Iran's Trade With Persian Gulf Countries Surpasses $20 Billion in 8 Months

EghtesadOnline: Iran traded 41.16 million tons of goods worth $20.05 billion with Persian Gulf littoral states, namely Iraq, Kuwait, Qatar, the UAE, Bahrain and Saudi Arabia, during the current fiscal year’s first eight months (March 21-Nov. 21), according to the latest data released by the Islamic Republic of Iran Customs Administration.

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09 January 2022

The UAE was Iran’s top trade partner among the Persian Gulf states under review with 15.31 million tons worth $13.01 billion. It was followed by Iraq with 23.16 million tons worth $6.84 billion, Qatar with 785,421 tons worth $103.89 million, Kuwait with 1.91 million tons worth $91.35 million and Bahrain with 7,710 tons worth $6.19 million.

Iran’s exports totaled 31.63 million tons worth $9.26 billion.

Iraq was the main export destination with 21.64 million tons worth $6.13 billion and was followed by the UAE with 7.29 million tons worth $2.94 billion, Qatar with 783,714 tons worth $97.29 million, Kuwait with 1.91 million tons worth $91.35 million, Bahrain with 7,288 tons worth $4.89 million and Saudi Arabia with 429 tons worth $41,018.

Imports stood at 9.53 million tons worth $10.79 billion.

The UAE topped the list of exporters to Iran among Persian Gulf states with 8.02 million tons worth $10.08 billion. It was followed by Iraq with 1.51 million tons worth $706.86 million and Qatar with 1,706 tons worth $6.6 million.

Iran’s total foreign trade reached 110.3 million tons of goods (excluding crude oil) worth $63.1 billion during the period under review, registering a 43.5% and 40% year-on-year growth in terms of weight and value respectively.

Exports stood at 83.7 million tons worth $31.1 billion, 10.5% and 42% higher in terms of weight and value respectively YOY, IRNA reported.

Petrochemical exports with 39.8 million tons worth $13.3 billion had the biggest share in exports, accounting for 47% of total weight and 43% of total value.

China with 19.3 million tons worth $9.1 billion, Iraq with 21.6 million tons worth $6.1 billion, Turkey with 11.3 million tons worth $3.8 billion, the UAE with 7.3 million tons worth $2.9 billion and Afghanistan with 3 million tons worth $1.27 billion were the top five export destinations.

Imports stood at 26.5 million tons worth $32 billion, registering a 38% and 21% increase in weight and value respectively.

Top five exporters to Iran were the UAE with 8 million tons worth $10.1 billion, China with 2.2 million tons worth $7.2 billion, Turkey with 2.7 million tons worth $3.2 billion, Germany with 549,000 tons worth $1.2 billion and Switzerland with 1.3 million tons worth $1.1 billion, respectively.

Iran’s trade with Persian Gulf littoral states stood at 50.76 million tons worth $22.36 billion in the year ending March 20, 2021.

Resumption of Trade With Saudi Arabia

After a one-and-a-half-year hiatus in trade, Iran exported $39,000 worth of commodities to its southern neighbor Saudi Arabia since Ebrahim Raisi’s presidential term began in August, the spokesman of the Islamic Republic of Iran Customs Administration said recently.

“Out of the overall sum, $33,000 pertained to a specific type of glass used in traffic signs and $6,000 belonged to tiles,” Rouhollah Latifi was also quoted as saying by Mehr News Agency.

“This marks a new beginning in Iran and Saudi Arabia’s economic, political and cultural relations after the two countries began negotiations to solve tensions.”

Sadreddin Niavarani, a member of the board of directors of Fruit and Vegetables Exporters Association, says Saudi Arabia can be a big market for Iranian agricultural products.

“Before tensions emerged between the two countries, Iran used to export around $1 billion worth of agricultural commodities to the Arab country annually. Our main exports were apple, kiwi, apricot, cherries, peach and nectarine,” the official told ILNA.

“The Saudi people have always taken a liking to Iranian products. There are no hard feelings between the businesspeople of the two countries and old trade partners have continued working with each other despite political issues.”

The official noted that the two sides continued trade exchanges even during tense ties, as commodities were traded through intermediaries.

“During the period and before negotiations started, Iranian products first went to countries such as the UAE, where their labels of origin would change and then the consignments were reexported to Saudi Arabia,” he added.

Niavarani believes political tensions can never cause serious and everlasting obstacles to commercial and financial interactions between the two nations.

“Agricultural products, in particular, will eventually find their way to their intended markets. Iran has high-quality agricultural products, which have their own consumers in destination markets. At present, people in Saudi Arabia prefer to purchase Iranian apples instead of Turkish ones for double the price,” he said.

Prince Faisal bin Farhan al-Saud, the Saudi foreign minister, said recently the kingdom is “serious” about talks with Iran, signaling Riyadh’s desire to repair relations between the two regional powers.

The kingdom has held a series of talks with Iran since President Ebrahim Raisi took office. These negotiations reflect a tentative de-escalation in the region, following the election of US President Joe Biden and the economic hardship wrought by the pandemic.

Riyadh and Tehran cut diplomatic ties in January 2016 after the Saudi Embassy in Tehran was stormed by protesters after Saudi Arabia executed a senior Shia cleric Sheikh Nimr al-Nimr without due process.

Tensions between Saudi Arabia and Iran soared after Riyadh backed former US president, Donald Trump’s decision in 2018 to unilaterally withdraw from the nuclear deal with Tehran and impose tough sanctions on the Islamic Republic.

But Saudi Arabia appeared to have recalibrated its more assertive foreign policy after Biden took office and pledged to reassess relations with the kingdom, criticizing the murder of veteran journalist Jamal Khashoggi by Saudi agents and freezing some arms sales to Riyadh.

Prince Faisal said there was a “confluence of events that made it feel like it was the right moment” to talk to Iran.

“We were always willing to talk, if they might actually be serious,” he said. “Various factors came into play.”

Iranian Trade Center Inaugurated in Dubai

Iran’s first trade center licensed by the Trade Promotion Organization of Iran was inaugurated in Dubai.

As Iran Chamber of Commerce, Industries, Mines and Agriculture reported the center is aimed at helping Iranian companies in finding a foothold in the UAE, Dubai in particular, which happens to be one of the main hubs of Iran’s trade in the region.

It also seeks to use advanced information technology to create a platform that facilitates business activities of Iranian firms in the Emirati market by providing technical advice and consultation services.

The inauguration came after a senior Emirati official recently said the UAE would soon send a delegation to Iran as part of efforts to improve ties with Tehran.

"I hope that it is the sooner the better and all our friends are aware of it," Anwar Gargash, diplomatic adviser to the UAE president, told reporters when asked when a UAE delegation would hold talks in Tehran.

The idea was to "turn over a new page" in relations, he was quoted as saying by Reuters.

Iran’s Foreign Ministry has voiced the administration’s determination to broaden relations with the neighbors, including the UAE, calling for constant consultations between Tehran and Abu Dhabi.

Sheikh Tahnoon bin Zayed Al Nahyan, the UAE’s top national security adviser, paid a visit to Iran recently for high-level talks that are seen as a possible sign of thawing relations between the two countries.

He expressed Abu Dhabi’s readiness to expand cooperation with Iran, hoping that a visit by the Iranian president would help open a new chapter in the two countries’ relations.

“We are the children of this region and share the same fate, so expansion of bilateral relations is on our agenda,” Sheikh Tahnoon said in a meeting with Raisi in Tehran, President.ir reported.

He also extended the Emirati president’s official invitation to Raisi to visit the Persian Gulf Arab country.

The Emirati senior advisor also met his Iranian counterpart, Ali Shamkhani, and held detailed negotiations that, he said, would be a turning point in bilateral relations and help improve regional security.

“Iran, as a great and strong country in the region, enjoys a unique geopolitical position as it is the gateway between the east and the west,” he said.

“Developing brotherly relations between Abu Dhabi and Tehran is a priority of the UAE. It is essential to establish expert working groups to work out areas for joint cooperation in various economic sectors and identify the impediments to remove them.”

Shamkhani also expressed hope that the Emirati official’s visit would be the beginning of a new era of mutual relations and pave the way for expansion of ties in all sectors.

Iran and the UAE have had business ties stretching back over a century, but they have been on different sides on certain issues, including the war in Yemen.

Sheikh Tahnoon’s visit comes amid Abu Dhabi’s efforts to deescalate tensions with Iran as part of a policy choice toward diplomacy and away from confrontation.