According to the International Exhibition of Iranian Stone, export risks are one of the most important challenges in the export process. Maintaining position and influence in existing markets and validating new markets are two essential factors in this regard. One of the things that happened during the sanctions was to limit and reduce the number of Iranian export markets.

Our destination is more than 80% of our exports in these five countries, and this high concentration of export destinations is not appropriate in terms of risk assessment, and it is obvious that when a market is in trouble, a wide range of our exports will be in trouble. Diversifying Target Markets as an Export Development Strategy It is very important for professional exporters to gain sufficient knowledge before entering a new market and to validate the foreign buyer.

In the current situation, both the country faces sanctions restrictions and simultaneous shocks in supply and demand, as well as economic problems caused by Covide Nineteen, and banks generally put themselves in a safe position and minimize funding. . On the other hand, commercial insurances, affected by the existing risks, are retreating. The Export Guarantee Fund has more support for exporters than ever before, and has even increased the level of risk coverage and reduced the franchise of insurance policies. In addition, increasing the credit ceiling of customers and deferring the debts of exporters are on the agenda.

 How do you assess Corona's impact on foreign trade and the country's economy?

Prior to Corona's spread, Iran's exports fell as a result of sanctions, with EU exports to Iran halved in 2019 compared to the previous year, but their imports from Iran quadrupled. The International Monetary Fund estimates Iran's foreign trade will fall to about $ 70 billion in 2020 with a reduction of $ 16 billion.

The outbreak of the corona virus has limited Iran's exports to neighboring countries. While about half of the country's revenue comes from regional trade channels, Iran's neighbors have closed their borders with the country one after another. Therefore, Iran's exports are declining sharply.

Disturbances in exports from land borders, declining tourist inflows and outflows, declining global oil prices and demand, and declining exports, along with disruptions in trade with China, are among the main consequences of the spread of the virus in foreign trade.

On the other hand, the International Monetary Fund estimates that Iran's foreign trade will reach about $ 70 billion in 2020 with a reduction of $ 16 billion. Also in the new year, two important events that could shape the formation of a new parliament and the election of the President of the United States will affect Iran's foreign trade.

Due to restrictions on trade and foreign trade, the supply side of the currency will decline, but due to declining imports and travel, demand for foreign exchange will also decline, and there will be no significant fluctuations in the dollar rate until at least the end of May.

In general, if the outbreak of the virus in the first quarter of the year is completely over, economists can expect production to return to normal, and in the first six months of the year, with inflation of about 25 percent, economic growth will be close to zero. It will not be far from expected. However, if this spread is prolonged, the above analysis will be discredited and it seems that the country will enter an economic recession and we will see an inflationary recession in the first six months of the year. As if the International Monetary Fund had forecast inflation of 31 percent for Iran's economy in 2020. In pessimistic conditions, Iran's domestic production is likely to fall to two-thirds of the current level (down 33 percent) and a budget deficit of about $ 10 billion this year.

How do you assess the government's support package to deal with the corona in relation to the country's economic situation, as well as the actions taken in other countries?

The support package designed by the government and the central bank includes various programs and measures, such as granting facilities to damaged businesses, helping the unemployment insurance fund, cash support from low-income groups, supporting taxpayers, etc., which are more or less similar to packages. Designed in other countries.

However, it should be noted that the most important thing for Iran is the loss of the lucrative and lucrative market for Eid and Nowruz celebrations for Iranian businesses and businesses, which will further damage the livelihoods of Iranian households in the coming months.

As a result, the volume of the economic stimulus package is of great importance, while studies show that a much smaller volume has been allocated for the prevention of the recession in Iran than in other countries. An indicator of this comparison is the ratio of the volume of the stimulus package to the GDP of each country, which is about 30 percent in Oman and Bahrain, about ten percent in the United Arab Emirates, Qatar and the United States, and thirteen in Singapore. And in the UK and Saudi Arabia it is four percent. While Iran's volume of economic stimulus package is only two percent of GDP, which is not enough. Of course, an important difference between Iran and other countries is that Iran's economy, due to its long exposure to various sanctions, has fortunately had a high level of resistance to economic crises and people and businesses have learned to adapt quickly to new conditions.

What plans does the fund have this year given the need for a production leap?

First and foremost, we need to keep in mind that exports support the jump in production and counter sanctions in the post-Corona era. This means that one of the most important requirements for mutation production is to stimulate foreign demand and export development. Iran Export Guarantee Fund has provided credit facilities for buyers of goods and services from Iran. At present, due to the restrictions imposed by the export embargo, it has become difficult to cash in, and exporters have to pursue credit sales and some other payment methods, which of course carries their own risks, and the fund is ready to use the necessary tools to cover political risks. And use a business or design new tools for this purpose.

These risks are exacerbated, in particular, by the risks posed by the transfer of currency in the face of sanctions, and are in no way an obstacle to exports, as Iranian exporters are well aware of sanctions, but in order to gain market control and negotiate. They need to create a new advantage for themselves in order to find a new market. One of these advantages can be credit sales instead of cash, which of course will lead to risks of non-fulfillment of foreign buyer's obligations at maturity. In this regard, the Export Guarantee Fund is ready. Risks include political and trade risks And ensure the return of six for exporters to make demands.

At the same time, a special support package has been set up for the production jump this year, covering $ 2.3 billion in export risk, covering $ 700 million in export credit guarantees to expand exports to target countries with Eurasian priority, export risk risk. Technical and engineering services and the issuance of contract-based guarantees to secure exports with the priority of neighboring countries and to help import raw materials and machinery of export manufacturing companies are among the most important measures of the fund to achieve the goal of production jump this year.

* Afrooz Bahrami, Managing Director of Iran-Tasnim Export Guarantee Fund