The effects of the exchange rate increase on the sales of economic operators
Mohammad Hossein Adeeb
The increase in the exchange rate was more than the increase in the purchasing power of the people, and the result is a decrease in consumption. The decrease in consumption in the next phase has led to a decrease in active economic sales.
The author has 5 consultations per day and based on the experience of 150 consultations in the last 30 days, the average sales of economic operators is 40% of the year 2016.
The sale of essential goods and services in the following 7 areas has either remained unchanged or decreased by a maximum of 20%:
1 food
2. Treatment
3. Super needs of families
4. Maintenance services
5. Communications
6. Energy consumption
7⃣ Educational services
But the sale of non-essential goods and services, which includes the rest of the goods and services, has decreased by 70-80%, the average sale of essential and non-essential goods and services is 40% in 2016.
The economic cake has shrunk, with the increase in the exchange rate, Iran’s economy has shrunk
With the new exchange rate, the continued activity of 60% of economic operators has no economic justification
But who are the 60 percent whose continued activity has no economic justification?
Activists who did not have working capital and provided part of the capital in Gardes by borrowing from banks and the market are the first group that should leave the market.
But the exit of those who lack working capital from the market makes another business irrelevant, and those are banks and a group of wholesalers, the economic operator cannot add the financial cost or interest paid to the bank and the market to the price of the goods from the customer. to receive
These days, in 90% of cases, only those who do not intend to repay the loan take a loan
70% of bank loans are not paid with real estate collateral and the guarantee is only checks, promissory notes and contracts, which the bank cannot do much if the loan is not paid.
Regarding 5% of bank loans, by buying the bank’s appraisal agent, the price of the property is evaluated higher than its real value, and the loan amount is higher than the real value of the property, and there is no reason to pay the loan.
In the case of 15% of bank loans, the value of the property either exceeds the loan amount due to the long borrowing period from the bank, or is close to it, or the maximum value of the property is 20% less than the loan amount, which by the end of the year, the value The property is equal to the collateral, so the borrower has no incentive to pay the loan, in the case of 15% of the loans, the borrower tends to acquire the property bank in return for the demand.
Conclusion:
1. In the current conditions with the current dollar rate, the economic operator cannot add the cost due to the decline and interest of money to the price of goods and services.
2 ⃣Actually, receiving a loan has become uneconomical
3. Therefore, banks cannot pay interest to deposits, but they do
4. People have entered the economy based on non-existent profit and by receiving that profit from the bank, they buy houses and dollars.
5. And the price of the dollar and the house have been raised above the purchasing power of the poor and middle class
6. In the end, this game has no winner, everyone loses. This is speculation
A little patience
8. Iran’s economy has become hostage to speculators
@adibmh
This post is written by FaraDanesh1