Turkish-Iranian Trade Disappoints Big Time

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By Mehmet Cetingulec for Al Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iran Business News.

Turkey and Iran have maintained cooperation in regional affairs in recent years, including most notably joint efforts for a settlement in Syria but also solidarity against US and Israeli policies in the Middle East. Earlier this month, Turkey’s interior minister even raised the prospect of a joint operation against Kurdish militants.

The political solidarity has been widely expected to strengthen bilateral trade, with a number of steps taken to that effect. In 2015, a preferential trade agreement between the two neighbors lowered tariffs on 125 industrial and 142 agricultural products. Two years later, a swap agreement took effect to allow the use of national currencies in bilateral trade.

When introducing the preferential trade agreement, the two countries had set a target to boost the volume of bilateral trade to $35 billion. Four years on, the result is a disappointment in full measure. In 2018, bilateral trade was worth $9.3 billion, the lowest level over the past nine years.

SOurce:http://www.iran-bn.com/2019/03/23/turkish-iranian-trade-disappoints-big-time/

Iran’s Non-Oil Exports Hit $40bn in 11 Mths

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The head of Iran’s Trade Promotion Organization (TPO) announced that the country’s non-oil exports over the first 11 months of the current Iranian year (March 21, 2018 – March 20, 2019) have reached 40 billion dollars.

Speaking to the Islamic Republic of Iran Broadcasting (IRIB) on Thursday night, Mohammad Reza Moudoudi said the non-oil exports of the country in the first 11 months of the current year reached $40 billion, which showed a 0.75 percent decrease compared to the same period last year.

However, he said, the value of non-oil exports in the first 10 months of this year has witnessed an increase compared to a year earlier.

The official went on to say that the main reason for the decrease of our non-oil exports over the past 11 months was the restrictions on the sales of gas condensate, whose exports dropped by about 37.5% compared to a year earlier.

Iran has stepped up efforts in recent years to enhance its non-oil exports and reduce dependency on its oil revenues. The rise in the country’s exports comes despite the US sanctions.

US President Donald Trump walked away from the 2015 nuclear deal between Iran and world powers in May and re-imposed sanctions on the Islamic Republic.

Following the US exit from the nuclear deal, Iran and the remaining parties launched talks to save the accord.

Trump on August 6 signed an executive order re-imposing many sanctions on Iran, three months after pulling out of the Iran nuclear deal.

He said the US policy is to levy “maximum economic pressure” on the country.

The second batch of US sanctions against the Islamic Republic took effect on November 4.

Source:http://www.iran-bn.com/2019/03/25/irans-non-oil-exports-hit-40bn-in-11-mths/

Iran sitting on 200 Undeveloped Oil/Gas Reservoirs

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There are currently over 200 undeveloped oil and gas reservoirs in Iran, an official has said.

According to the National Iranian Oil Company (NIOC), Director of NIOC’s Integrated Planning Karim Zobeidi said that a total of 42.4% of Iran’s oil reservoirs and 10% of the gas reservoirs have been depleted so far.

Speaking on Monday at Amir Kabir University of Technology, the official said that there were 125 oilfields and 59 gas fields in the country, adding there are now more than 200 undeveloped reservoirs in Iran.

He stated that Iran’s oil and gas reservoirs and fields have a high capacity for research studies.

“Currently, most of Iran’s oil production is from the Asmari and Bangestan reservoirs of Ahvaz Oilfield, which has 70 billion barrels of oil in place,” he said.

Zobeidi added that Gachsaran, Rag Sefid, Bibi Hakimeh, Parsi and Aghajari fields are other major oil fields in Iran, and said: “It should be noted that high production requires continuous investment and exploitation of the latest technologies; in this regard, it is necessary to promote efficiency of activities by conducting research activities.”

He stated that currently the average production rate of hydrocarbon fields in the world was nearly 35 percent, almost 10 percent higher than that in Iran.

Source:http://www.iran-bn.com/2019/03/26/iran-sitting-on-200-undeveloped-oil-gas-reservoirs/

Iran Launches New Phases of South Pars Gas Field

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Iran’s president inaugurated four new phases of the large South Pars gas field in the southern province of Bushehr on Sunday.

Accompanied by the minister of oil and other top officials, President Hassan Rouhani inaugurated the phases 13, 22, 23 and 24 of the South Pars gas field.

Each of the new phases has a daily capacity of producing 56 million cubic meters of natural gas.

In these four phases, 77,000 barrels of gas condensate and 400 tons of sulfur are produced on a daily basis, and 1.5 million tons of liquid gas and one million tons of ethane are also produced per year, officials say.

The opening of new gas refinery complexes in the four phases has raised Iran’s gas refinement capacity in the South Pars gas field to 700 million cubic meters a day.

Iran’s capacity for daily gas extraction from the joint gas field has now reached 660 million cubic meters.

South Pars, whose development has been divided into 28 phases, is located in the Persian Gulf straddling the maritime border between Iran and Qatar.

It covers an area of 9,700 square kilometers, of which 3,700 square kilometers belongs to Iran.

It is estimated that the Iranian section of the field contains 14 trillion cubic meters of gas and 18 billion barrels of condensates in place.

Source;http://www.iran-bn.com/2019/03/27/iran-launches-new-phases-of-south-pars-gas-field/

South Pars Gas Output to Hit 750 mcm by Late 2019

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Iranian Minister of Petroleum Bijan Zangeneh said the country’s gas production capacity from the supergiant South Pars gas field would cross 750 million cubic meters per day by late 2019.

Addressing a ceremony to officially launch phases 13 and 22-24 of the major joint gas field, that was held in the presence of the Iranian President Hassan Rouhani in the southern city of Assaluyeh on Sunday, Mr. Zangeneh said the first South Pars development contract was struck back in 1997, and until August 2005, only 5 phases of the field were completed.

Between 2005 and 2013, the 5 unfinished phases were completed, he added, saying that in the period from 2013 to 2018, Phase 12 came online in 2014, phases 15 and 16 were completed by 2015, in early 2017, 6 phases became productive and today 4 other phase have come on-stream. “This brings the total number of South Pars refineries which became operational during the period to 15.”

He said plans were under way to bring online three more South Pars phases by mid-2019 which would include phases 13, 14 and 22-24.

The official further added that Iran’s gas production capacity stood at 622 mcm/d back in 2013 which is currently at 841 mcm/d and was expected to reach 880 mcm/d next calendar year (which begins on March 21) and 950 mcm/d by 2020.

The Iranian Minister of Petroleum added that gas production from South Pars stood at an average of 610 mcm/d while production capacity was 660 mcm/d from the joint gas fields.

Source:http://www.iran-bn.com/2019/03/28/south-pars-gas-output-to-hit-750-mcm-by-late-2019/

74pc export through pvt banks in 2018

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Private commercial banks are dominating the country’s international trade as around 74 percent export in 2018 took place through them.

On the other hand, only 7 percent export was done through the state-owned banks and the remaining 19 percent through foreign commercial banks, according to a study of Bangladesh Institute of Bank Management (BIBM).

In 2011, the study report said, 71 percent export was through the private commercial banks while 18 percent through the state-owned commercial banks and the rest through foreign commercial banks.

The research report was presentedyesterday at a daylong review workshop at the BIBM in the city, said a press release.

The workshop was organized simultaneously at BIBM auditorium in Dhaka and Bangladesh Bank (BB) Sylhet office (through video conferencing).

BIBM Executive Committee Chairman and BB Deputy Governor SM Moniruzzaman was present at the workshop as the chief guest while Executive Director of the central bank Sylhet Office Syed Tariquzzaman, former Dhaka University Professor Barkat-e-Khuda and BIBM supernumerary professors Md Yasin Ali and Helal Ahmed Chowdhury spoke, among others, at the workshop.

BB Executive Director and BIBM Director General M Abdur Rahim chaired the program.

BIBM Professor and Director (Training) Dr Shah M Ahsan Habib presented the research paper titled “Trade Services Operations of Banks”.

The study identified the problem areas as well as success factors in trade services and operations of banks in Bangladesh.

Considering the concerning issues of trade based money laundering, compliance requirements, and other financial crimes, SM Moniruzzaman said, BB has strengthened requirements to enhance the trade quality.

“Our policies are now developing according to market needs and risks. The ‘New Guideline for Foreign Exchange Transaction’ has already been published,” he added.

He said integration between supervisors and the schedule bankers made the policies more operationally effective.

With this view, he said, Foreign Exchange Policy Department (FEPD) has established an AD forum with the trade heads in the scheduled banks.

Moreover, enforcement of online reporting and monitoring system by the Bangladesh Bank has brought positive changes in terms of decline in irregularities by banks and improvement in data accuracy, he added.

Senior bank executives, academicians, media representatives, faculty members, officers of BIBM participated in the review workshop.

source:http://www.dailyindustry.news/74pc-export-pvt-banks-2018/

Bangladesh need infrastructure to attain $5b export earnings from ICT

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Bangladesh earned $182 million from ICT exports in 2018 which was $193.93 million in 2017. Computer service exports from Bangladesh fell by 6.16 percent, according to data from the Export Promotion Bureau (EPB).

The government has targeted $5 billion in annual export earnings from the ICT sector by 2021. However, ICT industry insiders say they disagree with the EPB data, claiming it does not reflect overall earnings from the ICT sector and there are faults in the system of calculation.

Computer services include software, data processing, consultancy, computer maintenance, and installation.
Sources said the real picture of export earnings from computer services were not reflected in the EPB data due to the lack of a proper mechanism for data collection.

The lack of a central authority to shoulder the responsibility of collecting data on computer service exports also contributes to the inaccuracy of the data, they added.

Bangladesh Association for Software and Information Services (BASIS) President, Syed Almas Kabir, said all earnings from computer service exports are not coming through banking channels, and hence some payments are not considered to be part of export earnings.

“A portion of our export earnings are being treated as remittance, as they come through digital payment services such as Upay. We need a proper mechanism to calculate earnings which takes these payments into account,” he said. Telecommunications and Information Technology (ICT) Minister, Mustafa Jabbar, echoed the BASIS president in saying that the EPB and the Bangladesh Bureau of Statistics (BBS) can’t reflect the true picture of ICT sector earnings.
“Making a comment on our export earnings based on EPB and BBS data would not be right,” he added.

According to the Bangladesh Association of Call Center and Outsourcing (BACCO), the call centre and outsourcing industry alone earns about $300 million a year.
BACCO President Wahidur Rahman Sharif said: “If we consider the overall earnings of the ICT sector, it is over $700 million.”

BACCO President Wahidur Rahman Sharif, also managing director of Digicon Technologies Ltd, said a lack of infrastructure and skilled manpower were the main challenges to the ICT sector.

“Right now, the main challenge for the ICT sector of Bangladesh is a lack of proper infrastructure. The quality and reliability of internet connections in the country is questionable,” he said.
He added that there was a lack of skilled manpower, as the country’s education system is not geared up towards the ICT industry.

“Bangladesh also lacks branding to inform global buyers of the quality and capacity of the Bangladeshi ICT industry. As a result, foreign companies are not interested in outsourcing work here,” said Wahidur.
In order to gain a larger share of the global ICT services market, Bangladesh needs to provide policy support and branding, BASIS President Syed Almas Kabir said.

He added that the collection of accurate data was essential for setting a strategy for the sector’s expansion.
“To establish a proper database for the sector, BASIS will launch a research project to collect data on people who are engaged in the ICT sector, the size of local markets, and export earnings,” the BASIS president said.
Regarding the need for branding, Syed Almas said: “Currently, Bangladesh is branded as a marketplace for cheap labour. This gives the wrong impression. We have to show that we are capable and can provide quality.”

Furthermore, Bangladesh has to concentrate on developing valued services, such as mobile games and apps, he added.
Meanwhile, industry insiders said the government needs to provide high speed internet and uninterrupted electricity for the ICT sector at an affordable rate, in order to meet the target of generating $5 billion in annual export earnings from the sector by 2021.

However, huge challenges lie ahead, and the next few years will be very crucial as the industry needs to adapt to technological changes, they said.

“We have enormous opportunities in the field of digitisation, but we don’t have enough skilled human resources to meet the needs of the information and communications technology industry”, BASIS president said.
Now, 120 Bangladeshi companies are exporting ICT products worth $750-$800 million to 35 countries, industry insiders said.

Source:http://www.dailyindustry.news/bangladesh-need-infrastructure-attain-5b-export-earnings-ict/

Palak for utilizing prospects of fourth industrial revolution

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Staff Correspondent: State Minister for ICT Zunaid Ahmed Palak yesterday called upon the private sector to cooperate the government for finding out a solution to meet the possible challenges as well as utilize the prospects of the fourth industrial revolution.

“A solution will come, if the government and private sector hold joint discussions to overcome the fourth industrial challenges,” he told the inaugural ceremony of a 3-day BASIS Softexpo 2019 at International Conference City Bashundhara (ICCB). Palak said the previous first, second and third industrial revolutions created a lot of opportunities and generated employment although there was apprehension of huge job loss.

“The fourth industrial revolution can be boon for us if we utilize the prospects and opportunities because of the emergence of new technologies,” he said.

The state minister said the educational institutions including universities have to take step to change their curriculum to develop skills on emerging technologies. Palak said the government has already taken initiative to set up Sheikh Hasina Institute for Frontier Technology (SHIFT) on 70 acres of land in Shariatpur to create skill manpower on new and emerging technologies.

The government has also taken a project titled: ‘Establishing Digital Connectivity (EDC)’ to reach internet facilitates in each village within the next five years, he said.

Bangladesh Association of Software and Information Services (BASIS)
organized the expo in partnership with ICT Division.

Executive Director of Bangladesh Computer Council Parthapratim Deb,
President of BASIS Syed Almas Kabir and Senior Vice President Farhana A
Rahman, among others, addressed the function.

Leveraging ICT for Growth, Employment and Governance (LICT) Project and
Bangladesh Computer Council (BCC) are zone partners of industry 4.0 Zone and
Experience of Zone.

The BASIS Softexpo started with the slogan of `Technology for Prosperity’.
More than 250 national and international IT companies are showcasing their
products and services in this mega exhibition of Bangladesh. More than 100
local and international experts will address 30 seminars on various
contemporary IT related issues.

source:http://www.dailyindustry.news/palak-utilizing-prospects-fourth-industrial-revolution/

Manpower export falls 24pc in last 7-month

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Zahid Hossain Biplob: Labor migration has become an important factor for Bangladesh in respect of employment generation, GDP growth, poverty reduction but in recent years the country is facing severe crisis for manpower export.
Industry insiders said, most manpower-importing countries are interested more in employing skilled workers. The authorities should take pragmatic steps to create a sizeable manpower, properly trained in trades that are in high demand in those countries. Most of the Bangladeshis on jobs abroad are poor and uneducated. There are heavily underpaid and face deprivation by overseas employers very often.

In order to stop the falling trend of manpower export, it is necessary to launch vigorous diplomatic drive to persuade the traditional manpower importing countries to open their doors for the Bangladeshi workers. The Bangladesh missions abroad need to be restructured with a view to effectively dealing with the emerging situation.
Although the matter of taking various initiatives was heard, new labour market is not really being opened to Bangladeshi workers. Some 109,607 Bangladeshi male and 21,458 female went to different destinations in January and February this year. Remittance inflow was $1090.82 million and $1386.61 million in January and February respectively, according to official figure of the Bureau of Manpower, Employment and Training (BMET).
Bangladesh’s overseas employment, according to an official estimate, dropped by more than 24 percent in the first nine months of the current year, compared to that of the corresponding period of previous year. The main destination point of the migrant workers has so far been the Middle East.
But the Gulf nations, mainly Saudi Arabia, are not hiring workers from Bangladesh on a large scale, creating negative impact on overall overseas job scenario in the sector.
Slow development work and restrictions on certain jobs for foreign workers were the main causes behind major fall in manpower export to the Kingdom. Falling oil price, political uncertainty and slow development work are also making it difficult for foreign workers to get jobs.
On the other hand, Malaysia has also suspended manpower recruitment from Bangladesh through the existing system under ‘G2G Plus’ deal due to some alleged unethical practices of the recruiting agencies. The south-east Asian country is now working to launch a new system for hiring manpower. As such, until introduction of the process, labour migration to the country will remain held-up.
Experts said, Bangladesh should try to tap other markets like rich nations in Africa and other oil-enriched Gulf countries like Qatar, Kuwait and the UAE to narrow the gap. In the past, workers could manage to get jobs, but now-a-days, it is difficult due to economic slowdown in most of the Middle Eastern countries. Although the migration cost is still much higher in Bangladesh comparing to the competitors.
The doors of developed countries, including America, Russia, Japan, South Korea and Australia, and some European countries are still closed for the Bangladeshi workers.
In current month, the destination of 90 percent of 1.0 million workers went abroad was the old market like Middle East, Malaysia and Singapore. But the Middle East crisis has been prolonged due to new rules of Saudi Arabia, visa closure of the United Arab Emirates and instability of Libya.
Only sending workers through the Malaysia’s government-to-government plus system has created hope. But introducing the new system of giving Immigration Clearing Certificate (ICC) by setting up an office in Dhaka for sending workers to Malaysia has created fresh complexity in sending Bangladeshi workers abroad.
It was learnt that Bangladesh’s biggest labour market in Saudi Arabia. One of the world’s richest and most oil-producing countries has approved a master plan named ‘Vision-2030’ in its cabinet in April 2016 in order to reduce its oil-dependency in economic matters and improving economy of the country.
The master plan says for coming out from the oil-dependent economy, creating new sectors of employment for young generation in the technology sector and empowering women.
As a part of implementation of the ‘Vision 2030’, the labour ministry of Saudi Arabia imposed a ban on many shops, including mobile, burka, rent-a-car, accounting, women’s ready-made garments, glasses, watches, home appliances, car parts, vehicle showrooms, electrical appliances and electricity materials, hospital equipment, chocolate or sweets, readymade garment, crockery, carpets, furniture or decoration, shopping mall, girls’ school and running heavy vehicles and crane.
They imposed the ban on the increase in the employment for the Saudi citizens at different sectors in the country.
Apart from this, the Saudi government also issued order to appoint the country’s citizens to the top posts of different institutions.
As a result, Bangladeshi expatriates involved in the ‘white colour’ professions of accountants, salespersons, administrators, sales-managers, sales supervisors, finance managers, chief accountants, senior accountants, office-bearers, drivers, receptionists, warehouse managers, lift operators, logistics supervisors are also losing their jobs.
It fears that the labour market in Saudi Arabia will be minimised due to such a decision of the country’s government while the Bangladeshi expatriates are in deep tension.
Bangladeshi workers were in panic after 26 workers were sent back from Singapore on charges of their involvement in militancy.
It was learned that Singapore is taking workers from India and other countries instead of Bangladeshi workers in construction and shipping industry.
Now, the dependency is only on Malaysian labour market in this worse situation. Two government agreements have to be continued in the country. But there are also a number of obstacles.
Bangladesh Association of International Recruiting Agencies (BAIRA) secretary general Ruhul Amin said, “Over 200,000 demand letters came from Malaysia. Of them, 112,000 workers have already flown to the country. Some 60,000 workers are now waiting to go to Malaysia. Hopefully, it will be possible to send 300,000 workers every year to the country.
Many said a foreign company started the process of issuing an immigration clearance certificate (ICS) by opening a new office in Dhaka for sending workers to Malaysia. Before the start of medical tests and other formalities of the workers, they are taking Tk 3045 in the name of immigration clearance.
When the government is trying to reduce the expense of the immigration, it has raised the question about taking money by the unauthorised organisation.
However, ICS officials claimed that they introduced the method as per the negotiations of both countries.

Source:http://www.dailyindustry.news/manpower-export-falls-24pc-last-7-month/

DIY retailers struggle in sputtering economy

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SA’s DIY retail stores have mostly been immune to economic downturns.

When the going was good, people bought new homes, which they renovated later. In a sputtering economy, many prefer fixing things themselves.

Thanks to this kind of all-weather resilience, companies like Cashbuild and Italtile became JSE favourites.

But now, even they say this slowdown is the severest in a long time. Over the past year, retailers have had a lot to grumble about, as a rise in the VAT rate, increases in the fuel price and poor wage growth have drained consumers’ wallets.

The difficulty was evident in total retail sales growing only 1% for the three months to end-December. For hardware, paint and glass retailers, sales shrank 1.5% for the period, Stats SA data shows.

This could clearly be seen in the performance of Massmart’s Massbuild division, which had a rise in sales of 5.9% to R13.72bn but only a paltry 1.8% gain to R749.1m in trading profit in its results for the year to December.

At rival Cashbuild, revenue inched up 3% to R5.56bn and operating profit declined 12% to R284m for the half-year to December.

The situation is unlikely to change soon. The wider view is that consumer confidence will only really improve when the government sets out its economic strategy after the May 8 elections.

It’s not been totally bad for everyone, though. Spar’s Build it chain increased sales 10.3% for the 17 weeks to January 26.

Italtile is not waiting for the elections to see what happens. CEO Jan Potgieter says the group is employing various strategies to cope with the difficult economy. It plans to take more market share from its competitors.

Potgieter says that in an economy that’s slowing down, one of the ways the company can grow is by getting customers to buy all the material they need to renovate their home from one of its stores.

At its low-income-focused chain TopT, for example, people can buy an extensive range of products, obviating the need to go anywhere else.

Potgieter says the diversification of its product range has led to tile sales now making up only 50% of total sales. Italtile’s retail turnover rose 7% to R3.33bn and net profit 13% to R189m for the six months to end-December.

Despite the growth, Potgieter says middle-class customers are clearly taking strain.

Massbuild CEO Llewellyn Walters says the chain adapted to the slowdown by supplying materials to enterprises, larger landlords and building sites.

Essentially its strategy boils down to “looking for sectors unaffected by the recession”.

Massbuild has also been quick to adapt to the specific regional needs of consumers. During the drought in the Western Cape it bypassed its distribution centres and delivered JoJo rainwater tanks directly from the factory in Groblersdal in Limpopo to two of its stores in Cape Town.

Though the economy remains sluggish, Potgieter sees “huge” potential in the SA tile market. When compared to other middle-income countries, SA’s tile market is only about half the size.

“People want to invest in their homes. It’s usually their most expensive asset.”

At a share price of R13.50 and a p:e of 13.02, Italtile looks nicely priced and seems worth buying, but not everyone is sold on it, or the other DIY chains. “Italtile has good metrics, but we are avoiding the DIY sector,” says AlphaWealth fund manager Keith McLachlan.

He says that with credit extension on the decline, consumers are holding off on upgrading their homes.

This, along with increased competition, means DIY retailers are going to be under pressure for some time.

The sector’s prospects are changing at a “fundamental level”, McLachlan says. “The golden age of DIY retailers is more or less over.”

Source:https://www.businesslive.co.za/fm/money-and-investing/2019-03-07-diy-retailers-struggle-in-sputtering-economy/