The chief of staff of Iran's president has said in a letter that one billion euros ($1.12 billion) in hard currency allocated for importing medicines and essential goods “has disappeared”.

Mahmoud Vaezi, President Hassan Rouhani’s chief of staff in a letter to ministers of industry, agriculture and public health demanded an explanation about what has happened to the imports pledged by the recipients of the hard currency.

Since the steep devaluation of Iran’s currency in 2018, the government allocates cheap foreign currency to importers for a pre-approved list of essential goods, including medicines, food and crucial raw material. The importers are obligated to purchase and bring the approved goods into the country.

While on the free market one dollar buys 120,000 rials, the government provides the dollar for 42,000 rials - or three times cheaper - to approved importers of essential goods.

But there have been instances of abuse as individuals or companies receiving cheap foreign currency never import what they have agreed to, or once the goods arrive, sell them at much higher prices.

Sharq daily reported on July 20 that Vaezi in his letter mentioned about 849 million euros allocated for importing “essential goods” and 130 million for medications. In total he accused 20 companies of not bringing to the country what they had legally pledged to import.

The head of the presidential office has also sent the letter to the Central Bank of Iran demanding the legal pursuit of the case.

Just days earlier, the minister of health Saeed Namaki reported that a group of ministry employees were arrested for collusion in corruption conspiracies related to imports of medicines and medical equipment.

He disclosed that some importers had received two million euros to import heart stents but instead had imported electricity cables and fled the country.