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Iran to privatize 65 percent of state-owned firms

Tehran, Nov 28, IRNA -- The Expediency Council (EC) in a directive on Saturday approved the ceding of over 65 percent of shares of state-owned firms to the private and cooperative sectors, the EC public relations department reported.

The decision comes on the hills of a prior ruling by the arbitrative body to delineate comprehensive policies pertaining to the Article 44 of the constitution which covers expansion of non-state sectors via privatizing state-owned and affiliated organs.

"The EC said the transfer of 65 percent of shares of public companies will only include large industries, and mines."

The defense and security-related industries, National Iranian Oil Company (NIOC) and affiliated firms are excluded from the directive.

The article 44 identifies the domain of the state sector as all large industries and mines, foreign trade, banking, insurance, energy generation, dams and large irrigation networks, radio and television, post, telegraph and Telephone, airlines, shipping, railroads and others which have a public ownership and/or are state-affiliated.

The directive also underscores the importance of the government role in expanding economic infrastructure and strengthening of its monitoring and guidance capacity over the national economy, notably in oil and gas, water, electricity, railroads, telecommunication, pharmaceuticals sectors as well as regarding military and security affairs.

It however, highlights the importance of the private sector development through ceding state-owned companies.

The directive also lists as priorities: raising productivity and efficiency in the economy, creating infrastructure for socio-economic development and widening of the ownership among the public based on fairness, social justice and strengthening the national economy.

In late October, The Expediency Council announced new decisions to implement the privatization drive and ceding economic affairs to the private sector.

So far, the Expediency Council made public its decision to revise articles 43 and 44 of the Constitution which had called for monopoly of the state over economic affairs.

The Management and Planning Organization (MPO) has drawn up a 20-year strategy for economic, social and cultural development which is implementable only through privatization.

The Supreme Leader of the Islamic Revolution Ayatollah Ali Khamenei forwarded the 20-year perspective to the three branches of the government to take effect from 2005 to 2025.

The Expediency Council assigned the government to adopt transparent mechanisms for ceding economic affairs to the public citing the stock exchange mechanism in order to, what the body said, 'provide the public with equal opportunity'.

"Shares of the big enterprises should be ceded to the public through the stock exchange and the cooperatives enjoy preference to the private sector," the Expediency Council said.

The proceeds coming from the sale of the enterprises should be deposited in the State Treasury to be channeled to the infrastructural projects, the top decision making body said.

... Payvand News - 11/28/04 ... --

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