Workers say they have suffered heavily from the privatization process.

TEHRAN, June 5--A senior Labor House official said here on Sunday that the privatization trend has led to job cuts, stressing that employment and industries using outdated machinery would be destroyed once the unprepared national economy joins the World Trade Organization (WTO).
Asghar Boreshan, executive head of Labor House, told ISNA that the workers have suffered heavily from privatization, stressing that the process has not been followed by greater state support for the workforce.
On the prospects of Iran’s WTO entry, the official said a section of the officialdom believes that WTO entry is inevitable while another section is opposed to this.
Former minister of economic affairs and finance said last week it would take Iran at least three to four years to gain full membership of the World Trade Organization.
Tahmasb Mazaheri said it is quite unlikely for Iran to manage to complete the procedures any sooner.
Experts believe that most of the existing economic and trade laws will have to change following the organization’s decision to begin accession talks.
It would no longer be possible to set high customs tariffs on imported goods and taxes on exports as the country prepares to join global trade.
The World Trade Organization agreed last month to begin accession talks with Iran after the US dropped its long-standing veto.
Iran applied to join the WTO in September 1996 and its candidacy was first considered in May 2001. However the US had blocked the start of membership talks since then.

TEHRAN, June 5--An economic expert said here on Sunday that political and social reforms have to precede economic reforms in Iran, stressing that, otherwise, the country is unlikely to reap the benefits of WTO membership.
Morteza Afqah, a university instructor and director general of Social Security and Welfare Council’s Secretariat, told ILNA that challenges to Iran’s WTO entry at this juncture are not limited to economic ailments.
“A decade and a half have elapsed since the (1980-1988) war (with Saddam Hussein’s Iraq) ended and we have achieved a number of successes in our efforts to reform the economic structures É But (we have ignored the very fact that) the country needs political and social reforms as well,“ he said, adding that if political and social reforms are not carried out, economic reforms would eventually get nowhere.
The university professor further noted that the main problem with economic analysts in Iran is that they treat economic, political and social matters independently.
He said growing political differences has led to an increase in production costs, adding that the country’s political environment is not yet prepared for a large-scale improvement in the production sector.

Wheat cultivation in Iran is economical given the low production costs.

TEHRAN, June 5--The government has failed to fulfill its obligations to purchase surplus wheat production in several parts of the country putting the much-publicized wheat self-sufficiency at stake.
Massoud Tashakkori, who heads Markazi Province Rural Cooperatives Organization, told ISNA that the government had earmarked 25 trillion rials for the purchase of wheat from farmers, but it has failed to provide more than 19 trillion rials.
The official further noted that there are 137 wheat purchase centers across the province, adding that all these centers are faced with severe shortage of funds.
“The government has to do something about the situation (of guaranteed wheat purchase) so that farmers in the temperate zones would not face serious problems (in the next crop year),“ he said, stressing that the organization is also faced with a serious shortage of workforce at present.
The government, in a bid to attain self-sufficiency in wheat, encouraged farmers across the country to cultivate wheat and assured them the product would be purchased at a reasonable price. However, it has failed to keep its promises only two years after the country announced self-sufficiency and even some officials talked of wheat exports.
This is while there were no problems supplying funds for wheat imports in the past, when the country was the world’s top importer.
The official in charge of implementing the much-publicized Wheat Self-Sufficiency Program said earlier that the government was ready to pay for wheat imports before but it is now facing financial problems in supporting the self-sufficiency drive.
Now that the country has attained self-sufficiency in wheat, acute financial challenges have been created in the way of efforts to continue the successful trend, he added.
Some 6.4 million hectares are under wheat cultivation in the current crop year. Some 2.5 million hectares are under irrigated farming.
Commerce Ministry says the budget for wheat subsidies would face a deficit of four trillion rials in the year to March 2006, adding that the government would most probably not be able to purchase the entire stock from farmers during the period.
Experts say it will be difficult to maintain wheat self-sufficiency drive under the circumstances, stressing that the government must support wheat production and act prudently in this respect.
Annual wheat production target has been set at 18 million tons. Experts believe that wheat cultivation in Iran is economical given the low production costs.

TEHRAN, June 5--Iran’s OPEC governor said Sunday the surplus oil production of 800,000 barrels per day by the member-states of the Organization of Petroleum Exporting Countries would have little impact on stemming the rise in oil prices given the increase in demand for light crude.
Hossein Kazempour-Ardebili, who is also a senior advisor to the oil minister, told Fars news agency that the demand for light crude is rapidly growing in US and Europe as the vacation season approaches.
He further noted that prices will continue to go up despite the higher supply, adding that OPEC could not help change this course.
The increase in OPEC oil supply would only ’lead to further gap between prices of light and heavy crude’, he observed.
Kazempour-Ardebili rejected that OPEC member-states show little cooperation with the world oil market.
The official said earlier increased supply would prove to be uneconomical for member-states.
He said Iran believes that more care has to be exercised in increasing supply of crude by OPEC.
“We would like to reiterate that OPEC member-states have to remain committed to their quota,“ he said, adding that an increase in supply would lead to a rise in heavy crude inventories and a decline in the OPEC member-states’ oil revenues in the long-run.
Crude oil futures jumped back above $54 a barrel Friday, following a brief cool-down in prices after a US government report showed swelling stockpiles in crude and other fuels.
Light, sweet crude for July delivery was up 47 cents to $54.10 a barrel on the New York Mercantile Exchange by afternoon in Europe. It had settled at $53.63 per barrel Thursday after rallying to $55.40 a barrel early in the session.
Heating oil traded at $1.548 a gallon while unleaded gas rose to $1.523--both up less than a penny.
In London, Brent crude was fetching $53.05 on the International Petroleum Exchange, up 65 cents.

TEHRAN, June 5--A senior oil industry official said here on Sunday that Iran and India will sign an agreement on the development of Jofeir oilfield in southern Iran during the upcoming visit to Tehran of Indian Petroleum Minister Mani Shankar Aiyar.
Seyyed Mehdi Hosseini, vice-chairman of the National Iranian Oil Company (NIOC), told Fars news agency that preliminary talks on the groundbreaking agreement have reached concrete results.
“The (possibility of) signing this agreement with the Indian side is very strong,“ he said, adding that the agreement would be based on the buyback mode.
Hosseini said Iran would meet India’s demand in the 2.5-million-ton LNG market for 25 years in return for the agreement on Jofeir.
He said the Indians would also take 20 percent stakes of the Yadavaran oilfield under the same agreement.
The field, in which the Chinese are seeking a 51-percent stake in its development project, has the capacity to produce 300,000 barrels of crude per day.
The Chinese have already submitted the result of their technical studies on the Yadavaran to the Iranian side.
India had been offered a stake in the development project for one of the three oilfields of Yadavaran, Jofeir or North Azadegan in return for long-term import of liquefied natural gas from Iran.
The Indians have made it clear that they are willing to purchase LNG from Iran on the same conditions as in their contract with Qatar which specifies that the price of gas should remain unchanged in the first five years of the contract.
The hydrocarbon resource-rich Iran is already exporting natural gas to Turkey via pipeline. Ankara’s tireless efforts in the past few years to reduce the price have so far met with strong opposition from the Iranian side.

Iran has officially denied it is in talks with the collapsed British carmaker MG Rover's administrators on a possible takeover by Iranian firms.

TEHRAN, June 5--Britain’s collapsed carmaker MG Rover is reportedly planning to export 2,000 cars to Iran, said ISNA here on Sunday.
The news agency further stated that the company’s agent in Iran is to import 2,000 MG Rover cars that have failed to win customers in Europe.
Such speculations come amid reports that Deputy Commerce Minister Mojtaba Khosrowtaj has said a UK company is planning to export cars to Iran without naming the British company.
Iran has officially denied it is in talks with the collapsed British carmaker MG Rover’s administrators on a possible takeover by Iranian firms. The Ministry of Industries and Mines has expressed its opposition to any such move.
Iran’s largest carmaker Iran Khodro has also rejected reports it is planning to purchase the collapsed firm’s rights in partnership with Saipa, which is the second largest Iranian auto manufacturer.
This is while a senior industrial official said last month that the Iranian automotive industry is studying the potentials for cooperation with the UK’s last largest carmaker MG Rover, stressing, however, that the ongoing studies have not yet reached any concrete result.
Reza Veisseh, who heads the Industrial Development and Renovation Organization (IDRO), said Iranian carmakers would not make any decision on possible cooperation with the British company until they complete their studies.

Steel consumption in the country jumped from 5.7 million tons in 1998 to 12.2 million tons in 2004.

TEHRAN, June 5--Iran ranked 21st in the world in the production of raw steel in 2004, said Fars news agency quoting the latest report by the International Iron and Steel Institute (IISI).
The 2005 IISI report put Iran’s raw steel production at 7.9 million tons in 2003, which it said went up by almost 10 percent to reach 8.7 million tons in 2004.
In 2003, Iran also ranked 21st in the world steel industry.
World steel production also increased from 969 million tons in 2003 to 1,056 million tons in 2004. China, Japan and the United States were the world’s top three steel producing countries, respectively, last year.
Raw steel production reached 272 million tons in China, 112 million tons in Japan and 98 million tons in the US.
Iran also imported 8.1 million tons of raw steel in 2004, said the same IISL report.
It added that Iran is the fifth largest steel importing country in the world after China, the United States, Taiwan and Thailand.
Japan with 33.7 million tons is the largest steel exporting country in the world, followed by Russia (32.3 million tons) and Ukraine (26.6 million tons).
Iran’s steel consumption has jumped from 5.7 million tons in 1998 to 12.2 million tons in 2004, showing an increase of 115 percent.