Fuel smuggling, money laundering and destruction of industries
Dr. Mohammad Fazli
Four years ago, I was the director of a meeting about the state of the country’s textile industry to prepare a part of the report about the factors affecting the failure of this industry. The participants in the meeting told many points about the textile industry and its different dimensions, and among them, a narrative that provided evidence and documentation was very interesting.
One of the attendees asked, “Have you ever wondered how a tailored garment – for example, a Turkish suit – looks like on the street?” Is Tehran offered cheaper than its price in Istanbul?” And one of the members of the meeting explained one of the main mechanisms of this phenomenon in this way.
Imagine that 100,000 liters of gasoline are smuggled from Iran to Turkey at a price of 1,000 tomans per liter. The price of this fuel in the Turkish market is about eight to nine thousand tomans per liter, and at least each liter is worth five to six thousand tomans for smugglers. Every 100,000 liters of gasoline gives the smuggler 700 million tomans of money and between 500 and 600 million tomans of profit.
To transfer this money to Iran, the fuel smuggler converts it into textiles and clothes (he can certainly convert it into other goods as well). 700 million tomans of Turkish goods, even if they are sold in Iran at half the price, i.e. 350 million tomans, it means that the smuggler has converted the 100 million tomans cost of buying fuel in Iran to 350 million tomans and the Turkish goods at half the price. The same product has been sold in Turkey in Iran. This work is also money laundering.
This is part of the mechanism by which Iranian textiles and other goods lose their competitive power (and of course, not all of the troubles that befall Iranian industries and are not related to fuel smuggling). Fuel smuggling provides huge amounts of money to smugglers to launder money and destroy domestic industries through importing goods.
The lack of laws or the non-implementation of laws that track the origin of money, the high capacity to hide money traces, along with the relative price of fuel in Iran and its neighbors, a huge capacity to create such wealth and at the same time destroy domestic industries and cut the bread of the Iranian working people. has done
Imagine that the announced figure of 20 million liters of gasoline smuggling per day is correct and the profit of each liter of gasoline smuggling is only 4000 Tomans. This means daily 80 billion tomans profit from gasoline smuggling and equivalent to 29200 (twenty one thousand two hundred) billion tomans (equivalent to about 3 billion dollars) profit from gasoline smuggling per year. This figure is almost equivalent to the damage that is said to have been caused by the flood in the country. That is, with fuel smuggling, it floods us every year.
A part of this capital leaves the country completely and does not return, and another part enters the country in the form of money laundering and to destroy domestic industries, in the form of goods that are artificially cheap and made cheap by Iranian fuel.
Fuel smuggling is not only a waste of natural resources and capital of this country, but it goes far beyond that and is the driving force of a network of money laundering, imports, the destruction of domestic industries and the impoverishment of Iranian workers. Fuel smuggling is part of the fuel that drives the destruction of the Iranian economy, politics and society. A lot of money from it, if it enters any field, it creates corruption.
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This post is written by Hassangh44