Free trade agreement between EAEU and Iran to go into effect on May 15

MOSCOW. March 17 (Interfax) - The full free trade agreement between Eurasian Economic Union (EAEU) countries and Iran will go into effect on May 15, Eurasian Economic Commission Trade Minister Andrei Slepnev said.

The EEC trade bloc said in a statement that the commission had received official notification from Iran about the completion of domestic procedures necessary for the full-scale FTA agreement to go into effect. Iran was notified in January that procedures in the EAEU had been completed.

"According to the agreement, following the exchange of letters confirming the completion of the necessary procedures, a period of 60 days is envisaged for the document to take effect. Thus, the agreement will enter into force on May 15, 2025," Slepnev was quoted as saying.

The EEC expects the new agreement will be "an effective tool for developing trade between the countries and could lift mutual trade to a record $12 billion, approximately double current volumes, in the foreseeable future."

The EAEU, which includes Russia, Belarus, Kazakhstan, Kyrgyzstan and Armenia, signed the full free trade agreement with Iran in December 2023; the document underwent ratification by the relevant countries until the beginning of this year.

The full agreement is meant to replace a temporary one signed on May 17, 2018 and effective from October 27, 2019.

According to previous EEC estimates, the new agreement should enable EAEU-Iran trade to more than triple to $18-20 billion in five to seven years. Russian companies will gain preferential access to shipments of 90% of goods, covering 99.2% of current Russian exports to Iran.

The average duty rate for Russian suppliers will drop from 30% to 4.5%. At current export levels, this should save $380 million, Slepnev said earlier, citing EEC estimates. Russian Deputy Prime Minister Alexei Overchuk has estimated Russian businesses will save around $300 million on duties each year after the agreement goes into effect.