Friday, September 06, 2013

Iranian Trade With Latin America

I've written a lot about the overblown specter of Iran in Latin America, and here is another interesting note: trade with Venezuela remains low. Its three biggest trading partners are Brazil, Argentina, and Mexico (two of which the NSA is bugging the crap out of).

Thanks to a strong increase in trade with Mexico, that country now ranks as the third-largest Iranian trade partner in Latin America. It also ranks Iran's top market in Latin America. Mexico's Iran trade reached 133.8 million last year compared to only 9.97 million in 2011

That is not a part of the story you hear very often, since Iran's trade is supposedly a political ploy with leftist governments. Instead, you see the very economic reason Latin America likes Iran: it runs a big trade deficit, I assume soaking up commodities. If trade with Mexico grows, however, I would expect to hear assertions that it is all about hooking up with Drug Trafficking Organizations.


Adam S.,  4:29 AM  

That trade between Venezuela and Iran is still quite low shouldn’t be too surprising. The two countries’ main export is the same (crude oil) and they have to import a lot of the same stuff (like food and refined petroleum products).

I wonder if it might make more sense to evaluate the growth of the Venezuela-Iran “friendship” through the FDI data. I know that Iranian firms are building a lot of houses in Venezuela and do it pretty well. But much of the economic cooperation that’s been planned has been complicated by sanctions on the Iranian side (this has been the case with stuff like the car and tractor factories in Venezuela and the proposed Venezuela-Iran investment bank) and by a lack of money and/or seriousness on the Venezuelan side (this has been the case with most of the oil and gas projects I’ve heard about).

Of course, the concerns in the U.S. about growing Iranian influence in Latin America are almost %100 crazy.

Greg Weeks 9:09 AM  

I don't know if there is reliable FDI data, though. Would be interesting to dig around and see what the Venezuelan government publishes on it.

Adam S.,  1:55 PM  

I feel like I've seen a list with the announced value of all the projects on it somewhere, but it wouldn't be an accurate guide to the amount that was really invested.

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