Business & Economy

US sanctions force Iranian saffron industry to turn to smuggling

By Artemis Razmipour

Mashhad, Iran, Jan 20 (efe-epa).- United States sanctions against Iran are putting the country’s saffron industry at risk, leading to a rise in illegal smuggling of the so-called “red gold” into Afghanistan.

The obstacles the transportation system and bank transactions must overcome to move and finance exports of Iranian products, including saffron, are due to the US sanctions imposed on the Islamic republic in 2018 after Washington’s withdrawal from the Iran nuclear deal.

“The unilateral sanctions on the Iranian economy have had a very negative effect on the activity of producers and exporters in the agricultural sector due to limitations in foreign exchange transactions,” Ali Shariati the head of the Iranian Commerce Chamber’s Agriculture Commission.

Local currency devaluation has also played a role, as it has led Iranian authorities to apply restrictive regulations on foreign exchanges, a major detriment to exporters, some of whom have turned to smuggling to increase their income.

“The existing currency laws in the country have caused saffron to be smuggled into Afghanistan and exported from there,” he added.

Iran is the biggest saffron producer in the world.

Previously, the saffron bulb was smuggled into Afghanistan to be planted, but over the past couple of years the US sanctions have led to the illegal trade of “red gold”, according to Shariati, Chairman of the Board of Directors of the Saffron Export Development Fund.

A total of 50 tons of Iranian saffron were smuggled into Afghanistan between March 2019 and March 2020, Shariati said, describing the situation as a “serious threat” to the local market.

Although Iran’s around 500 tons of saffron a year account for over 90 percent of the global production, farms and producers do not make as much profit as they should.

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