Iran exported goods and commodities worth $980 million during the five months, up 175% year-on-year.
Imports from Turkey grew by 53% from $523 million to $800 million, latest data by Turkish Statistical Institute say.
Iran and Turkey exchanged $401.9 million worth of goods and commodities in May 2021, 220% higher than the same period of last year.
Iranian exports to Turkey accounted for $204.9 million of the figure, up 280% YOY.
Iran’s exports to the neighboring country fell to $53 million in last May, mostly under the influence of the pandemic.
Turkey’s exports to Iran stood at $197 million, up 70% year-on-year.
Monthly trade between Iran and Turkey fell below $300 million in September, mostly due to a fall in Iran's exports to the neighboring country. However, trade started to improve in December, raising hopes for recovery from the impact of Covid-19 on trade between the two countries.
Bilateral trade stood at $3.43 billion in 2020, registering a decrease of 45.82% compared with 2019.
Iran exported $1.192 billion worth of goods to Turkey in 2020 to register a 66.9% year-on-year decline. Imports from Turkey stood at $2.245 billion, down 17.97% YOY.
Turkey’s collective value of exports amounted to $169.482 billion down 6.3%. The country’s imports amounted to $219.397 billion in 2020, up 4.3%, compared with January-December 2019.
62% Rise in Imports From Bazargan Border
Around 115,847 tons of commodities have been imported into Iran through Bazargan border crossing in West Azarbaijan Province since the beginning of the current Iranian year, showing a 62% growth compared with the similar period of last year.
“These good mainly included industrial machinery, steel, aluminum, plastic and rubber, automobiles, paint and ink, glue, rubber and textile,” Mojtaba Azgir, a local official, was quoted as saying by IRNA on Saturday.
Out of Iran’s 22 border crossings, Bazargan in Maku, Razi in Khoy, Sarv in Urmia, Sanam Baqi in Poldasht and Tamarchin in Piranshahr are located in West Azarbaijan Province.
Bazargan in Maku County is the most important Iranian land border for importing and exporting from and to Turkey. The city shares borders with Iraq and Nakhchivan Autonomous Republic.
Bazargan Customs Office was established in the fiscal 1926-27 and is the only international border between Iran and Turkey that works round the clock.
To stem the spread of Covid-19, Turkey in March last year shut its border gates with neighboring countries, including Iran and Iraq.
Bazargan’s border initially opened for trade in May 2020, but restrictions were applied regarding incoming and outgoing truck traffic.
According to Spokesman of the Islamic Republic of Iran Customs Administration Rouhollah Latifi, 60 Iranian trucks per day were allowed to transfer exports to Turkey from Iran as per new agreements as of May 5.
Trucks started arriving at border gates after Trade Minister Ruhsar Pekcan announced in June last year that Turkey has reopened the Gurbulak border gate with Iran (known as Bazargan on the Iranian side of the border).
Trucks from Iran started arriving at the Gurbulak customs gate after the announcement and entered Turkey after the completion of necessary procedures. Turkish trucks seeking to enter Iran also started arriving at the border gate.
Strict measures such as lockdowns and border closure deeply affected the country's exports, particularly to Europe, its top export market, and the Middle East.
Preferential Trade Deal Expansion
Finalizing ongoing negotiations with Iran for the expansion of the Preferential Trade Agreement is a priority for Turkey, Energy and Natural Resources Minister Fatih Dِnmez said earlier this year.
The trade deal came into effect on Jan. 1, 2015, and negotiations have been ongoing to expand the pact by increasing the number of traded products between Turkey and Iran, Donmez told the virtual 28th Turkey-Iran Economic Commission, Daily Sabah reported.
Customs cooperation was another topic up for discussion at the meeting. Within this scope, both sides agreed to an electronic data interchange protocol, to carry out a simplified customs frontier project and the mutual recognition of an Authorized Economic Operator project.
Donmez stressed that these projects will have a positive impact on foreign trade by enabling easier and faster trade while eliminating bureaucratic procedures based on mutual trust.
Both sides agreed that technical teams would meet in the near future to put the plans into action.
“The sides also agreed on increasing fairs and trade delegations between Turkey and Iran to show our [Turkey’s] concrete support and the great importance attached to cooperation between private sector representatives,” he said.
Support for the activities of the Turkey-Iran Business Council and other private sector establishments, notably small and medium-sized enterprises, would also continue, particularly after the pandemic, Dِnmez said.
Consequently, both sides agreed to commit to talks on developing an “action plan” between the Small and Medium Enterprises Development Organization of Turkey and its Iranian equivalent, Iran Small Industries and Industrial Parks Organization.
Donmez concluded that the commission also addressed other areas of cooperation, including health, energy, transportation, education, environment, agriculture and forestry.
Social Security Agreement
A business representative from Tehran Province said a Turkey-Iran Social Security Agreement inked on March 24 would help strengthen commercial and economic relations between the two countries.
Fatih Cayabatmaz from the Independent Industrialists and Businessmen Association also told Anadolu Agency that the agreement offers important opportunities for the business world.
"The implementation of Turkey-Iran Social Security Agreement will increase the Iranian businessmen's interest in Turkey.
Noting that Iranians were at the top of the list of foreigners establishing a company in Turkey, Cayabatmaz said, "In February, Iranians came first on the list with 75 companies. In addition to reinforcing relations, it will warm the two nations towards each other."
Cayabatmaz said that with the new agreement, Iranian businessmen who have founded the company in Turkey need to submit documents indicating that they paid insurance in their home country for the Iranian staff they employ, without having to pay insurance in Turkey.
"The time Iranian workers spend working in Turkey will be valid in Iran. This will reduce costs and increase the possibility of Iranian businessmen’s investment in Turkey. The same applies for Turkish businessmen operating in Iran and their personnel," he said.
He noted that health insurance for an employer would be valid in the other country, allowing workers to access health services free of charge.
A previous Social Security Agreement between Turkey and Iran, signed on April 16, 2016, was approved by the Turkish Parliament on March 24.
With the addition of Iran, the number of countries with effective social security agreements with Turkey rose to 34.
Property Investment
Iranians purchased 2,387 housing units in Turkey during the first five months of 2021 to remain atop the list of foreign buyers of property in Turkey.
Latest figures indicate considerable growth in the number of housing units in Turkey purchased by Iranians during the period compared with the previous year.
Iranians were followed by Iraqis with 2,248 house purchases over the five months under review. Russians with 1,459, Afghans with 1,027 and Kazakh nationals with 622 units came after.
Home sales in Turkey increased by 16.2% in May 2021 compared to the same month of previous year. Istanbul had the highest share with 19.2%. Ankara came next with a share of 9.6% and 5.6% respectively.
By implementing a series of policies aimed at attracting foreign direct investment in recent years, Turkey has succeeded in attracting many investors from regional countries, especially from the Middle East.
After the "Turkuaz Kart" (Turquoise Card), a practice similar to the US Green Card application, was launched in 2016, it became possible to get Turkish citizenship by investing in the country as of 2017.
Real-estate investment in Iran, particularly in megacities, used to be sensible and lucrative. However, it was driven to foreign states as investment risks increased with market volatility.
There are different speculations concerning the reasons behind this investment stagnation and the tendency toward overseas markets. Some experts cite lack of construction plans and failure to control real-estate prices in Iran as two contributing factor.