Economy, Business And Markets

Private Sector Seeks Removal of Trade Obstacles

Private Sector Seeks Removal of Trade ObstaclesPrivate Sector Seeks Removal of Trade Obstacles

Increased cooperation with the private sector has been high on the agenda of President Hassan Rouhani’s government ever since it came to power in 2013, in an attempt to lead the economy out of recession.

Last month, First Vice President Es’haq Jahangiri attended a meeting at Tehran Chamber of Commerce, Industries, Mines and Agriculture to identify the barriers to improving private sector participation in the economy, particularly after the sanctions imposed by the West over Iran’s nuclear energy program are lifted.

To this effect, he ordered the formation of joint committees between TCCIMA representatives and government organizations to help lift those barriers and pave the way for closer government-private sector interaction.

On Saturday, TCCIMA moved a step further and forwarded a letter to Jahangiri, proposing ways to improve the economic atmosphere and overcome obstacles to trade.

Implementing the law for continuous improvement of the business environment, reforms in the financial and taxation systems, improving government transparency, private sector’s participation in oil sales and organizing a joint government-private sector forum are some of the proposals made in the letter.

TCCIMA Chairman Masoud Khansari said the 36 clauses of the letter sum up the demands made by heads of various committees in TCCIMA. The requests are as follows:

1- Implementing clause 2 and 3 of the law for continuous improvement of the business environment. Both clauses emphasize on taking the private sector’s views in mind while drafting or modifying the regulations related with the business environment;  

2- Extending government support to domestic investors on par with foreign investors;

3- Promoting dialogue between the visiting foreign delegations and the private sector rather than with quasi-governmental organizations;

4- Supporting private sector’s activities in knowledge-based economy;

5- Encouraging foreign investors’ participation  in domestic production rather than just the domestic markets;

6- Allocation of funds from the National Development Fund to the tourism sector;

7- Reviewing the ineffective processes of privatization and transferring public enterprises to the genuine private sector;

8- Launching a national-level credit card operating system to encourage purchase of domestic goods;

9- Creating lines of credit for foreign buyers of domestic products;

10- Cancelling all illegal instructions on collecting export taxes and duties;

11- Increasing the capital of Export Development Bank of Iran and boosting the Export Guarantee Fund;

12- Lifting the ban on the use of National Development Fund’s facilities for export of technical and engineering services;

13- Collecting value added tax in various stages of production-distribution chain so that the burden is not imposed only on the manufacturer;

14- Supporting the role of private sector in the Supreme Council of Insurance, considering that 60% share of the Social Security Organization belongs to the private sector;

15- Compelling the Social Security Organization to respect the clauses of insurance law;

16- Facilitating the payment of government dues to private sector contractors through a joint meeting of representatives of the government, TCCIMA and contractors;

17- Organizing a joint government-private sector forum to facilitate coordination between relevant government agencies and economic players;

18- Correcting the “unfair clauses” in the general conditions of contracts, particularly in terms of contract termination;

19- Accelerating the process of facilitating the presence of international banks in the country;

20- Changing the government policy of purchasing private sector services in exchange for investment in infrastructure projects;

21- Transferring government enterprises purchased by the public and quasi-governmental organizations to the genuine private sector;

22- Setting and announcing plans for fighting corruption and publishing periodic reports in this regard;

23- Increasing government transparency and providing action plans in line with the 6th five-year development plan (2016-21) for downsizing the government and reducing current expenditure (salaries of public employees) in the fiscal budget;

24- Cancelling the resolutions adopted for the sanctions period as soon as possible;

25- Setting up electronic systems for customs authorities and other government agencies issuing certificates;

26- Announcing the prices of energy carriers and petrochemical feedstock for a period of no less than five years;

27-  Allowing private sector participation in oil swap projects;

28- Facilitating export of oil products by the private sector;

29- Refraining from raising import tariffs on agricultural products before assessing its impact on food processing industries;

30- Revising import tariffs and non-tariff barriers in the agricultural sector in line with the objectives of sustainable economic development and improving competitiveness for the export of processed food products;

31- Crop planning for the coming years with regard to the limited resources and cultivable land;

32- Announcing a clear government strategy for arriving at a unified foreign exchange rate (currently there are two rates: one set by the Central Bank of Iran and another, which is higher and decided by bureaux de change;

33-  Development of industrial insurance in the country;

34- Eliminating government intervention in production, distribution and price-setting for pharmaceuticals and relying on market mechanism of supply and demand for setting drug prices as well as transferring government-owned pharmacies to the private sector;

35- Immediate lifting of the requirement for labeling imported medicines for authenticity due to hidden corruption potential and ineffectiveness;

36- Avoiding price-setting for all commodities, except for a few monopolized and subsidized items.