Iran Bans Importation Of Finished Products To Save Billions As Sanction Bites Harder

Iranian President Mahmoud Ahmadinejad pauses during a press conference on the sidelines of the Bali Democracy Forum in Nusa Dua, Bali, Indonesia, Thursday, Nov. 8, 2012. Ahmadinejad has criticized how much money was spent on the U.S. election.

Iran is banning the import of foreign-made cars, laptops, and other “luxury” goods in the hope of saving billions of dollars in hard currency, claims a report published by the state-owned IRAN daily.

The daily lists 75 products, ranging from luxury items like cars, watches or cell phones to basic, everyday things like coffee and toilet paper, that can no longer be purchased from abroad. The report quoted Iranian commerce chief Hamid Reza Safdel, who said import permissions were no longer being issued for the items listed.

Goods previously approved for import will still enter the country.

Iranians can no longer export gold without approval by the central bank, an official also announced in a new effort by the government to restrict outflows of wealth.

“The export of gold and coins without permission from the central bank has been banned,” said customs official Mohammad Reza Naderi, according to the Mehr news agency.

“According to law, (the export of) coins made from precious metals has until now not needed a permit from the central bank, but current economic conditions have resulted in a decision to require a licence from the central bank for the export of these goods.”

Naderi said the new policy was adopted because of exchange rate fluctuations and “challenges in the field of foreign trade”, Mehr reported without elaborating.

U.S. and European sanctions against Iran’s energy and banking sectors, imposed over its controversial nuclear programme, have slashed its oil revenues, which are the major source of its hard currency supplies.

The Islamic Republic’s residents who are worried about not being able to get their hands on a new gadget as finished products such as  fancy watch can relax, however – the ban apparently doesn’t cover components of said luxury items, only the finalized products.

Items assembled on Iranian territory – like watches or laptops – will still be available to anyone with the means to purchase them.

They may have to make do with local toilet paper, as that obviously can’t be assembled or imported in parts – and swap their coffee habit for tea instead.

The ban is aimed at saving Iran money in tough times – the country’s been hit hard by Western sanctions, and the daily claims the ban could save the Islamic Republic $4 billion annually. But critics argue it may boost smuggling from neighboring countries, which according to officials now comprises $15 billion worth of goods a year.

The Iranian government provides dollars at a rate of 12,260 rials each for specified priority goods. On the open market, a dollar costs around 30,000 rials.

The sanctions caused a slide in Iran’s currency, which has lost about two thirds of its value against the dollar in the open market over the past year and a half.
Iranian President Mahmoud Ahmadinejad attending an international Conference on Thursday ridiculed the expense of the U.S. election a day after voters kept President Barack Obama for another four years, mocking the American process as a “battleground for capitalists” while speaking at a democracy forum.

Ahmadinejad told the forum in Indonesia that democracy has become a system where the minority rules over the majority.

“Just take a look at the situation in Europe and the U.S.,” Ahmadinejad said during the meeting’s opening day on Indonesia’s resort island of Bali. An “election, which is one of the manifestations of the people’s will, has become a battleground for the capitalists and an excuse for hasty spending.”

The price tag for the 2012 U.S.  presidential campaign was the highest ever, soaring beyond $2-billion.

Ahmadinejad may be smarting because the international sanctions placed on Iran by the United States are starting to take their toll.