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IRAN


 

 

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
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)

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Update No: 062 - (25/01/07)

Sanctions are coming
Sanctions against Iran were finally approved by the UN Security Council on 23 December. The resolution bans exports to Iran of parts and material that could
contribute to Iran's atomic or missile programs. The foreign assets of some Iranian agencies and individuals will also be frozen as they are alleged to be involved in the program. Moreover, further measures might follow if Teheran fails to stop the enrichment of uranium and to fully cooperate with UN inspectors. The first Iranian reaction was to imply that the program would now accelerate in response to the sanctions and that a 'breakthrough' will be announced in February in the occasion of the anniversary of the 1979 revolution. In fact the Iranian parliament immediately approved a bill asking the government to revise its policy of cooperation with the IAEA in response to the vote of the Security Council. 

Sanctions, China and the oil industry
During December for the first time Iranian officials admitted that they are having problems in attracting the necessary level of foreign investment to their oil industry. Recognising that foreign banks and financial companies have decreased their cooperation, Oil Ministry officials also hinted that they expect China to fill the gap at least in part. In fact, the China National Offshore Oil Corporation already signed a memorandum for the exploitation of the North Pars gas fields, which if finalised would bring US$16 billion of investment to Iran. Since the Chinese are certainly hungry for oil and gas, their growing interest in Iran might well offset the declining interest of western investors, who are being further put off by the approval of sanctions by the UN Security Council, however mild those sanctions might be. Sources within the Iranian Oil ministry also hinted the existence of plans to draw the much needed cash to be invested in the oil and gas industry from the Oil Stabilisation fund, which was originally intended to balance the ups and downs of oil and gas prices by accumulating reserves during the good years and spending them when prices hit a low. Some experts however believe that neither the Chinese nor the Oil Stabilisation fund will suffice and that indeed Iran has already been reducing its production for the last two years, producing even less than its OPEC quota would allow. Another negative aspect for Iran's oil and gas industry is that its bad management is seriously harming its credibility abroad. In early January the Iranians suspended their gas supplies to Turkey, due to a harsh winter and consequent rise in internal consumption. By privileging internal consumption and by over-committing to external buyers, the Iranians showed a fair deal of incompetence and disorganisation. 

Ahmadinejad's sunset boulevard?
The final results of the 15 December elections were released. In Teheran, the most closely observed of the local councils, the supporters of anti-Ahmadinejad conservative leader Qalibaf elected 6 out of 15 councillors, the reformists four and Ahmadinejad's supporters three. With regard to the Council of Experts, all the leading vote winners were conservatives, but mostly not close to Ahmadinejad. This led many observers to announce the inexorable decline of the President, but this might be premature. The number of votes obtained by his supporters seems in line with Ahmadinejad's level of support before the second round of the presidential elections, where only two candidates were present. The reformists claim to have elected 40% of the councillors nationwide, with many others who run as independent and were also elected, but these estimates were not confirmed independently. In any case, the reformists are clearly recovering, but their success was in part due to the unification of the their lists at a time when the conservatives were split in different groups, more then to a proportional increase in votes.

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