Deployment against domestic production; Paper industry is crippled in the tariff arena

According to Mehr News Agency, paper industry in Iran has suffered from a fatal disease for which no treatment appears to have taken, and it has led to different aspects. Indiscriminate imports, low tariffs on imports, and other problems that have plagued the entire industries of the country have imposed a great loss on paper industry, and the production of all kinds of paper industries is facing problem. 

Instead of supporting production which should be at the helm of government measures, the importers have been able to import with low tariffs for recent years. On the other hand, manufacturers are obliged to pay 9% VAT on their production. Both of these policies have caused manufacturers to fail in the competition with importers.

Importing Chinese paper with lower price than the cost price of domestic producers is another problem which has made paper manufacturers complain; they say the Chinese paper is imported to the country and sold under an Iranian brand with higher prices.

Accordingly, the incorrect policy to control the paper market has caused to replace the imported products with domestic production and the manufacturers' products to be stocked at factory warehouses. In this respect, manufacturers believe that the government is unable to control the market and thinks the solution for controlling the market is to import.

 

Unequal competition between the producers and importers in paper section

In this regard, in an interview with Mehr News Agency Abolfazl Roghani stated that the government has made the manufacturers compete with importers in unequal conditions and added, "The paper industry is among those industries which have incurred immense damages for recent years."

Stating that a part of the problems is related to imports, he added, "A part of the paper consumption is supplied by imports, and the government and the current rules and regulations have facilitated the conditions for importers and made them difficult for manufacturers."

The advisor to the head of the Iran's Chamber of Commerce pointed out that 9% Vat is not paid for the imported writing paper while domestic producers pay it which means the manufacturers pay tax around 12% more than importers and continued, "Another problem of paper industry is the creation of production capacity more than the requirements."

Stating that in packaging the domestic requirement is 800 thousand tons while 2million and 800 thousand tons of production capacity has been created, Roghani said, "Therefore, there is 2 million of tons capacity more than the domestic requirements which should be exported, but the exporting sections have acted weakly, and we do not have suitable relationship on the market of peripheral countries." 

He considered political issues one of the problems of paper industry and stated, "Paper is the captive of political policies and the government fear and anxieties, while we need the change of tariffs for the management of paper production. However, the government is acting cautiously about changing tariffs." 

Referring to paper as a strategic product which makes problems if it is not supplies for newspaper, the member of the board of Iran's Chamber of Representatives said, "The government is concerned about it, and the media power does not allow the cabinet to manage the issues correctly." 

The head of the Industrial Commission of the Chamber of Commerce, Industries, and Mines continues, "Unfortunately, some imagine that paper can be cashed easily while it is not true. However, this imagination has caused some to sell their products on the international markets in return of paper."

Roghani announced that they bring the paper into the country and sell it less than the market prices and added, "These people sell the cheap exported goods  in the countries such as China and make high profit, but since they cannot transfer the money to our country, they buy paper and imported it to the country instead." 

He, referring to the fact that importers so not care about what will happen on the market while this process destroys the market, said, "Paper has certain standards and conditions, but when it is imported at a lower price to the country, the market will be disrupted, and the prices will be affected."