Zimbabwean exports to Iran fall from $4.8m to $1000 in a year

Speaking to the Parliamentary Portfolio Committee on Foreign Affairs, visiting Parliamentary delegation from Iran, Mr Mostafa Kavakebian lamented the low volume of trade between the two countries.

In the meeting, where members of parliament from both countries were present it came to light that volume of trade had fallen to a measly $1000. This is in stark contrast to the record exports to Iran of $4.8m achieved last year. Imports from Iran are falling too, from $400000 two years ago to $200000 last year.

Mr Kavakebian, who is the chairman of the Iran-Zimbabwe Parliamentary Friendship Group had this to say about the reason for the fall in exports,

We believe that there are serious problems in the banking sector in Zimbabwe, and would like banking relations to be improved because Iranian businessmen in Zimbabwe are saying that it is very difficult to transfer money

The various measures that were put in place to curb foreign currency leakages are now actually hurting foreign currency earning operations too.

As has been reported countless times, the indegenisation policy in this country is not clear and is a hindrance to foreign direct investment. Zimbabwe enjoys good relations with Iran but even still the Iranians are unclear on the indegenisation policy and expressed that they would appreciate clarification on it.

The Iranian ambassador to Zimbabwe, Ahmad Erfanian raised similar concerns, citing the difficulty in transferring money between the two countries as the major reason for the contracting trade volumes,

The level of exports between the two countries, according to our statistics, is very low and currently exports from Zimbabwe to Iran are $1 000. But last year, exports from Zimbabwe to Iran were $4,8 million, and two years ago exports from Iran to Zimbabwe were $400 000 and last year it was $200 000. When I speak to Iranian businessmen here, they say that the main problem is transfer of money between the two countries

After Zimbabwe decided to shun the west and ‘look east’ this unwelcome development is worrying. The problem on RBZ governor, Dr Mangudya’s plate is how to make it that measures restricting outflow of funds do not come back to affect inflows as well, like they currently are. The problem with restricting imports from certain markets is that you could get restrictions back in return. Not that that’s what happening in Iran.

The Zimbabwean ministers who were in attendance promised to sit with Dr Mangudya to discuss the concerns raised by the Iranians. We will see how the governor responds.

You can read more about the banking and cash crisis in Zimbabwe here.