[Peace-discuss] Fwd: [ufpj-activist] Iran offers state assets to foreigners in investment drive

[Stuart Levy]

Iran is open for business ... and up for sale?    Via UFPJ ...


-------- Forwarded Message --------
Subject: 	[ufpj-activist] Iran offers state assets to foreigners in 
investment drive
Date: 	Sat, 25 Jul 2015 20:35:55 +0000
From: 	Michael Eisenscher <m_eisenscher at uslaboragainstwar.org>
To: 	UFPJ Activist List <ufpj-activist at lists.mayfirst.org>



  Iran offers state assets to foreigners in investment drive
  <https://urldefense.proofpoint.com/v2/url?u=http-3A__www.zawya.com_story_Iran-5Foffers-5Fstate-5Fassets-5Fto-5Fforeigners-5Fin-5Finvestment-5Fdrive-2DTR20150724nL5N10434DX2_-3Flok-3D151456150724-26-26zawyaemailmarketing&d=AwMFaQ&c=8hUWFZcy2Z-Za5rBPlktOQ&r=_iuwmBDMEAIAz6k1h--JVoji6x5mlDiImSbbdIp2zWg&m=x3U2_oiEtELLGMgX49QbcJp45dcLnGZsOSeRMSgApeM&s=OdFVNx73D6qzksAML8h5ou_FtpL15HDx7LWwclnMTRA&e=>

** Major opening seen after Iran's nuclear deal with powers

** Key policies resemble those of centre-right European govt

* Minister says Tehran government to reduce role in economy

* Foreigners can buy into wide range of companies, projects

* Hawkish signals on inflation, interest rate policy

* Officials don't address labour, legal reforms in detail

By Shadia Nasralla and Maria Sheahan

VIENNA, July 24 (Reuters) - Iran offered to sell state assets to 
foreigners, said it would cut the government's role in the economy and 
pledged a tight monetary policy as it sought to attract billions of 
dollars of investment from abroad after over a decade of isolation.

At a business conference in Vienna this week, the first such event since 
last week's deal between Tehran and world powers on its nuclear 
programme, top Iranian officials outlined an economic policy package 
designed to win foreign investment.

The package was strikingly pro-market - many of the policies would not 
have been out of place in a centre-right European government. If 
implemented, they could move Iran's economy well beyond the tight 
restrictions and heavy state involvement that followed its 1979 Islamic 
Revolution.

"The government, the parliament are trying to remove all the obstacles 
for free investment and for reducing interference of government in 
private investment," said Minister of Industry, Mines and Trade Mohammad 
Reza Nematzadeh.

With a young, well-educated population of just under 80 million and some 
of the world's largest energy reserves, Iran looks likely to provide 
huge investment opportunities. Officials at the conference said Tehran 
had identified nearly 50 oil and gas projects worth $185 billion that it 
hoped to sign by 2020.

Under the nuclear deal, sanctions that have stifled Iran's economy are 
to be lifted when the International Atomic Energy Agency verifies that 
Iran is honouring its side of the bargain.

Nematzadeh said Iran expected verification in under three months, and 
that it believed it could rejoin the SWIFT global electronic payments 
system -- a key step to enable inflows of foreign money -- three months 
after sanctions were repealed.

Foreigners will then be welcome to enter Iran's economy through joint 
ventures -- including those in the banking sector -- and direct 
investment, such as participation in tenders to buy stakes in state 
companies, he said.

The national oil company will be off-limits to investors but 
petrochemical and refining firms may be partly sold off, and parliament 
has given permission for the sale of assets or projects such as 
hospitals, schools and highways, he added.

Over the past decade, the government has sold off stakes in state 
companies worth tens of billions of dollars. But its privatisation 
programme has not been fully effective because most of the stakes have 
gone to state-linked bodies such as pension funds and foundations.

Iranian bankers believe that if foreign investors are allowed to enter 
the Islamic Republic, they will end up buying assets from the 
cash-strapped funds and foundations, completing the privatisation process.

During the sanctions years, the government often favoured state firms 
over private ones on the grounds of economic survival. Nematzadeh said 
this was ending, and parliament had agreed that all firms would be 
treated equally for tax purposes.



REFORMS

For privatised companies to succeed, however, they may need to reduce 
staff. This might put them in conflict with Iran's strict labour rules, 
a legacy of the revolution; a complex, unpredictable legal system adds 
to risks for foreign companies.

Iranian officials at the conference did not describe in detail any plans 
for labour or legal reforms, which would be politically sensitive and 
could cost President Hassan Rouhani some of the public support he has 
won with the nuclear deal.

But they did outline plans for a conservative monetary and fiscal policy 
which could reassure investors. One of the big economic risks that Iran 
will face after sanctions are lifted is how to keep the economy stable 
as money flows back into the country and growth accelerates.

Parts of the business community in Iran are pressing for interest rate 
cuts to help them compete in foreign markets, and currency depreciation 
to aid exporters. Such steps could boost inflatiom which authorities 
have only recently wrestled down to around 16 percent from above 40 
percent two years ago.

Deputy central bank governor Akbar Komijani said authorities would 
continue to cut inflation, lowering it to a single-digit rate by the end 
of the next Iranian year that will start around March 21.

He also said Iran needed to achieve single-digit inflation before 
interest rates could be cut below 20 percent - implying no major 
monetary easing any time soon.

Iranian officials impressed some foreign businessmen at the conference 
by talking more openly and frankly about the economy than they did 
during the sanctions years, when officials felt that disclosing 
information could weaken Iran's ability to defend itself against the 
sanctions.

Nematzadeh gave relatively specific figures for Iran's foreign reserves 
on Friday, saying the central bank had between $115 billion and $125 
billion, the sovereign wealth fund $20-25 billion, and Iranian 
government firms and organisations an additional $5-10 billion.

Much of this money has been frozen in overseas accounts by the 
sanctions; Komijani said blocked funds totalled about $29 billion.

But he said that instead of immediately bringing the money back to Iran 
when sanctions were lifted, the central bank would keep some of it in 
accounts abroad until it was needed to fund domestic investment projects.

Such a step could strengthen foreign investor confidence by suggesting 
Tehran is confident the nuclear deal will stick.

(Writing by Andrew Torchia; Editing by Mark Heinrich) 
((andrew.torchia at thomsonreuters.com 
<mailto:andrew.torchia at thomsonreuters.com>; +9715 6681 7277; Reuters 
Messaging: andrew.torchia.thomsonreuters.com at reuters.net 
<mailto:andrew.torchia.thomsonreuters.com at reuters.net>))


-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.chambana.net/pipermail/peace-discuss/attachments/20150727/e1894457/attachment-0001.html>
-------------- next part --------------
_______________________________________________
ufpj-activist mailing list

Post: ufpj-activist at lists.mayfirst.org
List info: https://lists.mayfirst.org/mailman/listinfo/ufpj-activist

To Unsubscribe
        Send email to:  ufpj-activist-unsubscribe at lists.mayfirst.org
        Or visit: https://lists.mayfirst.org/mailman/options/ufpj-activist/slevy%40ncsa.uiuc.edu

You are subscribed as: slevy at ncsa.uiuc.edu