Baku, Azerbaijan, Jan. 25
By Fatih Karimov - Trend:
Iran's textile industry is suffering from a preferential trade agreement with Turkey.
Mehdi Yekta, the secretary of the Iranian textile producers and exporters union, said importing textile products from Turkey based on preferential rates will harm the domestic textile industry, Iran's Fars news agency reported on Jan. 25.
Yekta went on to say that imports meet 80 percent of the Iranian market's textile needs. China and Turkey respectively account for about 60 percent and 40 percent of textiles exports to Iran, he added.
The preferential rates are applied to carpet threads, fabrics, clothing, and machine-made carpets, he noted.
The government has reduced the tariff for importing Turkish textile by 40 percent, he said, adding that based on the Central Bank's data Iranians buy about $8 billion of clothing per year.
Preferential trade agreement is a pact that reduces tariffs for certain products to the countries who sign it. While the tariffs are not necessarily eliminated, they are lower than countries not party to the agreement. It is a form of economic integration.
In January 2014, Iran and Turkey signed the agreement with the goal of boosting bilateral trade.
The preferential trade agreement took effect on January 1, 2015.
According to the agreement, 125 items of Iranian goods and 140 items of Turkish goods will be traded based on preferential.
