Iran's Trade With China Declines to $11.6 Billion in Ten Months

Eghtesadonline: Iran’s commercial exchanges with its leading trading partner, China, reached $11.62 billion in the first 10 months of 2021, registering a 6.5% decline compared with the corresponding period of 2020.

News ID: ۷۸۷۳۶۸

04 December 2021

Latest data released by China’s General Administration of Customs show Iran’s exports to China totaled $5.24 billion during the period, indicating a 0.8% increase year-on-year.

In return, China exported $6.38 billion worth of commodities to Iran, indicating an 11.7% YOY decrease.

Bilateral trade stood at $1.2 billion in October 2021.

Iran’s exports to China stood at $425.98 million during the month while imports from China amounted to $772.34 million in October 2021.

According to the Islamic Republic of Iran Customs Administration, Iran-China non-oil trade stood at 30.12 million tons worth $18.71 billion in the fiscal 2020-21.

China accounted for 26% of Iran's total non-oil exports, as 26.58 million tons of non-oil goods worth $8.95 billion were shipped from Iran to China during the period.

Pistachio, nuts, minerals, construction materials, methanol, carpet, iron ore, glassware and fruits were the main types of goods exported from Iran to China in the last fiscal year.

Imports from China totaled 3.54 million tons worth $9.76 billion during the year to March 21, 2021, to account for 10.6% of the total volume of Iran's imports and 25.3% of the total value of imports during the period.

Industrial machinery and raw materials, medical equipment, paper, wood, textile, auto parts and sports equipment were Iran's main imports from the South Asian state in the fiscal 2020-21.

Iran’s non-oil trade with the East Asian country declined by over 10% last year, as bilateral trade totaled $20.82 billion in the year ending March 20, 2020.

25-Year Agreement and SCO Accession

Former Iranian foreign minister, Mohammad Javad Zarif, and his Chinese counterpart, Wang Yi, signed a 25-year cooperation agreement in Tehran on March 27, 2021.

The cooperation document had for the first time been discussed in 2015, when Chinese President Xi Jinping visited Iran.

The agreement pledges Chinese investments of $400–600 billion.

In a summit held in Dushanbe, Tajikistan, in September, the Chinese president announced the commencement of procedures to grant Iran full membership in the Shanghai Cooperation Organization.

Mohammad Lahouti, the head of Iran Export Confederation, said Iran’s accession to SCO is a watershed event for diplomacy, which can open up new frontiers for the country’s economy.

“Iran has unparalleled capacities through which cooperation with SCO members can be facilitated. The country is located on corridors linking north to south and west to east; Iran remains the most important corridor to cross West Asian region, although many countries tried to replace it over these years. According to available statistics, the country has one of the largest global oil and gas reserves needed by China and India, two key members of SCO,” he added.

Iran’s ascension to full SCO member was widely seen to be inevitable, considering the comprehensive strategic partnership agreement Iran signed with China in March and a similar agreement Iran subsequently signed with Russia.

According to Washington, DC-based think tank Jamestown Foundation, although SCO is mainly security and politically focused, membership in the organization also has an economic dimension, although this has been hampered in recent years largely by Moscow.

Still, participation in SCO has proven important for its members in developing bilateral trade and financial relations with one another and China in particular.

Iran will start down the path of becoming a full-fledged member of Shanghai Cooperation Organization at the next summit in September 2022, a Russian envoy to the eight-nation bloc said recently.

The Eurasian political organization is currently comprised of China, India, Kazakhstan, Kyrgyzstan, Pakistan, Russia, Tajikistan and Uzbekistan, with Iran as observer state.

"We expect a memorandum to be signed in Samarkand [Uzbekistan] in September 2022. This means Iran will begin the concrete process of accession," Bakhtiyer Khakimov told reporters on the sidelines of an SCO national coordinators' meeting in Tashkent.

Uzbekistan, which holds the rotating SCO presidency, has shared a draft memorandum listing conditions for Iran's accession with other members. Khakimov said every aspiring member state has a tailored list of criteria to meet, Sputnik International reported.