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Key Economic Data 
  2003 2002 2001 Ranking(2003)
Millions of US $ 136,833 107,522 114,100 34
GNI per capita
 US $ 2,000 1,710 1,680 110
Ranking is given out of 208 nations - (data from the World Bank)

Books on Iran


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1.648 million




Iranian rials

Mohammad Khatami-Ardakani

Update No: 048 - (28/11/05)

Striving to avoid referral
After the IAEA decision last month, which put Iran just one step away from referral, Teheran has been engaged in damage limitation. On 20 October Iran handed over to IAEA the requested documents and allowed its inspectors to question one of the key official involved in the nuclear programme. Interestingly, US officials called this an important concession. At the same time, Iran had been putting pressure on IAEA members not to vote in favour of a referral on 25 November, when the next session at IAEA takes place. The South Koreans have been the most heavily targeted, with a ban on some of their exports, even if it is clear that South Korea's vote in October was motivated by its concerns with North Korea and not by a particular willingness to align with the US. Other tools are being used with some countries. For example, in the case of India, Iran despatched its officials to convince the left wing parties in the government coalition to maintain pressure on the Indian Prime Minister not to vote for a referral. 
In the event, the IAEA have postponed a referral to the UN Security Council following an inconclusive debate. Both the US and the troika of European powers involved in negotiations, Britain, France and Germany, sensed some signs of a shift in the Iranian position and decided to allow more time for further negotiations.

A loose cannon?
However, Teheran's case has been undermined by the apparently inept behaviour of President Ahmadinejad, who in November by delivering one of his usual anti-Sionist speeches offered the opportunity to the European press to unleash a wave of criticism. While the untimely speech itself was probably due to the new President's inexperience, he stood by its content afterwards, adding to the damage. It looks likely that radical circles close to Ahmadinejad are encouraging him to take such stances, in order to sabotage the efforts of the moderate conservatives to come to an understanding with the Americans, which they probably fear would favour their adversaries. In this optic Ahmadinejad's decision to purge the Iranian diplomatic corps of moderates and appoint new faces does not necessarily look as lunatic as some commentators have said. The ambassadors to France, Germany and the United Kingdom, the three European countries involved in negotiations with Teheran, are all being replaced, as well as the ambassador in Geneva, who was also involved in the nuclear discussions. The Iranian team to the UN has also been completely changed. Some serious damage might derive by sending a team of inexperienced diplomats to such important negotiations and the reappointment of Javid Zarif as permanent representative to the UN (he had resigned a month earlier) might be a sign that the regime is worried about not pushing the purges too far. However, in terms of factional competition within the conservative front the move might prove advantageous. Unsurprisingly, the main criticism of Ahmadinejad's move came from Hashemi Rafsanjani, who is once again trying to take the lead in the negotiations with the Americans. On the other hand, Supreme Leader Khamenei is trying to position himself between the two conservative factions, radical and pragmatic, sometimes apparently favouring Rafsanjani, some other time coming out in support of Ahmadinejad. 

The purges are coming
The purge of the diplomatic corps was not the only such purge to take place in November. At the beginning of November Ahmadinejad also replaced the managing directors of the state-owned banks. The President, after all, had promised to bring new faces into government, although some argue that Ahmadinejad might just want to be surrounded by people with little personal power base in order to be able to dictate policies more easily. Nonetheless, Ahmadinejad is facing serious trouble in the parliament and had to withdraw his second nominee for the position of oil minister, Mahsuli, a former revolutionary guard who was again seen as lacking the necessary preparation by many deputies. The President finally had to propose a technocrat from the National Petrochemical Industrial Company as his third candidate to the post, Sayyed Mohsen Tasaloti. Even some fundamentalist groups, like Ansar Hezbollah, criticised the President's penchant for choosing cronies, although what they demand is the appointment of religiously committed individuals. In the meanwhile contradictory reports continue to emerge with regard to Iran's oil output. In November the director of the National Iranian Oil Company admitted that some decline in production might occur soon, due to "technical problems". 

Stalled privatisations
Although Ahmadinejad adopted a statist rhetoric, the people that he appointed to leading posts in the economy are considered to be relatively liberal. Still, little progress is being made on the privatisation front, despite the fact that 41% of the largest public enterprises are in the red. Out of a net worth of US$110 billion, only US$570 million worth of shares have been put for sale and of this only US$17 million effectively sold. Even these have been bought by other public companies. On the other hand, some signs of a renewed interest in foreign investment could be seen in November, when vice president Davoudi invited foreign companied to explore opportunities in the mining sector. In the meanwhile the stock exchange continues to lose ground, not least because of Ahmadinejad's lack of worry about the prospect of economic sanctions. 

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