Min. of Economy: Financial shortages grounding business

TEHRAN, Jan. 04 (MNA) – Iran’s minister of economy has said lack of financial resources has grounded the businesses in the country.

Ali Tayyebnia, who was speaking in the first Iranian Economy Conference on Sunday, said that the Revolution of 1979 sought to improve people’s welfare and Iran’s position in international community; “without attaining a satisfactory economic growth rate such achievements will remain largely in theory and on paper; the government has set as its main economic objective attainment of a sustainable growth rate,” Tayyebnia said.

“The growth rate during 3 recent decades contributed positively to improved welfare and created jobs for the youth should have been based on economic efficiency so that fluctuations in oil prices would not have wielded negative and devastating impact on the growth indices,” emphasized Tayyebnia, believing that for attaining a growth rate, “a system of meeting financial needs of the economy is a necessity.”

“This system should manage to channel public savings along with foreign and domestic resources into national economic growth; the financial system in Iran has always faced hurdles, and is now a major impediments in the way toward economic prosperity and growth,” he complained.

“The financial system has seen continuous rise in the amount of liquidity since 1970s, which has roots in increases in the monetary base; the rise in amount of liquidity in across the economy was not born out of the need to meet the demands of the society by the banking system; however, growth in monetary base has caused uncontrolled stellar amounts of liquidity,” Tayyebnia said.

“The banking system has the responsibility to provide short-term financial needs and working capital; however, the capital market could manage provision of long-term financial needs,” said the minister, “the role assigned to capital market to provide financial resources for firms is a major obstacle; through activating secondary market and boom in this market, capital markets would be helped provide the firms’ financial needs,” he proposed.

Tayyebnia cited the lack of financial resources as the major problem pushing the business in the country; “the high liquidity has raised the inflation and production firms face the lack of financial resources; the financial resource now working in the economy has served as a problem and as a conundrum in Iranian economy,” he concluded, with expressing dim hopes that a détente with international community would bring the influx of foreign resources to hard-pressed economy.

By Mehr News Agency

The Iran Project is not responsible for the content of quoted articles.