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Customs laws eased to boost exports

TEHRAN, Sept 14 (Reuters) - Iran is moving to ease customs barriers as part of attempts to increase non-oil exports and reduce reliance on petroleum-related earnings, a senior economy official said.

Boosting Iran's flagging non-oil exports has been a central goal of the economic recovery plan President Mohammad Khatami launched a year ago.

"The government and the entire system are resolved to support non-oil exports so customs is trying to streamline itself in a bid to encourage exports and production," Mehdi Karbasian, deputy economy minister and head of the customs, told Reuters in a recent interview.


Karbasian, appointed after Khatami's election in 1997, said he was trying to modernise the antiquated customs system, widely seen as intrusive and uncooperative.

Until recently travellers had to spend hours at airports as customs appraisers meticulously went through the contents of their luggage. Importers had to secure permits and clearances from myriad government agencies before they could get their shipments released.

The situation has improved somewhat with authorities showing greater trust in customs declarations and limiting their probe to random checks.

"We are adopting a policy of respect for people, and are going from visible checks to invisible checks. We seek stable regulations and less bureaucracy," Karbasian said.

"By computerising and decentralising the system, we have reduced to two hours customs procedures for shipping out a consignment, from several days before. Such moves have helped to increase non-oil exports after several years of decline," he said.

The official said non-oil exports reached $1.305 billion in the five months to August, a 31.5 percent increase from the same period a year ago, and predicted the figure to rise to $4 billion for the entire Iranian year, which ends in March 2000.

Iran's non-oil exports have steadily fallen since May 1995, when the former government reinforced exports regulations in an attempt to control capital flight.

These measures, which required exporters to repatriate their earnings and exchange them at the undervalued official rate, discouraged exports. Last year, the country earned only $3 billion from non-oil exports, nearly half of earlier projections.


In parallel, the cash-strapped government has sought to curb imports and save hard currency to pay back billions of dollars in foreign debt.

This move has further hampered export growth by making it difficult for manufacturers to import raw material and spare parts -- which, along with basic foodstuffs, make up the bulk of Iranian imports, estimated at $14.5 billion last year.

"If we try to restrict imports, our exports will eventually be hurt, too," said the U.S.-educated Karbasian. "We are part of the world trade and have to find our place there."

He said another incentive for easing customs regulations was the goal of meeting requirements by the World Trade Organisation (WTO), which Iran has unsuccessfully tried to join.

"We can not be left out of an organisation with 140 members. We must adjust ourselves with international trade rules so long as it does not hurt our economy," he said.

Karbasian said customs laws would undergo fundamental changes under the economic plan, to be shortly debated by parliament, to ensure trade regulations at least partly conform to WTO standards.

The plan calls for tariffs and taxes to be collected all at once and supervision on foreign trade to be narrowed down to the commerce ministry.

"Problems are being solved one at a time; we have to accept that the situation can not be corrected over night," Karbasian said.


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