Iran Economy Crumbling Under Burden Of Organized Regime Smuggling
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Iran Economy Crumbling Under Burden Of Organized Regime Smuggling

By: Pejman Amiri

For those living inside Iran the practice of smuggling goods, dubbed the underground economy, is actually considered a main part of the economy controlled by the mullahs’ regime. However, what many don’t know, especially those living abroad, is the actual scope and dimension of this unofficial economy of smuggling. This is playing a major part in destroying the country’s economy from within.

On smuggled goods the Secretary-General of the Iran Weaving Industry Association said, “Our customs have reported the country’s textile import at $5 million to $7 million, while the customs in China and the UAE have reported these numbers at $750 million.”

“Last year Turkey itself announced it had exported $800 million of clothing to Iran,” said the Director General of the Iran-Turkey Council of Commerce.

“Foreign clothing is now easily found in the market and every store… the clothing export statistics reported by the three countries of China, UAE and Turkey accumulate to a total of $1.55 billion,” state TV reported in Iran.

In a simple comparison between official clothing imports and smuggled imports we are faced with less than 0.5% against over 99.5%. In such calculations clothing imports from other countries such as South Korea, Taiwan and European countries are not even taken into consideration. If we do calculate those, the official import ratio in comparison to the smuggled goods nears a flat zero. Such conditions are not independent to textiles but all fields are more or less experiencing such a phenomenon.

“The import of home appliances is calculated annually at $450 million. However, the numbers published by inspector companies show the sale of $5 billion of foreign-made home appliances in Iran’s market. Some of these smuggled goods are entering the country through unauthorized piers that are very easily detectable,” said the president of the House Appliances Manufacturers Association in Iran.

“Every hour three 10-ton containers consisting of clothing, leather and shoes are smuggled into the country. These goods are brought into the country through different routes, such as free zones, authorized and unauthorized piers under different pretexts,” the Secretary-General of the Iran Weaving Industry Association added.

So-called unauthorized piers in which ships after ships docks and import or exports goods in and out of Iran have become so common that even the regime’s own officials have doubts over describing them as authorized or unauthorized!

These piers belong to powerful entities such as those under the supervision of Iranian regime supreme leader Ali Khamenei himself, the Revolutionary Guards and Ministry of Intelligence. The imports of goods by these entities abide by no specific rules or regulations, allowing billions of dollars in profits to be pocketed by the abovementioned powerful entities. This very trend is leading the country’s economy to further recession and destruction.

“Up to $25 billion of goods are smuggled into the country each year, of which 10% is allocated to clothing, leather and shoes. The status of domestic clothing manufacturers and textile productions is not good at all. This will only benefit the economies of other countries,” state TV reported.

According to economic calculations announced by the regime itself, for every $1 billion that is imported into the country, 100,000 job opportunities are lost and in fact 100,000 people become unemployed. Therefore, $25 billion of smuggled goods end in 2.5 million people added to the country’s unemployed population. This ratio only covers goods imported through official routes. The losses resulting from smuggled goods are actually much higher than anything discussed so far. When goods are smuggled into the market with no customs paid, they can be presented much cheaper in the market and there is no possibility for domestic producers to compete at all. The end result is a chain reaction of production units closing down and domestic production ending up in ruins.

Iranian president Hassan Rouhani’s minister of industries, mines and trade provided a solution to this problems.

“People should purchase foreign-made clothing. The best support we can provide is to buy domestic products!” he said.

Such remarks should come as no surprise. Those who are involved in the smuggling phenomenon in Iran are actually on duty to provide such preposterous recommendations. Why? If one actually follows the traces of this smuggling, it will lead directly to these very regime officials. This is just a small image of the immense corruption very much alive and quickly destroying the economy in Iran under the mullahs.

Follow Pejman on @PJ_arad


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