Review

Majlis Research Center has reviewed trade between Iran and Eurasian Economic Union from the fiscal 2015-16 through to the last Iranian year (March 2019-20) in a recent report.

During the years under review, Iran-EEU trade reached its highest point of $2.4 billion in the fiscal 2016-17 while the lowest amount of trade was carried out the year before (fiscal 2015-16) with around $1.08 billion.

Based on the report, which draws on figures from Iran Chamber of Commerce, Industries, Mines and Agriculture’s International Affairs Department, Russia has been Iran’s main Eurasian trade partner over the five consecutive years under review.

Trade between Iran and the Eurasian bloc stood at $2.12 billion in the fiscal 2019-20. Exports to and imports from Russia reached $1.16 billion and $457 million respectively during last year.

The least amount of exports was made to Kyrgyzstan ($11 million) while Belarus with $12 million recorded the smallest export figure to Iran over the same year.

Iran-EEU trade registered $2.09 billion the year before (fiscal 2018-19) with exports to and imports from Russia standing at $1.34 billion and $280 million respectively. The least amount of exports was carried out to neighboring Armenia with 422.6 million. The lowest import figure that year belonged to Kyrgyzstan with $33.2 million.

Iran traded around $1.56 billion worth of commodities with EEU member states during the fiscal 2017-18. Exports to Russia stood at $727 million while imports from the country reached $292 million. The lowest amount of exports was made to Kyrgyzstan with 6.1 million the same year while Belarus accounted for the lowest export figure to Iran with around $1.7 million.

Over the fiscal 2016-17, Iran-EEU trade amounted to $2.4 billion. More than $1.54 billion worth of goods were exported to Russia while imports from the country reached $219 million. Again the lowest amount of exports was made to Kyrgyzstan ($3.5 million) while Belarus made the lowest amount of exports ($2.5 million) to Iran.

A total of 1.08 billion worth of products were traded between the two sides during the fiscal 2015-16, with exports to and imports from Russia standing at $517.4 million and $173.1 million respectively.

Kyrgyzstan with $1.7 million was placed at the bottom of Iran’s list of EEU export destinations and Belarus with $4 million made the lowest amount of imports to the country over the period.