The Forum for Partners in Iran's Marketplace

August 2011, No. 60

Trade & Business

Expansion of Economic Relations

Iran-Turkey trade balance is in favor of Turkey without including
oil and gas imports by that country.

Iran's Ambassador to Turkey Bahman Hosseinpour in an interview has outlined bilateral efforts in further expansion of Tehran-Ankara relations:

How would you evaluate the present economic, cultural and tourism relations between the two countries?

Trade relations between Iran and Turkey have taken an upward trend in recent years to such an extent that the volume of bilateral trade in 2010 reached the record figure of $11 bn. Statistics over trade transactions of the two countries in the first quarter of 2011 lend further proof to the growing trend as the figure, enjoying a 74% increase over the same period last year increased from $1.8 bn to $3.54 bn.

As for bilateral cultural relations, with regard to common cultural, historical, religious and neighborly commonalties, gradually and through removing misunderstandings and in the light of emphasis of the leaders of the two countries on the need to further expand cooperation and communications, fortunately necessary grounds have been prepared for cultural cooperation. Also, proper understandings have been reached in scientific, education, academic, artistic and religious areas. Following mutual meetings of the officials of both the countries, several agreements were signed for further expansion of bilateral cooperation. Meanwhile, officials of the two countries believe that with regard to the existing potentials still there are numerous areas available for cooperation in such fields as arts, sports, handicrafts, youth, film making and TV serials.

With regard to tourism relations and grounds that have been prepared in Turkey, annually a large number of Iranian tourists visit Turkey. According to the announcement of Turkish officials, in 2010 about 2 million Iranians visited Turkey while the number of Turkish people visiting Iran was meager despite Iran's historical monuments. In line with this, the Iranian embassy has made utmost efforts in organizing several technical tourism committees in Tehran and Istanbul and in dispatching Turkish reporters and tourism company owners to Tehran. It also encourages Iranian partners to participate in relevant exhibitions and festivals in order to further represent tourism capacities in Iran and thus help increase the number of Turkish tourists to Iran.

The issue of expansion of Farsi language and literature in Turkish universities and colleges has taken a suitable course and has been widely welcomed by Turkish students.

Are you satisfied with the level of relations?

Bilateral relations in trade, tourism, cultural and academic areas in recent years, especially in the past three years, and with regard to the grounds which have been prepared for the expansion of relations in economic, trade and investment areas, are in the best possible situation to such as extent that the Leader in his meeting with Turkish officials described bilateral cooperation between the two countries in the past hundred years as unprecedented. Meanwhile, bilateral cooperation at regional and international levels has outstandingly increased and officials of both the countries are on constant consultation with each other. It seems that with regard to the provision of the required grounds, relations are moving and approaching forward rapidly. Therefore, it is expected that the designed perspective for trade relations of $30 bn would be realized within the next few years.

It seems that in the absence of any specific problem the $30 bn ceiling for trade exchanges and even more between the two countries could be realized within less than five years.

Is bilateral trade balance in Iran's favor and if the answer is negative what measures should be adopted to reach a positive balance?

Iran-Turkey trade balance is in favor of Turkey without including oil and gas imports by that country. Iran, in order to reach positive balance should produce non-oil products especially export-oriented commodities for export to Turkey and European countries while taking European standards into consideration. Presence of Iranian production companies in different Turkish exhibitions and efforts for presentation of Iranian manufactured commodities could reserve a place for such products in Turkey.

The Turkish ambassador says annually over 2.5 million Iranians visit Turkey while only 250 thousand Turkish tourists visit Iran. What can be done to strike a suitable balance?

The low number of Turkish tourists visiting Iran, despite the fact that Iran is among the top 10 countries in terms of cultural and historical sites, is due to lack of acquaintance of Turkish people with Iran's deep cultural history as well as lack of proper activities by Iranian tourism companies in Turkey and transparent strategies of tourism organizations in the field of attracting tourists. Meanwhile, expansion of infrastructures, training of skilled manpower, welfare facilities and offering suitable services are among requirements for expansion of tourism.

Establishment of expanded cooperation between tourism companies of both the countries could be highly effective in the field of exchange of tourists.

How many Iranian companies are active in Turkey in the field of economy and tourism and what are their specialty?

According to statistics released by Ankara Industry Chamber, by the end of 2010 about 1470 Iranian companies had been registered in that country but there is no information available about the number of those being active. It seems that most of them are active in the field of trade, a number in the field of tourism and some in investment.

In your opinion, what are the main problems and what measure do you suggest to be taken for their removal?

Major problems between the two countries in the field of trade could be listed as follows:

  •  Incompatibility of the standards of Iranian products with Turkish consumer goods and European customs union;

  •  Poor acquaintance of Turkish businessmen with Iran's trade culture;

  •  Weak cooperation of logistic companies of the two countries;

  •  Improper transit roads in eastern Turkey as well as in Iran's border areas;

  •  Absence of an institutionalized system in trade relations between the two countries such as preferential and free trade agreement for which negotiations are underway;

  •  Complexity of bureaucratic systems of the two countries as an impediment hindering expansion of economic and trade relations;

  •  Lack of acquaintance of Iranian tradesmen with diplomatic techniques and trade negotiations and lack of skill in motivating their trade partners;

  •  Incompatibility of Iranian tradesmen with market risks.

Please comment on the future expansion of bilateral trade up to $30 bn.

Under the status quo and with regard to the efforts made by the embassy and other relevant organizations of both the countries for the expansion of economic relations, including increasing border customs gates from the present three to five, removing tariff bottlenecks and for signing preferential agreements, trade relations are growing and statistics of the past three years lend further evidence to it.

It seems that in the absence of any specific problem the $30 bn ceiling for trade exchanges and even more between the two countries could be realized within less than five years. The $35 bn statistic for trade relations in the first quarter of the current year is indicative of the fact that in the case of continuation of such a trend, the figure would be increased to over $13 bn by the end of the year.


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  August 2011
No. 60