Economy, Business And Markets

Banker Advocates Floating Forex Rates

Banker Advocates Floating Forex Rates  Banker Advocates Floating Forex Rates

Unification of foreign exchange rates is now viable and official exchange rates are now closer to the free market prices, CEO of Parsian Bank, Kurosh Parvizian said, the Trade Promotion Organization of Iran’s website reported Wednesday.

Parvizian stated that interventions in the past by governments in the critical foreign exchange market had created many problems for exporters. “If exchange rates had been allowed to rise reasonably according to market mechanisms, exporters would have benefited.”

The analyst also touched upon privatization saying that Article 44 of the Islamic Republic of Iran Constitution had taken a good approach toward the issue but criticized the methods and mechanisms used in the arduous privatization path, which he said had given rise to renewed speculation that the process “is heavily influenced by vested interests.”

Prominent and respected economists over the years have been quoted as saying that the privatization program is not what it should have been and that “quasi-government organizations” had in effect taken over big state and government-owned companies under the guise of privatization.

Parvizain who presides over Iran’s Association of Private Banks& Credit Institutions also drew attention to the international sanctions and the harm they did to the country’s imports and exports for more than a decade.

“During the period of sanctions the country’s goods distribution network, transportation and monetary transactions with the outside world faced many challenges.

Iranian traders were cut off from global markets that earlier enabled them to import raw material, goods and machinery. Exports also suffered to a great extent,” he noted.

The senior banker, however, expressed the hope that conditions would change for the better in the not too distant future and after the economic, banking and oil sanctions are eased.

“We hope to be able to resume long-term deals with foreign firms and improve  trade (import and export) in order to be able to increase our share of the international market and decrease the cost of trade with other countries.”