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Key Economic Data 
  2002 2001 2000 Ranking(2002)
Millions of US $ 107,522 114,100 101,600 34
GNI per capita
 US $ 1,710 1,680 1,650 115
Ranking is given out of 208 nations - (data from the World Bank)

Books on Iran


Area (
1.648 million



Iranian rials

Mohammad Khatami-Ardakani


Update No: 033 - (26/08/04)

War of words escalates on the US front
During August the rhetorical campaign of the Bush administration against the Iranian eshtablishment continued to accelerate, with bellicose statements coming from Condoleeza Rice and John Bolton, under-secretary of state for arms control. The Bush administration, in short, is implying with increasing strength that covert action and air attacks are not ruled out as a way to prevent Iran from developing nuclear weapons. For sure at the forthcoming 13 September meeting of the International Atomic Energy Agency (IAEA) the Bush administration will ask that Iran be declared in breach of the non-proliferation treaty, a step that if successful would likely lead to the establishment of sanctions against Iran. Members of the administration have been claiming that even key European countries are now moving in such a direction, although this might be an overstatement, as even Britain, traditionally the most pro-US European country, does not seem to have abandoned the policy of "constructive engagement" yet. Despite the increasing toughness of the Bush administration, which might be linked to the forthcoming presidential elections, Washington's stand suffered a blow in August when the IAEA established that at least some of the samples of enriched uranium found in Iran were indeed of foreign (Pakistani) origins, as claimed by Teheran. Although the origin of the large majority of the samples has not been tracked down, the announcement lent some credibility to the claim that Iran was never involved in enriching uranium. 

And on the Iraqi front too
If on the front of the nuclear program Teheran could still hope to hold out for some time as the end of August approached, it was obviously very worried by the rapid deterioration of its relations with the new Iraqi government. Already in July the Iraqi Interior Minister had accused Iran of being involved in the unrest in Iraq, while the Defence minister was even more blunt. Teheran reacted by dismissing the accusations as the product of the "inexperience" of the ministers involved. The initial controversies were apparently settled when a spokesman for Iraqi Prime Minister Allawi declared that the views of individual ministers were not those of the government as a whole. At the beginning of August another row emerged when Iraqi Prime Minister Allawi postponed his visit to Teheran, alleging the presence in Teheran of a "political opponent". Furthermore, the Iraqi Defence Minister, however, continued his verbal attacks on Teheran, asking on 4 August that Iran immediately returns 130 planes held since Saddam Hussein sent them to Iran in 1991. By mid-August rumours were circulating in Baghdad that 30 Iranians had been caught fighting with the Shiite rebels and that Iranian weapons had been found in the hands of the followers of radical cleric Al-Sadr. Then four alleged Iranian intelligence officers were arrested by the Iraqi police. Finally, four staff members of the Iranian news agency (IRNA) were arrested in Baghdad, presumably because of their reporting, very favourable to al-Sadr and his movement. In this context, the fact that Iran's Export Guarantee Fund has been authorized in August to cover exports to Iraq, in order to strengthen the business ties between the two countries, is unlikely to have much impact at the diplomatic level. 

Old enemies Turkey and Saudi Arabia come closer
As has been usual over the last few years, Tehran continues to try to strengthen its links with the neighbouring countries. The most remarkable development in August was the declaration of Saudi Crown Prince Abdullah that Iran is a "brotherly and friendly" country. The new friendship with Saudi Arabia, once a sworn enemy of Iran, is likely the outcome of the pressure under which both Teheran and Riyad are from the US government. Although the visit to Teheran of Turkish Prime Minister Recep Tayyip in July was not an unqualified success, two memos of understanding were signed, which committed the two countries to improve trade relations and to improve security cooperation. The Iranian government still has great hopes for the expansion of trade with Turkey, which it hopes will reach US$5 billion this year. Moreover, the Turkish Prime Minister did not mention at all the issue of Iran's nuclear program. The issue of the price of Iranian gas, which the Turkish government wants to see substantially reduced, and those of the new Teheran airport and of a new deal for building Iran's first privately owned mobile phone network, were all left unresolved. The mobile phone deal might still be sealed soon, but in the case of the Teheran airport a major factor preventing a positive resolution was the interference of the Revolutionary Guards, which are trying to replace the Turkish company which won the tender for operating the airport with another in which key commanders in the Guards have interests. 

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Iran sets up wind turbines in Armenia

According to Tehrantimes, the Managing Director of Sanir Company, Alireza Kadkhodai, said on August 2nd that Iran will start installing wind turbines in Armenia as of next year. 
Kadkhodai added that necessary studies have been carried out and a suitable location has been selected. "Wind farms are usually built on small scale and low capacity. The Armenian wind farm would compromise four units with total capacity of 2.6MW which can be developed to 20MW," he noted.

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Azerbaijan, Iran sign cooperation agreements

Ten agreements on cooperation between Azerbaijan and Iran in various spheres were signed in Baku on August 5th, Interfax News Agency reported 
An Interfax correspondent reported that Azerbaijani President, Ilham Aliyev, and Iranian President, Mohammad Khatami, took part in the signing. 
The agreements include a deal on Iran presenting a US$75m credit to construct four substations for the Imisli-Ali-Bayramli-Astara power line, as well as an agreement on cooperation in the sphere of exchanging natural gas.
The sides signed a memorandum of mutual understanding between the two countries' ecology agencies, and an agreement on cultural cooperation, a protocol on cooperation in the transport sphere and a memorandum on the financing of the Baku-Astara road's reconstruction.
A memorandum on trade in regions near the border, an intergovernmental trade agreement and an intergovernmental agreement in the spheres of security and law-enforcement have also been signed. 

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