Iranian Rial

[screwball]

8 minutes ago, screwball said:

After final reviews are made and banking officials put their seal of approval on the new set of regulations, they will be formally communicated to the banking system "to take a significant step toward improving the climate of doing business in the country".

Yeah baby can't wait to see what they are 

[screwball]

10 minutes ago, screwball said:

On the order of central bank's deputy for foreign exchange and in line with increasing transparency, stabilizing regulations, clearing ambiguities, making basic rules compatible and facilitating foreign exchange services to bank customers, foreign exchange regulations are being reviewed,

 

Says it all 

[screwball]

PP now I a, getting that warm and fuzzy feeling 

[screwball]

14 minutes ago, screwball said:

Following the final agreement for a multibillion dollar South Korean finance deal for Iranian projects, private Iranian banks have signed a memorandum of understanding with their South Korean counterparts with the aim of expanding correspondent banking relationss.

The MoU was signed during a meeting in Seoul between Kourosh Parvizian, the head of Iranian Association of Private Banks and Credit Institutions and the Korea Federation of Banks Chief Ha Yung-ku on Friday.

"Banking executives of both nations met for bilateral negotiations on [removing] hurdles on the way of establishing banking ties and engaging in banking transactions, and agreed on a number of issues to expand their ties," Mohammad Reza Jamshidi, secretary-general of Iranian Private Banks' Association, told IRNA.

According to Jamshidi, a delegation consisting of chief executives with a number of major Iranian private banks and credit institutions travelled to the South Korean capital at the invitation of KFB.

"CEOs of Bank Pasargad, Bank Parsian, Middle East Bank, Shahr Bank, Bank Day, Bank Mellat, Tourism Bank and Melal Credit Institution were part of the delegation," he added.

As Jamshidi says, the two sides agreed as part of the MoU to increase their non-dollar transactions, employ new technologies in the banking industry and exchange experts for educational purposes.

Iran has been gradually working to offset the role of US dollar in its dealings and financial reporting, as longstanding initial US sanctions remain in place and that is why it prefers to engage in banking ties with South Korea in other currencies, especially euro.

"Iranian banks wanted a bigger share of the deals to be made in euro in the negotiations, which was welcomed by the Korean side," Jamshidi said.

Iranian officials have repeatedly said it would not be practical to engage in greenback since it does not play a major role in the country's currency basket and foreign exchange resources.

In a statement, KFB also confirmed that it has signed an MoU with its Iranian partners for boosting bilateral cooperation.

As reported by Yonhap, South Korea's largest news agency, the two entities agreed to facilitate banking services for exporters and importers of both countries in a move "designed to meet growing demand for financial services due to increased trade".

Jamshidi pointed out that the trip by the Iranian delegation to Seoul was made in order to follow up on and finalize initial agreements that were made as part of the former president Park Geun-hye's landmark Tehran visit in early May.

Friday's trip was supposed to take place about two months ago, he added, but it was delayed due to its coincidence with Iranian banks' shareholders' meetings.  

The MoU comes on the back of the €8 billion South Korean finance for Iranian projects finalized in Seoul last month between the Korea Export–Import Bank and 12 Iranian agent banks.

As part of the agreement, the Korea Trade Insurance Corporation is to guarantee up to €5 billion of finance activities in Iran.

 

No greenback euro all the way....

[screwball]

Iran, Venezuela consider ways to develop economic ties

Tehran, Sep 7, IRNA – Mechanism to develop economic and trade cooperation between Iran and Venezuela was considered in presence of private companies of the two states.

According to the report of Foreign Ministry Media Department, the meeting took place here in the venue of Foreign Ministry building on Thursday.

Mechanism to develop trade and economic cooperation as well as outlook for activities of Iranian companies in Venezuela market in the new developments era was considered and exchanged views by participants.

Iran's Ambassador to Caracas Mustafa A'laei delivered speech in the meeting.

1391**2050

Follow us on Twitter @IrnaEnglish

[screwball]

S Korean, Iranian banks sign agreement to bolster relations

News ID: 4082570 - Sun 10 September 2017 - 10:07

Economy

TEHRAN, Sep. 10 (MNA) – Korea Federation of Banks (KFB) has inked a Memorandum of Understanding (MoU) with Iran's Association of Private Banks (IAPB) to deepen bilateral cooperation.

As announced by KFB, the Korean body and the Iranian Association of Private Banks agreed to enhance banking services for exporters and importers of both countries.

The MOU was signed between Ha Yung-ku, Chairman of KFB, and CEO of IAPB Kourosh Parvizian in the South Korean capital of Seoul.

The Initiative is aimed at meeting the growing demand for financial services as a result of an uplift in volume of trade turnover between the two countries.

Iran signed a nuclear agreement with the 5+1 group of countries in 2015. The landmark deal led to removal of economic sanctions imposed against Iran over recent years and provided the world with access to a market with a massive population.

KFB and IAPB also agreed to expand cooperative relations between local and Iranian banks as well as to join hands in arenas that promote new banking methods.

[screwball]

Officials in Tehran have been lately speaking in favor of measures to reduce the country’s reliance on the dollar as a move that they say would make the Islamic Republic immune to US pressures at times of political conflicts. 

 

Iran has been to the same effect discussing trading in non-dollar currencies such as the euro as well as the mutual national currencies with several countries including Russia, India, Turkey and China.

[screwball]

While foreign currency rates, especially the US dollar, are gradually rising in the market, the government’s earnings from revaluation of the Central Bank of Iran’s forex resources also go up and according to the deputy head of Majlis Planning and Budget Commission, will reach up to $2.5 billion this year.

“An increase in foreign currency rates generates income for the government. For instance, the foreign exchange revaluation rate had originally been set at 29,500 rials for each dollar while the government sold it for 33,000 rials,” Hadi Qavami also told ICANA, the official news outlet of the parliament. As he points out, about 60-70 trillion rials ($1.5-1.8 billion) in revenues accrue from forex revaluation, or the discrepancy between the rates of forex resources.

“The administration is not after generating income from foreign currencies [by upping the prices] but that is what inevitably happens,” he added.According to Qavami, the government makes up for a portion of its annual budget deficit through forex revaluation and while the price for the greenback has been based at 33,000 rials in the annual budget for the current Iranian year (started March 21), it has now increased significantly and “might even reach 40,000 rials”.

This increase in greenback prices will entail revenues for the administration of President Hassan Rouhani anywhere from 70-100 trillion rials ($1.8-2.5 billion), which Qavami notes is not insignificant, “but it is not a good or reliable source of income because in a way it is an inflationary tax and means putting a hand in people’s pockets”.As to why foreign exchange and gold prices have been gradually and continuously on the rise in recent days and weeks, the lawmaker points to a decrease in oil prices as the main factor. “In the budget, each barrel had been predicted at $50, which is now being sold at $43,” he said.

Qavami noted that lower oil prices will create a budget deficit of about 370 trillion rials ($9.5 billion) by the end of the current Iranian year and when oil revenues decline, the volume of foreign currency coming into the country will decrease, leading to a rise in forex prices.

“When people take their deposits out of the banks, they transfer it to parallel markets such as the foreign currency market, which boosts forex prices because of added demand and adds to liquidity,” he said, stressing that interest rate cuts must not be implemented by force.

In conclusion, Qavami concedes that other international factors such as the recent destructive storms in the US have also impacted the rise in greenback prices, but says “these are not the main reasons”.   

 

[blueskyline]

//financialtribune.com/articles/economy-business-and-markets/72047/overhaul-of-irans-forex-rules-in-the-offing...........

1. Economy
2. Business And Markets

Sunday, September 10, 2017

Overhaul of Iran's Forex Rules in the Offing

 

 

 

The Central Bank of Iran is to reevaluate and upgrade its rules and general approaches regarding foreign currencies, says the bank's deputy for foreign exchange policies and regulations days after changes were made in regulations concerning foreign currency offered by banks to travelers.

"On the order of central bank's deputy for foreign exchange and in line with increasing transparency, stabilizing regulations, clearing ambiguities, making basic rules compatible and facilitating foreign exchange services to bank customers, foreign exchange regulations are being reviewed," Mehdi Kasraei-Pour was also quoted as saying by the official news website of CBI.

The latest significant change in the foreign exchange workings of banks came on Wednesday when the central bank issued a directive ruling that banks are allowed to "sell travel currency at open market rates starting from September 11".

Banks currently offer foreign currency with a cap of $300 to travelers at official rates that are about 600 rials lower for each dollar compared to the open market rates, meaning that the ceiling for the sale of currency for travel at lower prices is effectively removed.  

Kasraei-Pour noted that experts at CBI's Foreign Exchange Policies and Regulations Department are working to review and update regulations and will ask for the feedback of pundits in the foreign exchange network of banks.

After final reviews are made and banking officials put their seal of approval on the new set of regulations, they will be formally communicated to the banking system "to take a significant step toward improving the climate of doing business in the country".

Improving the nation's business climate has increasingly emerged as a priority across various sectors, especially in light of the World Bank's Doing Business 2017 report that indicated Iran has slightly regressed in improving its entrepreneurial climate following years of lackluster performance.

According to the report, from a total of 190 countries, Iran ranks 120th in the index for ease of doing business and is placed 16th among 25 countries in the Middle East and North Africa region.

According to Kasraei-Pour, the upgrade in foreign exchange regulations will be made in a way that "if the plan to unify the foreign exchange rates is implemented, the new regulations would undergo the least amount of changes".

The central bank has been striving to unify the dual exchange rate regime for years. While it had promised that the official and unofficial rates would be unified by the end of the previous fiscal year in March, the lack of prerequisites such as ties with credible international banks delayed the plan.

Immediately after the administration of President Hassan Rouhani began its second tenure almost a month ago, CBI Governor Valiollah Seif renewed his pledge that the rates will be unified "soon in the new administration".

As Kasraei-Pour outlines, CBI began devising rules pertaining to foreign exchange workings as part of a unified and coherent set in 2002.

That was when policymakers first became serious about unifying the dual exchange rates and decided to prevent policymaking disorder by categorizing all the rules and bringing them under one umbrella. 

Topics

Forex Regulations

Share This :

Short URL : https://goo.gl/XWua9M

[screwball]

7 hours ago, blueskyline said:

//financialtribune.com/articles/economy-business-and-markets/72047/overhaul-of-irans-forex-rules-in-the-offing...........

1. Economy
2. Business And Markets

Sunday, September 10, 2017

Overhaul of Iran's Forex Rules in the Offing

 

 

 

The Central Bank of Iran is to reevaluate and upgrade its rules and general approaches regarding foreign currencies, says the bank's deputy for foreign exchange policies and regulations days after changes were made in regulations concerning foreign currency offered by banks to travelers.

"On the order of central bank's deputy for foreign exchange and in line with increasing transparency, stabilizing regulations, clearing ambiguities, making basic rules compatible and facilitating foreign exchange services to bank customers, foreign exchange regulations are being reviewed," Mehdi Kasraei-Pour was also quoted as saying by the official news website of CBI.

The latest significant change in the foreign exchange workings of banks came on Wednesday when the central bank issued a directive ruling that banks are allowed to "sell travel currency at open market rates starting from September 11".

Banks currently offer foreign currency with a cap of $300 to travelers at official rates that are about 600 rials lower for each dollar compared to the open market rates, meaning that the ceiling for the sale of currency for travel at lower prices is effectively removed.  

Kasraei-Pour noted that experts at CBI's Foreign Exchange Policies and Regulations Department are working to review and update regulations and will ask for the feedback of pundits in the foreign exchange network of banks.

After final reviews are made and banking officials put their seal of approval on the new set of regulations, they will be formally communicated to the banking system "to take a significant step toward improving the climate of doing business in the country".

Improving the nation's business climate has increasingly emerged as a priority across various sectors, especially in light of the World Bank's Doing Business 2017 report that indicated Iran has slightly regressed in improving its entrepreneurial climate following years of lackluster performance.

According to the report, from a total of 190 countries, Iran ranks 120th in the index for ease of doing business and is placed 16th among 25 countries in the Middle East and North Africa region.

According to Kasraei-Pour, the upgrade in foreign exchange regulations will be made in a way that "if the plan to unify the foreign exchange rates is implemented, the new regulations would undergo the least amount of changes".

The central bank has been striving to unify the dual exchange rate regime for years. While it had promised that the official and unofficial rates would be unified by the end of the previous fiscal year in March, the lack of prerequisites such as ties with credible international banks delayed the plan.

Immediately after the administration of President Hassan Rouhani began its second tenure almost a month ago, CBI Governor Valiollah Seif renewed his pledge that the rates will be unified "soon in the new administration".

As Kasraei-Pour outlines, CBI began devising rules pertaining to foreign exchange workings as part of a unified and coherent set in 2002.

That was when policymakers first became serious about unifying the dual exchange rates and decided to prevent policymaking disorder by categorizing all the rules and bringing them under one umbrella. 

Topics

Forex Regulations

Share This :

Short URL : https://goo.gl/XWua9M

 

Yep..getting  closer...

[Freedomwish]

 

On 9/10/2017 at 2:52 AM, screwball said:

Banks currently offer foreign currency with a cap of $300 to travelers at official rates that are about 600 rials lower for each dollar compared to the open market rates, meaning that the ceiling for the sale of currency for travel at lower prices is effectively removed.  

 

On 9/10/2017 at 2:52 AM, screwball said:

 

Got to love this 

 

Screwball please correct my thoughts, but I read this as a possibility of an exchange rate ideally at $3 to $1?!!   Because, it's quite possible that I'm about to faint right now.....

[screwball]

n addition to establishing ties with major international banks, the plan to unify dual foreign exchange rates requires prerequisites, the Central Bank of Iran’s former deputy for foreign exchange affairs said.

“Foreign currency offered at official rates is one of the hurdles on the way of unifying the rates because within this framework, some goods become subject to forex offered at rates lower than that of the open market, which is currently about 600 rials higher,” Seyyed Kamal Seyyed Ali also told Fars News Agency.

Noting that ending the allocation of official forex rates will entail transparency and better pricing, he said studies show that goods imported at official rates do not ultimately differ from similar goods imported at open market rates, in that they do not benefit the consumer i.e. the final claimant.

According to Seyyed Ali, the official forex rate gives rise to rent-seeking behavior on the part of the importer.

He also referred to foreign currency sold at official rates by the banks for the purpose of travel, saying that before its abolition, it faced a similar condition.

On Wednesday, the central bank issued its latest directive, decreeing that as of Monday, banks are not to offer the previous $300-capped travel currency at official rates and are free to offer it without a cap at open market rates like moneychangers.

Seyyed Ali, who supports the removal of travel currency ceiling at official rates, believes that no significant problem would arise if CBI had chosen to do so years ago because people need considerably more than $300 for their travels and the currency offered at banks only provided a small respite for travelers.

As to the second requirement for rate unification, the pundit pointed out that if forex revenues from exports are injected into the markets, it would account for 80% of the import needs of the nation.

“Under such circumstances, the central bank would no longer be pressured for providing foreign currency, but this depends on creating modalities to redirect the exports revenues,” he added.

The former official said CBI could obligate exporters to sell their foreign currency revenues to the banking system, but could also present them with tax rebates and export incentives.

Although, he noted, it would also be beneficial for exporters to offer their export revenues to certified moneychangers or foreign branches of local banks because “the main goal here is for CBI to be able to observe the process so that it can have a clear sense of the foreign currency reserves of the country and make plans based on that”.

Seyyed Ali believes that CBI is right to hold out on rate unification until all the prerequisites are in place because when the rates are unified, the banking system must be able to meet all the currency needs of the country for it to take hold and remain stable.

As to whether it would be feasible and reasonable for the central bank to implement rate unification in a climate where forex rates are gradually on the rise, he said it would work because the increase is not out of the ordinary.

At present, he notes, the annual inflation rate stands at around 10% that renders the current forex rate increase of 8% necessary to avoid an imbalance that would hurt exports.  

[screwball]

8 hours ago, Freedomwish said:

 

 

 

Screwball please correct my thoughts, but I read this as a possibility of an exchange rate ideally at $3 to $1?!!   Because, it's quite possible that I'm about to faint right now.....

 

Not sure what to make of it all I know is that it I'll be worth over 1.2

[screwball]

As I said rate is mandated by law, and based on gold...

[screwball]

Remember 1932 rate was 2.605. 

[Freedomwish]

8 minutes ago, screwball said:

 

Not sure what to make of it all I know is that it I'll be worth over 1.2

Okie dokie, still all good to me!  Thanks! 

[screwball]

8 hours ago, Freedomwish said:

 

 

 

Screwball please correct my thoughts, but I read this as a possibility of an exchange rate ideally at $3 to $1?!!   Because, it's quite possible that I'm about to faint right now.....

 Maybe blue sky or PP can chime in about this one..

[sandfly]

free if i'm looking at it right that's .50

[Freedomwish]

45 minutes ago, sandfly said:

free if i'm looking at it right that's .50

Still waaaaaay better than what we have now, indeed! 

[blueskyline]

I do not know Screwball. But everything everywhere is getting very interesting 

[screwball]

Economy, Business And Markets

Wednesday, September 13, 2017

Bank Sepah to Open 3 Overseas Branches

 

Bank Sepah, a major Iranian commercial bank, plans to open branches in China, South Korea and Iraq in the near future.

In a press release published on the bank’s website, Kazem Choghazardi, Sepah’s chief executive, said his bank has taken the preliminary steps for opening overseas branches and intends to start operations in China, South Korea and Iraq after receiving the permissions from Iranian and local authorities.

Sepah would be the first Iranian lender to open a branch in China, Iran’s largest commercial partner. Tejarat Bank had a corresponding office in Beijing, which is not operating at the moment.  Currently, Bank Mellat is the only Iranian bank with a branch in South Korea. However, Iranian banks have an active presence in Iraq. Bank Melli Iran has a branch each in Baghdad, Najaf and Basra. Parsian Bank has a branch in Baghdad. In May, Iran’s Tourism Bank also opened a branch in Najaf.

Except for 1,800 domestic branches, Bank Sepah has active branches in Rome, Paris, Frankfurt and London.

“Overseas branches of Sepah processed €556 million worth of transactions in the first five months of the current Iranian year (started March 21),” Sepah’s chief executive said.

“The bank’s total forex transactions reached $5.8 billion in the four months to July 22, marking a 134% growth compared with the same period of last year.”

Choghazardi noted that Sepah has opened or reactivated 55 accounts in 28 foreign banks since the lifting of nuclear sanctions on January 2016.

[screwball]

Iran and Brazil underlined the necessity of improving banking relations to boost bilateral trade and investments.

These and other issues were discussed in a meeting attended by Brazilian Executive Secretary of the Ministry of Agriculture, Livestock and Supply Eumar Roberto Novacki and the officials of Iran Chamber of Commerce, Industries, Mines and Agriculture

During the meeting, the head of Iran-Brazil Chamber of Commerce said the biggest hurdle in the way of expanding ties between the two countries, especially in the agriculture sector, is banking problems, ICCIMA's official website reported.     

"Iran and Brazil have high trade potentials, therefore the volume of our imports and exports could significantly increase if we manage to remove the banking hurdles," Kaveh Zargaran added.

Brazil's Ambassador to Iran, who also attended the meeting, noted that effective steps have been taken to improve banking ties between Iran and Brazil and a month ago, a banking delegation from the Central Bank of Iran visited Brazil to survey the banking and financial problems.

"A number of Iranian banks have signed cooperation agreements with Brazilian lenders, which has had promising results," Rodrigo de Azeredo Santos added.

The South American country's ambassador announced that Brazil's National Bank for Economic and Social Development has agreed to finance Iranian projects, if the Middle East country's banks guarantee the repayment of the allocated credits.

Santos believes that the plan might be realized by the end of 2017.

"Joint meetings between the two countries' business people are highly important, as they boost cooperation between the private sectors of Iran and Brazil, and also improve political ties," he said.

 ICCIMA's deputy head, Pedram Soltani, said there is a big gap between Iran and Brazil's trade balance, as the volume of Iran's exports is significantly lower than imports.

"In the past few years, despite our nuclear sanctions, we met our agricultural needs from Brazil, therefore a mutual trust has been among both countries' merchants that they can continue their trade without worrying about political disputes but now we should try to also export more products to Brazil," he added.

Soltani noted that Iran and Brazil have always had friendly ties that have gotten stronger, especially in recent years.

"Brazil has one of the biggest economies with undeniable capabilities in various sectors and is one of the major partners of our traders," he said.

Brazil exported about $2.2 billion worth of commodities to Iran and imported commodities worth $75 million in return in the last Iranian year (ended March 20, 2017).

Iran's private sector has called on the government to consider allocating incentives, especially transportation subsidies in view of the long distance between the two countries, to Iranians exporting to Brazil in order to secure a foothold in South America’s biggest market.

Soltani further said Iran can benefit from Brazil's know-how in agriculture sector while both countries can engage in joint investment projects in the field.

"The fact that ICCIMA opened a joint chamber with Brazil before many of our neighboring countries proves the importance of this South American country for us," he said.

For developing business ties between the two countries, Iran-Brazil Chamber of Commerce was officially inaugurated on July 9. It is the first and only joint chamber with a South American country.

The executive secretary of the Brazilian Ministry of Agriculture, Livestock and Supply emphasized on his government's efforts to expand bilateral trade ties with Iran.

"The first Iran-Brazil Agriculture Council Meeting will be held on November 21-22 in Brazil and we invite Iranian private-sector companies along with the government sector to attend this meeting," he added.

Novacki noted that the meetings will help draw a roadmap for expansion of economic relations between Iran and Brazil.

[screwball]

The multibillion dollar South Korean deal to finance Iranian projects and the recent agreement between major Iranian private banks and their South Korean counterparts to boost correspondent ties have prodded top international lenders to strengthen their ties with Iranian banks.

According to the Export Development Bank of Iran’s chief executive, the situation has changed a lot compared with a few years ago as the level of cooperation with major foreign banks has significantly improved.

“After Iran’s nuclear deal, only small- and medium-sized foreign banks forged correspondent banking relations with Iran but after a few years, major international lenders  started working with Iranian banks,” Ali Salehabadi also told the state radio.

He mentioned Germany’s Deutsche Bank  as an example of  a big lender that had no ties with Iran in the past, but currently accepts Iranian payment orders and processes  their requests.

Deutsche Bank is one of Germany’s leading banks, with a strong position in Europe and a significant presence in the Americas and Asia Pacific. The bank provides banking services to corporations, governments, institutional investors, small- and medium-sized enterprises, and private individuals.

EDBI’s top official named Belgium’s KBC bank as another major European bank that has good ties with Iranian banks.

“Austria’s Oberbank, which already has good ties with Iran, is going to sign a new banking deal with our country in the foreseeable future wherein EDBI will also be a part of the contract to receive a credit line,” he said.

According to the EDBI chief, the bank has correspondent relations with 124 banks across the world.

Salehabadi also announced that Bank Mellat’s Seoul branch has resumed activities in South Korea.

The bank was closed for years due to nuclear sanctions but following the negotiations of the Central Bank of Iran and Foreign Ministry with South Korean officials, the bank once again is open and ready to offer various types of services to business people and merchants.

[screwball]

Iran’s largest holding, Social Security Investment Company, is set to offer the shares of all its subsidiaries on the equity market by the end of the current fiscal year (March 20, 2018), the deputy head of the company’s board of directors said.

“Currently, 75% of our subsidiaries are listed on the equity market. We are planning to list the rest by next year to make them more competitive and their financial status more transparent,” Morteza Lotfi was also quoted as saying by ILNA.

The investment arm of Social Security Organization, also known by its Persian acronym Shasta, controls nine holdings operating in a wide range of sectors, including petroleum, petrochemicals, pharmaceuticals, cement, transportation and finance.

These holdings manage about 200 subsidiaries, have 1,000 board members and control assets worth 350 trillion rials ($9.02 billion).

Subsidiaries of two holdings, namely Tamin Pharmaceutical Investment Company and Tamin Petroleum & Petrochemical Investment Company are already listed on the equity market.

According to SSIC’s Managing Director Reza Norouz-Zadeh, the holdings slated for listing are Tamin Cement Investment Company, Tamin General Industrial Holding Company and Tamin Construction and Transportation Investment Company.

“We have asked [Securities and Exchange Organization] to analyze and pave the way for the three holdings to go public. We initially plan to offer less than 5% of their shares for price discovery and then follow it up with offering 30%. This way, Shasta will keep a 64% stake in them,” Bourse Press quoted the official as saying.

SSIC’s portfolio is vast, as the numbers indicate. The cement holding, for instance, manages 13 cement companies, three mining factories and three engineering plants, most of which are the largest in the industry and account for 40% of national output of the material.

However, the impressive portfolio does not mean the holdings are thriving.

 An Impaired Giant

Lotfi said Shasta acquired more than 90% of its assets as a result of the government’s debt settlement and 70% of them are either running at losses or underperforming, while the only returns it gets are from the 30% it had established.

SSIC’s gargantuan size is in fact due to the policies of the previous administration that handed stakes in state-owned companies in lieu of its debts. The companies, already poorly run, were forced on SSIC at arbitrary prices.

According to Lotfi, the government is over 1 quadrillion rials ($25.7 billion) in debt to the Social Security Organization.

“The figure has surged from 60 trillion rials ($1.54 billion) in the past decade. This is while SSO has to pay about 750 trillion rials ($19.2 billion) in pension every year, with a good chunk of it coming out of SSIC’s revenues,” he said.

What makes things more convoluted is that the industries SSIC is involved in are going through a rough patch. The cement industry, for instance, is suffering from a 44% production overcapacity in the face of continuously diminishing demand in the construction sector.

And exports, the only way out of a domestic demand deadlock, stand at about 10% of production due to trade wars with neighbors and the high cost of shipping to other continents.

Pharmaceutical companies are also on the rocks.

According to Norouz-Zadeh, the industry is having trouble maintaining profits due to the long delays in receiving purchase payments, largely due to the overall lack of liquidity in the market.

And last but not least, SSIC’s shares in the steel industry have been dragging it down. The financially embattled Esfahan Steel Company has been drowning in debt for the past few years and 55% of its shares are owned by SSO.

The latest statistics indicate ESCO’s accumulated losses stood at 21.03 trillion rials ($544.86 million) by the end of this year’s first quarter (ended June 21) while its total debts also stand at 83.25 trillion rials ($2.15 billion).

Investors at Tehran Stock Exchange and Iran Fara Bourse will probably not be lining up to buy the shares of SSIC’s holdings unless things improve financially, which in turn means the economy steering toward growth.

Still, SSIC is thinking about expansion.

According to Lotfi, the company has invested about 500 trillion rials ($12.8 billion) in different projects, including a pharmaceutical plant in northwestern Iran, a cement plant in Iraq and a mining project in Africa.

“Talks are underway with the Turkish government for dual listing of some of SSIC’s subsidiaries on Borsa Istanbul, which would be a positive step toward attracting foreign investment,” he said.

[screwball]

Iran President stresses attracting investment of Iranian expatriates

Tehran, Sep 13, IRNA – Iran's President Hassan Rouhani stressed on Wednesday the importance of attracting investments by Iran's expatriates and foreigners to accelerate the country's development.

The obstacles to this end and the hindrances to attract the private sectors should be removed, Rouhani said at the cabinet session held this morning.

Addressing the meeting, the Iranian president said that the country's officials should pay special attention to the issue of 'moderation', urging all governor-generals in the Iranian provinces to make their picks based on aptitude and skills.

Rouhani further called for turning the economic growth in the country into 'tangible economic growth'. 

Then, he underlined the necessity of providing the due tools for achieving this end.

During today's cabinet session, seven governor- generals got vote of confidence from the government.

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