According to the cultural correspondent of Tasnim News Agency, the major dependence of domestic industries on imports in Iran has caused the price of goods to be directly related to the exchange rate fluctuations, paper is one of the most important goods the price of which has increased in recent years due to the rising exchange rates.

This is true not only of imported paper, but also of domestically produced paper, as paper production in Iran is dependent on imports of raw materials. In the recent months, the price of foreign paper in the free market has risen and raised concerns about this market. Of course, all of the increase in its price is not related to the increase in the exchange rate.

In an interview with Tasnim News Agency , on how much domestic production depends on fluctuations in the foreign exchange market and whether domestic paper will increase inflation in the near future, Abolfazl Roghani Golpayegani, the Chairman of the Syndicate of Paper and Cardboard Manufacturers, he confirmed the impact of the increase in the price of currency on the paper market and said, “Of course, the main impact should be on newsprint and writing paper which are dependent on imported pulp, which we do not have the production of printing and writing paper in the current situation of Iran. This conversation is as follows:

* Tasnim: Mr. Roghani, the exchange rate of foreign currency market has affected all imported goods; how effective is the increase in the exchange rate in the field of domestic production paper?

The foreign currency has a unique role in increasing or decreasing the price of every commodity in the country, the energy depends directly on dollars, in a country where over 50 percent of revenues coming from exports, there is a heavy dependence on foreign currency, every change in the exchange rates impacts on all Institutions, one of the effects of exchange rate changes is the price of writing and newsprint paper that depend on imported pulp, and its price goes up and down with dollars.

As the exchange rate rises, so does the price of imported pulp; of course, it also impacts on other raw materials and various sectors of paper production. For example, it is not ineffective in chemical matters, but the share of chemicals in the cost of paper is not very large.

But can any exchange rate change affect our production?

Yes, it certainly does, it goes back to the depth of dependence on foreign raw materials and technicalities in the industry. For example, in the case of newsprint and writing paper, there is a serious dependence on pulp, which is not produced in Iran and must be imported; therefore, the effect of currency on the cost of paper can be seen quickly.

* Tasnim: Is the price of domestically produced paper also facing an increase in inflation now?

In response, I must say that there is no serious production of writing paper in Iran at all in the current situation due to the lack of government’s support in the past for writing and newsprint, it is no longer profitable for domestic factories to produce.

*Tasnim: It seems that now that imports are difficult and the currency is rising, it is time for domestic production.

Of course, today is the time to produce writing paper and newsprint. If domestic companies are looking for a good profit, they should be looking for the production of writing and newsprint paper. Today, the profit margin of this type of paper has improved, and now it is quite economical to enter this field.

Foreign currency price has risen sharply. The space is suitable for the domestic producer to grow, the logic of economics and production dictates that they move towards writing and newsprint paper production. It is true that the import of pulp is also affected by the price of currency, but in any case this price today is more economical, it helps both people and consumers.

* Tasnim: Does the syndicate have an executive guarantee to control the price of domestic paper? If so, are there plans to get controlled prices delivered to the consumer.

Frankly speaking, I personally oppose any price control. The pricing mechanism is not a good method, but uncontrolled approach is not good, either. Where can the government control? Where it gives something, it can also control the products. There should be a price control system here, and it should be control until the end of the distribution network.

The syndicates are NGOs. They are not in the position of enforcing regulations; unless the government wants to assign some of its powers to them. In the current situation, price control is the responsibility of the government itself, the government can delegate a part of its authority to people-centered entities and provide them with the necessary tools.

I am against pricing and price control

But in general, as the chairman of the syndicate and the chairman of the Industries Commission of the Chamber, I am against pricing unless the government provides support like USD at the exchange rate of 4,200 tomans; therefore, where the government gives subsidy, it is obliged to control the price.

*Tasnim: It seems that there have been obstacles to the imports of raw materials for paper production into the country. What have been these bans?

This issue is being solved, we have to support domestic production which is a principle, and if there is a suitable product, these imports should not be permitted, the country needs to import both in the paper sector and in the glossy paper, writing and newsprint paper sector. Sometimes a producer tells the government for whatever reason, I am self-sufficient, stop importing, but sometimes the government decides to hit the whole system without specialized suggestion.

For example, we do not yet have a very capable paint manufacturer producing chemicals and full color in our country. While everything is still not available; some manufacturers announce the government that they are self-sufficient and ask to prevent the imports of the product.

*Tasnim: What is the condition of the packaging paper? Evidence shows that we have reached self-sufficiency in this area?

We now produce packaging paper more than the country’s demand, now we produce from 200,000 to 300,000 tons more than the country’s needs which should be exported. For example,Mr.Rahmani made this decision, I told him, “Do you know what you have circulated? How did you say that the export of packaging paper should be stopped at the borders?” This decision was made while Mr. Rahmani himself was not aware of the circular he had signed. He did not know that penetrating into a foreign market is not an easy task. Staying in it is much harder and more complicated. Every time we built a market, it was stopped with some irrational instructions.

That is why our foreign customers do not trust us despite the serious restrictions we have on the supply of paper, we are good exporters, even to Europe, Asia, China, Korea, etc., but unfortunately the unstable decisions that in Areas of decision makers are taken cause the plans to be disrupted and trust in us to be lost.

Tasnim: What has been the status of packaging paper exports in recent months, given the corona situation?

In the last three months, the borders have just opened. Our borders between Iran and Azerbaijan and our neighboring countries have been opened randomly for 24 hours or closed for five days. There is no stability for any transaction.

Tasnim: In recent years, you have always been critical of government policies in the field of paper and criticized the lack of support needed to establish the paper industry. Are these policies still the same?

Paper is a very important industry, while it has an impact on culture and the economy, so it should be given more attention, but unfortunately our officials are emotional. There is a good capacity and opportunities in the country to invest in this type of paper (writing), but due to conflicting laws and lack of decisive and correct support, we go to imports and neglect the support of the private sector.

Every year for the past four years, the Supreme Leader of the Revolution has insisted that the situation of the production of writing paper be settled and that the authorities take care of it. In one of the previous years, the Parliamentary Cultural Commission focused on this issue, which was unfortunately later abandoned. At that time, Mr. Salek was the chairman of the commission, which formed a working group, and I was a member of it. When Mr. Salek left the Cultural Commission, the flow of paper was completely forgotten.

Unfortunately, despite the emphasis of the Supreme Leader of the Revolution, the issue of paper has been neglected. So the desire to import. If it is well organized and the issue of paper is seen as an underlying issue in the current cultural commission, its impact on culture and the economy will be evident. Working emotionally and repulsively for a while and then forgetting about it will not work. A working group should be formed in the parliament, the government and the judiciary to sort out the situation.