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Corruption Revisited
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Corruption prevails among the people irrespective of their level of education; wittingly or otherwise.
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Economic and financial corruption, in all its forms and manifestations, exists in both developing and advanced countries. Efforts of governments and organizations to counter this ugly phenomenon are essentially viewed as a sign of efficacy and health of a government.
According to IRNA, following the victory of the 1979 Islamic Revolution, steps were taken to fight the scourge. However, apparently these measures have not yet produced the desired results. About eight years ago, the leader issued an eight-article decree urging officialdom and the people to launch an all-out drive to confront and eventually uproot corruption.
This was indeed a good omen and marked a new era in the anti-corruption drive. The leader’s decree stressed that the root causes of corruption should first be identified. It urged national determination to draw up a systematic plan of action. The decree further underlined that all state organizations and the people assume responsibility in the anti-corruption campaign. It noted that bias should be avoided in identifying and uprooting corruption.
Most officials maintain that the directives of the leader have not yet been fully implemented. It cannot and should not be doubted that continuation of this trend will result in nothing but wastage of resources and further corruption in all spheres. Economic corruption is a very complex and non-transparent phenomenon which mostly remains hidden to the society. Hence, methods to counter the ominous phenomenon must above all comply with its characteristics.
It seems that corruption grows within the government. On one side there is a corrupt governmental official and on the other the people who break the law and offer bribes. Here governmental official refers to a wide spectrum of the public sector, ranging from senior political leaders to governmental employees in remote rural areas. Furthermore, implications of economic corruption can be sought among all members of the society as well as non-governmental people and companies in the private sector. In various theoretical considerations to uproot corruption, more attention has been given to corrupters, i.e. the people who offer bribes in return for privileges. This is while in some other theories the corrupted are attributed more attention.
Economic corruption in Iran dates back to several decades before the victory of the Islamic Revolution. Corruption prevails among the people irrespective of their level of education; wittingly or otherwise. It must also be understood that the frontiers of economic corruption are not clear.
It is obvious that any preventive measure should conform to the very characteristics of the phenomenon, as otherwise it is doomed to failure.
All in all, given the present circumstances a preventive plan must be devised which matches the outlines of the five-year developmental plans and the leader’s decree.
It is crucial that the outlines of Article 44 must be implemented faster and more accurately. Furthermore, the role of the people in countering corruption must be clearly defined. It is also necessary that the macro plan is executed continuously and efficiently without hesitation.
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Turks to Discuss Gas Cooperation
A Turkish delegation will arrive in Tehran soon to discuss involvement in phases 22-24 of South Pars development project, announced a deputy oil minister.
Hossein Noqrehkar Shirazi said the delegation is due in Tehran before May 20. “During a visit of an Iranian expert group to Turkey earlier this year, Turkish officials sought details about the offshore and onshore aspects of phases 22-24 of South Pars gas field development project and we hope to clear things up in the Tehran meeting,“ he told Moj news agency.
The official added that gas exports and investment in this sector will top the agenda.
Export of 20 percent of gas extracted from Phases 22-24 of the South Pars field, which is equivalent to 35 billion cubic meters per annum, construction of a gas pipeline from South Pars to the Turkish border and permits to transport Iran’s gas to Europe via Turkey and Turkmenistan’s gas to Turkey via Iran are among the main provisions of agreements signed earlier between Iran and Turkey.
Based on the agreement signed by energy ministers of the two countries, Turkey will invest in developing Phases 22, 23 and 24 of South Pars field.
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Self-Sufficiency
In Veterinary Drugs
Through planning and efforts of specialists, State Veterinary Organization has reached about 95 percent self-sufficiency in veterinary drug production, disclosed the head of the organization.
Currently about 120 Iranian pharmaceutical factories produce 200 kinds of drugs, Mojtaba Norouzi explained to IRNA.
Effective steps have been taken in cooperation with the private sector in synthesizing Vitamin E and producing other vitamins in synthetic forms, he said.
Close to 70 percent of the vaccines for livestock, poultry and aquatics are produced in the country, he said, adding the organization plans to achieve 100 percent production target within five years.
Drought reduces the livestock’s immunity system and leads to increase in diseases, Norouzi continued.
Given Iran’s special geographical condition, livestock diseases are common and this makes the responsibilities of the veterinary sector even heavier. To counter the diseases, the organization has embarked on extensive nationwide vaccination campaign for rural and tribal livestock with financial assistance from the government, the specialist concluded.
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Oil Stored in Tankers Doubled
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10 tankers hold at least 20 million barrels of oil, equal to about 5 days of IranÕs output.
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Iran, OPEC’s second-largest oil producer, more than doubled the amount stored in tankers in the Persian Gulf, people familiar with the situation said.
The 10 tankers hold at least 20 million barrels of oil, equal to about five days of the country’s output, said the people, who asked not to be identified because the information isn’t public. Rates for tankers have more than tripled since April 8, based on data from the Baltic Exchange and ship-fuel prices.
While oil rose to a record $119.93 a barrel on April 28, Iran has a glut of its sulfur-rich crude as refineries that can process the fuel shut down for maintenance. The discount on Iranian heavy crude compared with Oman and Dubai petroleum has more than doubled since the start of the year, according to data compiled by Bloomberg.
“There’s not much demand for heavier crudes such as those from Iran,“ said Anthony Nunan, assistant general manager for risk management at Mitsubishi Corp. in Tokyo. “It’s the peak of the refinery maintenance season in Asia, and Iran also sells oil to Europe and the Mediterranean, where some refineries are having turnarounds,“ or seasonal shutdowns for repairs, he said.
Iran’s use of ships for storage cut the supply of available supertankers, owned by companies including Hamilton, Bermuda-based Frontline Ltd. and Euronav NV, based in Antwerp, Belgium. The number of double-hull very large crude carriers (or VLCCs), available to rent within the next 30 days dropped to 28 from 56 a month ago, according to Paris-based broker Barry Rogliano Salles.
The benchmark tanker rental rate for voyages to Asia from the Middle East is $148,000 a day, compared with $44,300 on April 8, according to prices from the London-based Baltic Exchange and a formula from Oslo-based RS Platou Shipbrokers A/S.
Iran previously stored its Soroush and Norouz heavy crudes in state-owned tankers because the sulfur content made the fuel too difficult for refiners to process.
Previous buyers of the oil include SK Corp., South Korea’s biggest refiner, and Reliance Industries Ltd., India’s biggest company by market value.
Limited domestic processing capacity in Iran requires the country to import about 40 percent of its gasoline because national refineries can’t make enough. Lighter crude with less sulfur is costlier as it yields more profitable products such as gasoline.
Iran typically keeps two or three supertankers on standby to deliver crude, Per Mansson, a tanker broker at Nor Ocean Stockholm AB, said by phone.
“There’s a lack of on-land storage and this enables quick supply“ to buyers in Europe and Asia, he said.
Soroush and Norouz crudes contain about 3.5 percent sulfur. Syria’s Souedieh, at 3.9 percent, is the only grade in the Middle East with more, according to data from New York-based Energy Intelligence Group.
The discount for Iranian heavy crude relative to lighter Omani and Dubai oil is at $3.25 a barrel, compared with $1.49 in December, data on Bloomberg show.
State-owned National Iranian Tanker Co. is also hiring vessels in the single-voyage, or spot, market for contracted shipments for the national oil company. Normally, the shipping line uses its own vessels.
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Mahallat to Host Int’l Flora Exhibit
The Eighth International Flora and Ornamental Plants Exhibition will be held in Mahallat, Markazi province, from August 21-25.
Announcing this, Mahallat governor told IRNA that the exhibition aims to introduce the products of the province to domestic and foreign companies, increase exports and establish a proper venue for exchange of information.
“Some 168,000 people participated in last year’s exhibition,“ Khodarahm Kiani said, expressing hope that the number of participants would increase in the upcoming event.
He noted that some 900 hectares have been devoted to cultivation of ornamental plants and growing flowers in Mahallat which exports flowers to all over the worlds, mostly Europe. Experts believe that Iran can turn into one of the leading exporters of flowers in the world provided that necessary infrastructure is available.
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$6b Invested
In Petrochem Plants
Bakhtar Petrochemical Complex has announced that it has invested some $5.9 billion in 12 affiliated plants so far.
The complex’s managing director, Abbas She’ri-Moghaddam said that all 12 complexes as well as the West Ethylene Pipeline (WEP) will become operational within the next three years.
The West Ethylene Pipeline begins in Asalouyeh, Bushehr province and is linked to the petrochemical plants and provinces in western Iran. The aim of the pipeline is to expedite the development of deprived region, he said, according to PIN.
The official recalled that in November 2002, the government decided to establish the West Ethylene Pipeline to transfer ethylene gas from Asalouyeh to the southern and western provinces to compensate for the underdevelopment and to stimulate production in the region.
“Due to the huge amount of water needed by ethylene or ethane producing complexes, the plants have been set up in the southern part of the country near the Persian Gulf,“ he concluded.
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Banks Blamed for High Housing Prices
Caretaker of the Ministry of Economic Affairs and Finance has said that some banks are responsible for the sharp rise in the price of houses.
Hossein Samsami told reporters that the failure to manage liquidity and market stimulation, created by a number of banks in the housing sector, are the main factors for the hike in prices, reported Fars news agency.
“A strong tax regime can help us support production and combat harmful activities,“ he noted, adding that such a move would stabilize the economy and help boost welfare.
Samsami said that implementation of Article 44 of the Constitution should be seriously pursued.
He called for further discussion on the issue of economic mafia, adding that undoubtedly a number of profit seeking groups are involved in importing certain commodities. “However, I do not have sufficient information on this,“ he noted.
He declared that new bank lending rates will be announced next week. Samsami said earlier that the ministry will adopt new strategies to improve economic indices.
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Competition a Must for Social Justice
Former Supreme National Security Council secretary Ali Larijani said Friday that economic competition is a prerequirement for the establishment of social justice.
“There is no justice in a country where there is no competition for production,“ Larijani said in a pre-sermon address at the Friday prayers in Tehran, reported IRNA.
“There should be competition for generating wealth, not implementation of socialist views. Justice means all should be treated equally before the law and the economic system should be based on ’production and growth’,“ he stated.
From the Islamic viewpoint, a healthy society depends on a healthy economy, Larijani pointed out, adding that Majlis should become a symbol of unity.
Experts say competition gives incentives for self improvement. If two companies are competing for business, they will lower prices and improve quality to increase sales.
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IPI Talks Soon
The oil Ministers of India, Pakistan and Iran will soon hold talks
to sort out safety and security issues pertaining to the $ 7.4 billion
Iran-Pakistan-India gas pipeline that would pass through Pakistan.
Foreign Investment Up
Foreign direct investment increased by 10 percent in the year to March 2008 compared to the figure in the previous year, director general of Iran’s Investment and Economic/Technical Assistance Organization Ahmad Jamali said.
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Investment Talks With Bahrainis
Iranian and Bahraini businessmen discussed investment opportunities in their fifth joint meeting in Manama on Saturday.
Iran’s economic attachˇ in Manama, Mostafa Sadat told IRNA that during the five days of talks, the two sides will study the establishment of shipping, airline and medicine companies.
“Iran-Bahrain trade exchanges have increased from $20 million to $170 million in a decade. There are over 20 weekly flights between Tehran,Shiraz, Mashhad and Manama,“ he said.
Sadat said that the establishment of joint companies in the food and industrial sector will also be brought up in the discussions.
The Iranian delegation is headed by Yahya Al-e Eshaq, head of Tehran Chamber of Commerce, Industries and Mines. Bahrain MP Jassim Hussain, a member of parliament’s finance and economic committee told Reuters that the US has exerted heavy pressure on Persian Gulf Arab states, including Bahrain, to restrain economic and financial ties with Iran, adding that Manama cannot ignore its trade with Tehran.
“There has been a lot of pressure on Bahrain by the US. Iran is a major trading partner of Bahrain and has a lot to offer in fields such as food, energy and tourism.“
Tajik Tractor Production to Resume
Head of Iran Tractor Manufacturing Company and two senior officials of the company in a meeting with the Tajik Industry and Energy Minister Shirali Gulev in Dushanbe Friday discussed issues of mutual interest, including the resumption of tractor production in the central Asian state.
According to IRNA, Iranian ambassador to Dushanbe Ali Asghar She’rdoust was also present in the meeting.
At the meeting, Iranian industrialists spoke of problems encountered by their company in Tajikistan and the Tajik minister pledged to remove the obstacles and create necessary conditions for the resumption of the company’s operations.
Both sides agreed that Tajiran, which assembles Iran Tractor company products, will resume its operation in Tajikistan.
The Iranian delegation also asked the minister to create opportunity for Tajik farmers to buy tractors based on leasing.
Iran Tractor Assembly Plant ’Tajiran’ was established in 2006 with an investment of $10 million in Tajikistan but had to suspend operations because of problems.
US Concerned About Energy Deals
The US and its allies fear that a recent gas deal between Iran and Switzerland may encourage other deals between Tehran and Europe.
“The worry is that the Swiss deal will lead others, such as the Austrians, to confirm energy investments in Iran, and that companies like (France’s) Total could then follow suit and sign contracts,“ an unnamed western diplomat told Financial Times.
Despite US pressure for tougher sanctions against Iran, Tehran and Bern signed a 25-year supply agreement in March, worth up to $42 billion. “There is a lot of attention on sanctions on Iranian banks, but investment in the energy sector is much more important for Iran’s economy,“ he added.
Washington and its allies are concerned that new energy agreements between Iran and European companies may further lessen the effect of sanctions against Tehran as Asian firms have long defied the US and signed such deals.
Flynt Leverett, a former US National Security Council adviser on Middle Eastern issues, said Sinopec of China and SKS of Malaysia had concluded deals with Tehran even after sanctions forced US companies to stop signing supply contracts with Iran.
Leverett said Washington has limited options. “The EU would effectively take us to court at the World Trade Organization and the US would probably lose.“
Meanwhile, senior Iranian oil industry official Hojjatollah Ghanimifard maintained that Tehran has a right to meet the energy needs of consumers. “Would it be wise to deprive the common people living in consuming countries of supplies from Iran?“ he asked.
Trade Law Unfriendly to Private Enterprise
Majlis Research Center’s Office for Economic Studies which has examined the effectiveness of the policies of Article 44 of the Constitution, has said that optimum implementation of the provisions of the article is only possible by amending trade laws.
Once the amendments are made, the private sector will be able to promote the country’s global status and ensure success in international trade, the center contended, according to Fars news agency.
Studies have indicated that some regulations pertaining to customs, import-export and non-usury banking system are more in favor of the state sector rather than the private sector as they provide quotas, exemptions and subsidies. This has created an unfair atmosphere for competition between trading through legal channels and smuggling.
Plan to Develop, Productivity Entrepreneurship
The Labor Ministry will create employment and ensure job security in the Iranian year to March 2009, declared the Labor Minister Mohammad Jahromi.
He referred to plans drawn up by his ministry to develop entrepreneurship and improve productivity, adding the country’s economic institutes should move toward producing goods with better quality and lower price, ISNA reported.
“The target would be materialized through innovation and productivity,“ he noted.
He hoped that banks would continue to grant loans to enterprises with quick returns in the current year.
“We recommend that provincial governorates general, employment and investment councils prioritize the new schemes before submitting them to banks,“ Jahromi said.
The minister noted that projects worth 600,000 billion rials are being studied by banks, of which 300,000 billion rials have been approved.
He added that banking facilities should be granted according to a well-defined system, adding liquidity should be managed and channeled toward production sector.
He hoped that the economically viable plans, approved by banks, would get good results in the current year under the supervision of banks, employment and investment councils as well as the people themselves.
No Ultimatum to Total, Shell
Iran has not issued any ultimatum to Total and Royal Sell oil companies on the development of South Pars gas field, said Oil Minister Gholamhossein Nozari.
“Iran has issued no ultimatum to Total and Shell on the development of offshore South Pars gas field,“ MNA quoted Nozari as saying on Friday.
“The presence of these companies in phases 11 and 13 of South Pars is continuing as per schedule,“ he said. “The West has been reporting that Iran was in the process of expelling Total and Shell. In fact, no ultimatum has been issued to them,“ he added.
South Pars is one the world’s biggest gas-fields, extending across an offshore area in the Persian Gulf shared by Iran and Qatar.
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