Iran’s export credit guarantee issuance set to rise by March

Export Guarantee Fund of Iran (EGFI) is expected to issue export credit guarantees worth $2.5 billion by the end of the current fiscal year in March 2019.

Deputy head of Export Guarantee Fund of Iran, Arash Shahr-Aini noted that following Washington’s withdrawal from the 2015 nuclear deal between Tehran and world powers on May 8, foreigners have concerns and face limitations in investing in Iran and open letters of credit (L/Cs) for business transactions, Trend News Agency reported.

In the past two months, the country’s export finance cover has witnessed a major increase, reaching $300 million in value, he added.

Shahr-Aini said he expected the figure to rise to $2.5 billion by March based on the current circumstances.

This is while the amount stood at $1.9 billion during the same period last year, he said.

The official further said that non-oil exports have witnessed a 40-percent rise in the past two months, noting that exports of gas condensate and petrochemical products were not part of it.

Shahr-Aini stated that the recent rise in non-oil exports is due to fluctuations in Iran’s foreign exchange market, noting that private sector exporters will be exempted from the government’s new restrictions.

“There is no need for exporters to submit their foreign currencies to the Central Bank of Iran (as had been set out by the government) after their trade. They can use them for imports.”

On April 9, Iran unified the official and open market exchange rates after its currency, the rial, plunged to an all-time low on concerns over a return of crippling sanctions.

After an emergency cabinet meeting, Iran’s First Vice President Es’haq Jahangiri was quoted by the state media as saying that from April 10 the price of the dollar would be 42,000 rials in both markets and for all business activities.