Can Iran's Economy Be Saved by Closing Its Borders?

Radio Farda - Senior officials of the Islamic Republic are talking about launching a "movement to consume domestic goods." Mir Ali Hosseini asks economist Fereydoun Khavand why the old slogan "Buy Iranian, Buy Iranian Goods" has resurfaced these days? Fereydoun Khavand: Mobilizing public opinion to buy domestically produced goods instead of imported ones is an old technique that is used in almost all countries, even the most advanced ones, and has a long history in Iran. Another method is for the government to start with itself and avoid imports as much as possible for its own consumption. Last week, Ayatollah Khamenei asked the government to "forbid itself from consuming foreign goods." We know that the Iranian government has annual expenditures in the tens of billions of dollars, from purchasing equipment for state-owned industrial units to buying paper and pens for offices or vehicles for the police. The government cannot forbid itself from purchasing a significant portion of these goods, as Mr. Khamenei requested, simply because some equipment and raw materials are not produced in Iran and importing them is essential. In any case, the struggle to encourage the government and people to buy domestic goods is based on the old idea that closing the borders can revive the stagnant production and create jobs. Can closing the borders to imports allow the country to emerge from recession and solve the unemployment problem? Last year, Iran imported fifty-two billion dollars worth of goods through legal channels, and according to Islamic Republic sources, about twenty billion dollars worth of goods were also smuggled into the country. A multitude of foreign goods currently fills the Iranian market, from gravestones to flags and staffs used in mourning ceremonies, and some items presented to foreign tourists as local handicrafts in tourist cities. Apparently, 90% of the black chador consumed in Iran is supplied from abroad, equivalent to one hundred million dollars a year. The existence of so many foreign goods is not the cause of the recession and bankruptcy of Iran's production units, but rather a symptom of it. Foreign goods have conquered the country's market because domestic production has lost its defensive capabilities. How willing are people to buy domestic goods instead of foreign ones to help the country? Perhaps for a short period, say three to five years, people may be willing to make this sacrifice to support domestic industry. But if domestic goods do not improve, people will become disillusioned and seek foreign products. Just two days ago, the head of the National Association for the Protection of Iranian Consumers said that Iran Khodro and Saipa produce cars from thirty years ago, and people are tired of them.