Drop in carpet prices depletes Iran's coffers
Iran's economic troubles have been compounded by a drop in Oriental rug prices. Persian carpet prices, says John Gregorian, a carpet dealer in a Boston suburb, have dropped 10 to 15 percent since their peak in January 1980, shortly after the Iranian revolution. Many buyers figured the revolution would clobber carpet production and regarded Oriental rugs as an investment as well as beautiful floor coverings.Skip to next paragraph
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One factor in the price drop was the 1982-83 recession in the United States. It depressed sales of all ``collectibles.'' Another has been tougher competition from Pakistani, Turkish, Indian, and Chinese carpets.
To combat the price decline, Iran has set a price floor for its carpets. But Mr. Gregorian says that a controlled special exchange rate for the Iranian riyal can result in realistic prices.
Smuggling of carpets across the Persian Gulf to the sheikhdoms along the Arabian Peninsula has increased, a United States government source says. Some Iranians find this a convenient way to obtain foreign exchange they would otherwise be denied by the authorities.
Last year Americans imported $22 million of Persian carpets, up from $17 million in 1983.