Iran is steadily rising as a major player in the global footwear industry, currently ranked 11th among the world’s footwear producers. It holds the title of the largest producer and consumer of shoes in West Asia, with the potential to become a significant hub for raw materials and exports.
Despite modest foreign exchange earnings from footwear exports, which stand between $100-120 million annually, the industry’s strategic importance cannot be overlooked.
The footwear sector not only brings in crucial revenue but also plays a vital role in job creation. Approximately 500,000 people are directly or indirectly employed in the value chain that stretches across leather production, shoes, bags, accessories, and related industries.
Due to this, Iran’s footwear industry ranks fourth in the Employment Potential Index out of 71 job categories.
One of the unique aspects of Iran’s footwear industry is its classification as a home business. Producing shoes in homes or small workshops offers a cost-effective entrepreneurship model that benefits from state incentives like tax breaks.
This model provides local employment, especially in cultural and art centers such as mosques and industrial towns, contributing significantly to local economies and social security.
A notable example comes from Hidaj in northwestern Zanjan province, where many households, primarily led by women, are engaged in shoe production.
Graduates in the region have small household units where they manufacture shoes, highlighting the industry’s potential for grassroots employment.
Globally, the footwear industry remains heavily concentrated in Asia. Countries like India, China, Vietnam, and Indonesia dominate the market, with China alone accounting for more than 50% of all global footwear exports in 2023.
Iran currently produces about 270 million pairs of shoes annually, exporting 40-50 million pairs.
The country’s rich history in leather and footwear production dates back to the Medes in the seventh century BC. The modern industrialization of Iran’s footwear industry began in 1928 with the establishment of the first tannery and leather factory in Tabriz.
Today, there are about 10,000 footwear production units operating in Iran. Out of these, 230-240 are industrial, while the rest are small and medium-sized artisan businesses.
This diversity in production methods ensures that the industry remains flexible, catering to both large-scale exports and local demands.
While Iran’s exports reached $87 million in 2022, Turkey, a regional competitor, surpassed $1 billion in footwear sales during the same period.
The comparison also extends to value-added products. Iran’s export of petrochemical products, for instance, earned $592 per tonne, while footwear exports brought in $2,243 per tonne, emphasizing the higher revenue potential of value-added sectors like footwear.
One positive development is Iran’s focus on reducing its dependence on imported raw materials. Measures have been taken to complete the supply chain, significantly reducing the reliance on imports from 30% to less than 5%. This not only strengthens the industry but also enhances its export potential.
In conclusion, Iran’s footwear industry holds significant potential, not just within West Asia but globally. With a rich history, and a commitment to reducing import dependency, Iran is well-positioned to expand its role in global footwear markets.
This article is based on original reporting from PRESSTV
