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Iran to set up National Development Fund to absorb oil price shocks

TEHRAN, Jan. 25 (Mehr News Agency) - The Iranian government plans to establish a National Development Fund to supplant the Oil Stabilization Fund in a bid to curb shock effects of the global oil price fluctuations on the country's economy, the deputy finance minister said here on Sunday.

"Our economy is dependent on oil (revenues), so the oil price plunge impacts it," Mohammad-Hadi Zahedi-Vafa said, predicting that the oil price will raise in future, the Mehr News Agency reported.

On the impacts of the global financial crisis on Iran's economy and stock market, Zahedi-Vafa said, thanks to the fact that Iran's capital markets are not integrated with international markets the crisis had no direct effect on the country's financial market.

However, with the downing prices of industrial and mineral products in the international level, Iran's stock market will be affected under such circumstances, he noted.

The deputy minister went on to say that the plan to detach Iran's economy from oil revenues has been on the agenda for several years.

The National Development Fund corporate charter and mechanism will be defined based on the Fifth Five-Year Development Plan, he added.

The National Development Fund is to extend financial facilities to private, cooperative and non-governmental sectors in an effort to promote domestic and foreign investment.

Majlis opposes granting cash subsidies: MP

TEHRAN, Jan. 25 (Mehr News Agency) - MP Gholamreza Mesbahi-Moqaddam said on Sunday that the Majlis has refused to approve the Article 13 of the bill on granting cash subsidies to citizens.

The government has submitted an economic reform plan to the Majlis which calls for eliminating energy and bread subsidies, delivering funds directly to low-income families, and reforming the customs, tax, and insurance systems.

Mesbahi-Moqaddam, who chairs the Majlis Economic Committee, said, "In Article 13 the law on national services and law on increasing the minimum salary based on inflation rate have been omitted while, in our opinion, all laws should be implemented."

He rejected remarks by the economy minister that the Majlis and government have agreed on the Article 13.

"Since the generalities of the bill have not yet been approved by the Majlis, we cannot say the government and Majlis have reached an agreement," Mesbahi-Moqaddam told reporters.

He said the discussions between the Majlis and the government have not yet been finalized but the government has agreed with some proposals made by lawmakers.

... Payvand News - 01/25/09 ... --

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