Domestic Economy

Business Leader Questions Privatization Process

Business Leader Questions Privatization Process Business Leader Questions Privatization Process

A veteran businessman on Sunday praised the Rouhani administration for efforts it has made in the past year to promote non-oil exports and support the private sector but criticized authorities for what he called “improper implementation” of the privatization law.

“Efforts have been made, especially in less developed provinces, to promote non-oil exports,” said Gholam Hossein Shafei, the head of Iran’s Chamber of Commerce, Mines, Industries and Agriculture, in a meeting with local officials in the city of Yasouj, in Kohgiluyeh and Boyer-Ahmad province, IRNA reported.

“The government has taken significant measures to encourage the private sector,” he said citing low-interest rate loans to manufacturers as the most important one.

He added that the government’s economic policy along with its dynamic diplomacy has driven the privates sector out of “passivity and stagnancy.”

After years of passiveness, he said, delegations from the private sector have started to accompany President Hassan Rouhani in his overseas visits.

However, he criticized the “improper implementation of the Article 44” or the privatization law, noting that despite claims that the private sector has a large share of the economy, it only has a “20 percent share.”

In 2007, Iran’s Leader Ayatollah Seyed Ali Khamenei ordered the Ahmadinejad administration to speed up the privatization process. Nearly 80 percent of the state-run companies were subject to Article 44.

The previous government was planning to transfer the ownership of state-run entities to the private sector through the equity market and “Justice Shares” – a controversial scheme which was halted a year ago.

Shafei urged the incumbent government to keep supporting the manufacturing sector as a strategy that would lead to sustainable development. “The future of the economy is promising if the government and the private sector work in tandem.”

  Trade With Russia

Regarding a currency regime that seeks to replace the US dollar with the Russian ruble in Iran-Russia trade, Shafei said banking problems between the two countries must be solved first. “Central banks in both countries are trying to figure out possible ways to replace the dollar and euro with ruble.”

Citing Iranian Ambassador to Moscow Reza Sajadi, Fars news agency reported in 2012 that the currency proposal was first raised by former Russian president Dmitry Medvedev at a meeting with his Iranian counterpart, Mahmoud Ahmadinejad, in Astana, Kazakhstan.