Irandaily | No. 4434 | Domestic Economy

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Bolstering Ties With Armenia Underlined

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Iran-Armenia Joint Chamber of Commerce by conducting activities including launching Iran’s trade center in Armenia plans to increase private sector’s share in the two countries’ relations.
Head of the chamber, Leon Aharonian, said by launching the center, Iran will become Armenia’s first trade partner.
The managing director of Iran’s Trade Center in Armenia, Shahrokh Zahiri, and Leon Aharonian, in an interview with Iran Daily explained about the two countries’ relations and details of launching the center.
The excerpt follows:
IRAN DAILY: Mr. Aharonian would you explain about the role of Iran-Armenia Joint Chamber of Commerce in boosting the two countries’ ties?
LEON AHARONIAN: Iran-Armenia Joint Chamber of Commerce was established about 19 years ago. During these years, we have held 16 exhibitions in Armenia. However, holding such exhibitions is not effective alone in bolstering transactions anymore.
Although, Iran sends 40,000-45,000 trucks of goods to Armenia per annum, so far, we have not been able to prepare a small storehouse to stock up the goods and perform trade affairs. This issue had caused transactions between the two countries not exceed $220 million.
However, at present, a complex called Iranian Free Trade Center extending over 20,000 square meters is being constructed by joint chamber of commerce in Armenia. The complex has a storehouse extending over 4,000 square meters. This center can act as a launch pad for Iranian goods to be re-exported to Georgia, countries in Caucasus region and Russia.
This trade center will play a significant role in boosting the two countries trade.
Mr. Zahiri, as the managing director of Iranian Trade Center in Armenia, please elaborate on the details of implementing this plan.
SHAHROKH ZAHIRI: This center has been established after reaching an agreement with Trade Promotion Organization of Iran. All the countries’ chambers of commerce should prepare the grounds to establish cooperation among those companies with which they have trade relations and the center by sending Iranian goods to it. Therefore, domestic companies can buy shares and establish their offices there, through assistance of chambers of commerce. They can also use the center’s storehouses.
This center will have more than 1,400 meters of exhibition hall. It will also have separate fridges to store fruit, citrus and meat. It is slated that each month, exhibitions will be held in the center by companies from two Iranian provinces. Thus, Iranian products will always be showcased in Armenia.
Mr. Zahiri, what other facilities will be granted to Iranian businessmen and producers in this center?
By reaching an agreement with Armenian government, goods which will be stocked in the storehouses of the center, will be exempt from paying customs tolls and duties.
This will have a number of advantages for Iranian businessmen and producers. On one hand, they can store their goods there without first being forced to pay customs tolls and duties. And on the other hand, if Iranian businessmen decide to export their goods to countries other than Armenia, they do not have to pay tolls and duties.
Iranian producers can send their goods to the center in bulk and there, using the packing facilities, the center provides them with packing them and sending the final product as Armenian goods to other countries. These products will be exempt from paying customs duties, because as stipulated by the contract of Commonwealth of Independent States, the contracting parties can send their goods to each other without being forced to pay customs duties.
Mr. Zahiri, how do you evaluate the physical progress of the center? When will it be launched?
The construction of the center will need several million dollars which will be procured by selling shares. To sell the shares, we will travel to different province’s chambers of commerce. So far, we have offered and sold shares in the provinces of Yazd, Isfahan, Razavi Khorasan, Markazi and East Azarbaijan. The procedure of selling shares will finish within the next two months.
Currently, central storehouses are almost ready. Construction of other sectors will begin in March. According to the schedule, next September, the center will be inaugurated.
Mr. Aharonian, as the head of Iran-Armenia Joint Chamber of Commerce, how do you evaluate ties between the two countries?
Currently, relations between the two countries are favorable. Annual transactions stand at $400 million. We import 60,000 tons of commodities to Armenia by trucks per annum. However, we should familiarize Armenian people with Iranian goods.
Trade balance between the two countries is 80 percent in favor of Iran. Iran’s exports to Armenia amount to $300 million, while our exports are less than $100 million. Iran exports cosmetics, food, construction materials and agro products. In return, we import machineries, lifttruck, silk materials and textile.
Have sanctions hindered trade with Armenia? Have they affected Iran’s exports?
We do not face problems caused by sanctions in our mutual trade. Both sides’ businessmen have sorted out strategies to circumvent sanctions. Our exports to Armenia will exceed that of last year, because, previously, we did not export petrochemicals to Armenia.
Are there any major projects underway by any of the two countries that can boost mutual ties?
Armenia is gradually realizing that having relations with Iran is of the outmost importance. They used to think that having relations with Russia is in their interest, therefore, they relied on Russia a lot. However, they finally found out about Iran’s trade potentials.
At present, both countries have close cooperation in energy exchanges. Iran sends gas to Armenia and imports electricity when it feels the need. As the result of their join meeting in October, they began construction of a hydroelectric power plant on Aras River on their common border.
The power plant will have the production capacity of 170 megawatts (MW) of electricity. Iran will invest $700 million implement the project. Once completed, the generated electricity will be sent to Iran until Armenia clears its debt to Iran. Then, 90 MW will be sent to Iran and 80 MW to Armenia.
We are also constructing a railroad from Iran to Armenia’s border and Jolfa. The railroad will also pass through Central Asia and countries including Tajikistan and Uzbekistan. This railroad will complete the North-South Corridor.