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Production, Foreign Capital Key to Economic Stability

The government is striving to establish calm and stability in the economy, as stability in the economic environment is a key consideration for businesses
First Vice President Es'haq JahangiriFirst Vice President Es'haq Jahangiri

The first vice president said the government's success in stabilizing the economy hinges on plans to foster domestic production and absorb foreign investment.

"The government is striving to establish calm and stability in the economy, as stability in the economic environment is a key consideration for businesses," Es'haq Jahangiri also told an economic conference on Monday on Kish Island where he also inaugurated several construction, tourism and industrial projects.

"A sound path needs to be laid for addressing national problems and challenges. [Attracting] investment and bolstering production are perquisites," IRNA quoted him as saying.

Major sectors of Iran's economy came under strain over the years of international sanctions.

Some of those sanctions were eased under the 2015 nuclear deal with major powers, in return for temporary curbs on Tehran's nuclear work.

President Hassan Rouhani's reform plans, which are aimed at attracting foreign investment in the absence of sanctions, have faced resistance from his domestic opponents.

His conservative critics remain deeply skeptical about his insistence that the sanctions-free situation is an opportunity for economic revival that needs to be fully exploited.  

They fear his plans to engage in open trade with the western world could expose the Islamic Republic to the hostile policies of their governments.

Jahangiri reiterated the government's argument, stressing that for the Iranian economy to successfully weather the current downturn, it needs to forge "a good interaction with the world".

"The most important tool at the government's disposal is the policies of Economic Resistance. The government agrees that these policies could be helpful in handling the country's challenges," he said.

Economic Resistance is a set of principles outlined by the Leader of Islamic Revolution Ayatollah Seyyed Ali Khamenei to promote domestic production and eliminate the economy's dependence on oil revenues.

The first vice president said there is a consensus among domestic economists and the other two branches of government over the need to help the Rouhani administration implement this economy policy, as instructed by the Leader of the Islamic Revolution.

***Super Challenge

Jahangiri described unemployment as a "very complicated … super challenge" confronting the economy and said, "We need to create conditions conducive to investment so it would lead to increased production and job creation."

Rouhani won reelection in a landslide in the May presidential vote, despite a fierce challenge from the conservative camp that targeted his first term's economic record. They accused him of failing to carry out his 2013 electoral pledge to revitalize the stagnant economy by tackling the scourge of unemployment, among other problems.

The president has responded by invoking the figures released by the Statistical Center of Iran, though the executive chief acknowledges that they fall far short of the number of jobs he vowed to generate.

An SCI report has put the unemployment rate in the last fiscal year (March 2016-17) at 12.4%, registering a 1.4% rise compared with a year earlier.

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