Tehran, Kuwait could raise trade to $1b per annum: Senior businessman
The vice president of the Iran-Kuwait Joint Chamber of Commerce highlighted the positive prospect of economic relations between the two countries, noting that bilateral trade could annually reach $1 billion.
In an interview with Iran Daily, Arash Nikpey stated that Iran and Kuwait boast significant potential to expand economic and trade cooperation.
“By leveraging these opportunities and addressing existing trade challenges, bilateral exchanges can rise and achieve substantial growth,” he said.
Nikpey noted that Iran’s highest export volume to Kuwait occurred in 2018, when exports reached $350 million. However, since then, trade volumes have declined, stabilizing at around $200 million annually for the past two to three years.
Historically, Iran and Kuwait have maintained strong trade and cultural ties, he added, noting that given Kuwait’s significant Shia population, the two nations share cultural proximity, which has also fostered robust religious tourism links.
Nikpey pointed out that relations improved during the Iraqi invasion of Kuwait in 1990, as Iran sided with Kuwait in the conflict. Nevertheless, Kuwait’s cautious diplomatic stance among Persian Gulf Arab states has sometimes hindered closer ties.
The trader also acknowledged that recent political and economic challenges, including sanctions on Iran, negatively impacted regional relations. “However, under the administration of the late Iranian president Ebrahim Raisi, ties began to recover. For instance, Kuwait appointed an ambassador to Tehran after a seven-year hiatus, signaling a shift toward better relations.”
Nikpey called for the resumption of the Iran-Kuwait Joint Economic Commission, which has not convened in years. “Reviving this commission could pave the way for a shared economic vision and provide a roadmap for strategic cooperation,” he said.
Addressing visa issuance challenges for Iranian citizens, Nikpey emphasized that resolving these issues would significantly enhance trade and economic exchanges, making the $1 billion trade target achievable.
Kuwait’s reliance on imports for most of its food and industrial needs makes it an attractive market for Iranian exporters. “Nearly all goods have export potential to Kuwait,” Nikpey explained. However, he noted that Kuwait’s high purchasing power and stringent product standards require exporters to meet quality expectations.
Iranian food products have historically been popular in Kuwait due to shared tastes, and demand for Iranian construction materials has also grown in recent years, the trader explained.
Nikpey urged Iranian exporters to focus on effective marketing strategies to have greater presence in Kuwait’s industrial product market. However, high transportation costs remain a barrier.
“Iran’s transport fleet primarily serves routes to the UAE and Oman, with less heading toward Kuwait, driving up shipping expenses,” he said.
Despite logistical hurdles, Iran has access to Kuwait via Iraq’s Basra, Abdeli, and Safwan borders, the trader said, noting that the lack of operational connections, partly due to Iraq’s incomplete implementation of the TIR Convention—a global customs transit system—has limited progress.
Nikpey concluded by suggesting that a joint meeting among transportation officials from Iran, Iraq, and Kuwait could help open trade routes, reducing costs and boosting economic ties.