Hi seals et al.this seems to be the right news at the right...

Hi seals et al.
this seems to be the right news at the right time. i am interested in what others think.
andrewe

Iran's leader urges moves to boost private sector

Tuesday, February 20, 2007 - ?2005 IranMania.com

LONDON, February 20 (IranMania) - Iran's highest authority, Supreme Leader Ayatollah Ali Khamenei, told the government and officials to speed up moves to cut the state's economic role in the latest bid to revive a struggling privatisation programme, Reuters reported.

Iran tried to shake up its lumbering economy in 2004 by overturning Article 44 of the constitution which decreed core infrastructure should remain state-run. But private business has shown little appetite to invest in privatisations since then.

Critics say the government of President Mahmoud Ahmadinejad has expanded the role of the state with profligate spending policies, fuelled by windfall oil earnings, stoking inflation and making the economic environment even tougher for business.

?In parliament, the laws and rules should be passed. In the government, the managers and officials should follow up this work seriously,? Khamenei told a gathering including some of Ahmadinejad's ministers and also some of the president's rivals.

Khamenei, whose comments were carried on state television and radio, also urged the Justice Ministry to set up courts to defend ownership rights to encourage private investment.

?The government should speed up this work,? Khamenei said.

Iran has in the past fallen short of targets for sell-offs in a country where the state owns banks, airlines, utilities and a range of industries. Key industries, such as the upstream oil sector, are excluded from the programme of sales.

Ahmadinejad, who has in the past accused private businesses of seeking inflated profits, launched a plan last year to sell heavily discounted shares in state firms to the poor, part of his pledge to spread the Islamic Republic's wealth more evenly.

Economists said the so-called ?shares of justice? may change the shareholder but do not lead to the required restructuring.

?When you transfer ownership but don't transfer management, it will be the same,? said economist Saeed Laylaz.

Some analysts said Khamenei's comments could be a gentle prod to Ahmadinejad to rethink his policies. Khamenei rebuked the government in October over inflation. It is now almost 16 percent.

?These remarks made were clearly designed to hasten privatisation and put the government under pressure to put it on track,? said one Iranian analyst who asked not to be identified.

Foreigners can bid in Iranian privatisation tenders but need permission from the Economy Ministry on a bureaucratic case-by-case basis. Many foreigners are now wary of investing for fear of an escalation in a dispute over Iran's atomic plans.

Iranian investors complain that Ahmadinejad, who has complained about private businesses seeking inflated profits in the past, has not created business friendly environment.