Iran's Tile Factories on the Brink of Bankruptcy

The head of the Iranian Tile and Ceramics Union has announced that tile and ceramics factories in Iran are on the verge of "bankruptcy" and that the situation in this industry has not been "satisfactory" in the year 1394 (2015). Mustafa Goudarzi stated in an interview published on Wednesday, April 11, that tile and ceramics factories are experiencing a recession. He mentioned that "a number of tile factories are facing very unfavorable conditions due to a lack of liquidity and significant recession, and ultimately some have even approached bankruptcy and closure." He also spoke about the strikes by workers in these factories, noting that the warehouses of tile and ceramics factories have enough inventory to meet market demand for up to a year if production stops. Goudarzi attributed the main reason for the recession in the tile sector to the stagnation in the housing sector, stating, "As long as the housing sector does not emerge from its current recession, related sectors will also suffer from recession." He added, "When the Mehr Housing and the country's construction network were thriving, about 300 million square meters were consumed domestically, thus preventing any stockpiling." The head of the Tile and Ceramics Union had previously announced in the fall of last year that the current recession in this sector is unprecedented in the last 50 years, and tile producers are facing numerous challenges. In 1392 (2013), following the ongoing economic recession in Iran, it was announced that the "Saman Tile" factory, which employed 400 workers, had shut down. "Saman Tile" is noted as one of the largest tile and ceramics manufacturers in Iran, with its closure attributed to "lack of financial resources." In the last month of the previous year, Behnam Azizizadeh, the head of the Association of Tile and Ceramics Producers and Exporters, had requested in a letter for members of this association to shut down their factories for three months to manage production and inventory. Azizizadeh stated, "To manage and sell products that have remained in warehouses, factories need to be closed for a while to equalize production with demand." In recent years, numerous reports have emerged regarding the closure of many production units and the unemployment of thousands of workers in Iran, with sanctions, imports, and economic recession identified as the three main factors behind these events.