Iran's Q1-3 Exports to Africa Triple

EghtesadOnline: Iran’s exports to African countries reached $912 million in the first nine months of the current fiscal year (March 21-Dec. 21), registering a 199% year-on-year growth ($600 million) in terms of value, according to the director general of Trade Promotion Organization of Iran's Arab and African Countries Affairs Department.

News ID: ۷۸۷۶۳۷

17 January 2022

Ghana with $292 million, South Africa with $169 million, Nigeria with $85 million, Sudan with $72 million, Algeria with $67 million, Kenya with $57 million, Mozambique with $55 million, Tanzania with $49 million, Somalia with $18 million and Ivory Coast with $14 million were the main export destinations during the period.

“The exports are expected to cross the $1 billion-mark by the end of the Iranian year [March 20, 2022],” Farzad Piltan was also quoted as saying by ILNA.

Imports from Africa to Iran stood at $40 million during the period.

With 54 countries, Africa is the second largest continent with a population of around 1.3 billion and has a higher economic growth compared to the world average.

According to TPO, Iran exported $580 million worth of goods to Africa in the last fiscal year (ended March 20, 2021).

Steel and iron semi-finished products and ingots, urea, rebar, cement, raisins, food pastes, sweets, chocolate, biscuits, pistachios and floor coverings were the main goods exported to Africa.

Iran’s fiscal 2020-21 imports from Africa stood at $96 million. The imported goods mainly included feed corn, manganese ore and concentrate, tobacco, tea, tuna, mining machinery and equipment, essence and herbs, zinc ore and fruit seeds.

Iran’s exports to African countries last year registered an 8% and 14% decline in tonnage and value respectively compared with the previous fiscal year, according to the Islamic Republic of Iran Customs Administration.

The intensification of US sanctions, the coronavirus pandemic, partial closure of global events and curtailment of trade relations were the main reasons behind the decline in Iran-Africa trade in the fiscal 2020-21, ILNA reported.

Problems on both sides are said to blame for the low presence of Iranian export products in African markets.

"From the Iranian side, lack of close communications and knowledge of African markets by the private sector, non-existence of planning and high marketing costs, lack of direct presence in African markets and shortage of infrastructure such as banking relations, transportation, etc. are among the most important problems and obstacles," Piltan said.

Besides economic and political instability, lack of proper administrative and security arrangements for long-term economic and trade activities, inadequate financial capacity of the private sector and African governments are among the problems and obstacles afflicting the African side.

The Trade Promotion Organization of Iran plans to introduce the export capabilities to African traders by using the capacities of the United Nations Economic Commission for Africa as well as Iranian embassies in African countries and other relevant institutions, while creating coordination at the domestic level and pursuing the establishment of trade infrastructure with Africa, such as development of transportation lines and establishment of banking relations.

TPO also plans to allocate €200 million to promote exports to African countries.

The funding will be part of a $2 billion support package approved by the National Development Fund of Iran (the country's sovereign wealth fund) to promote Iranian exports.

The package is aimed at removing hurdles to expanding foreign trade with African nations.

According to Hamid Zadboum, former TPO chief, the NDFI support would be given to exporters via designated banks over two years.

Money has been deposited with four banks, namely the Export Development Bank of Iran, Cooperative Development Bank, Bank Keshavarzi and the Venezuela Bi-National Bank.