Ahmadinejad confers with academics on economic reform plan

TEHRAN, July 7 (MNA) -- President Mahmud Ahmadinejad held talks with over 100 senior Iranian economists on the government’s economic reform plan on Saturday evening.

Last month Ahmadinejad revealed the long-awaited proposal on economic reform which calls for eliminating energy and bread subsidies, delivering funds directly to low-income families, and reforming the customs, tax, and insurance systems.

 

The president said the process of making fundamental reforms to the economy requires nationwide cooperation and urged the economists to stand in solidarity with the administration in the implementation of the reform plan.

 

The Ahmadinejad administration’s economic policy has pushed inflation close to 26 percent by injecting large sums of cash into the economy to fund local infrastructure projects.

 

The economists advised the administration to “spend subsidies in a proper way, slow down the implementation of infrastructure projects, employ highly efficient economic advisors, merge parallel organizations, amend contradictory regulations, tackle financial corruption, and strengthen the private sector” to revitalize the country’s ailing economy.                

 

The president said economics professors and academics will certainly play a leading role in putting the reform plan into operation.

 

He denied allegations that his economic policy is “unscientific and impractical”, saying, “I am committed to the key concepts of economics.”

 

“The government is not taking a short-term view on the reform plan” and is seeking to formulate a comprehensive economic reform plan, the president said in response to a suggestion that the administration should implement only a part of the large project.

 

Ahmadinejad, who is expected to seek reelection next year, also asserted that the plan does not serve any political purpose and is only meant to reform the country’s ailing economy.

 

 Economic talks positive in principle

 

Economics professor Farshad Momeni said on Sunday that the meeting between the president and senior economists was positive in principle.

 

However, “the information which was given to the economists was undeveloped and had just gone a bit beyond the usual generalizations,” he told the Mehr News Agency.

 

“The meeting was arranged to inform the economists about the government’s reform plan. After the president’s address, the economists raised some points in the short time that was given to them,” Momeni stated.

 

In response to the economists’ warnings that granting cash subsidies would seriously harm the economy, Ahmadinejad vowed not to make hasty decisions on the matter, he added.

 

Although the proposal has serious deficiencies, it also has the potential to prevent a national economic disaster, he noted.

 

Momeni said the economists criticized “the government’s imprudent actions under the privatization plan and in the distribution of justice shares.”

 

Justice shares are shares in state-run companies that are being privatized that are reserved especially for low-income and underprivileged citizens. 

 

The president acknowledged the fact that privatization before the private sector is strengthened can never promote economic competition but he did not give any assurances that he would revise the current wrong strategies, he stated.

 

“The economists also said that the government’s economic policy must be based on theoretical principles in order to avoid controversy and contradiction… They also expressed serious concerns over the current non-technical approach to the banking system, which could create serious problems for Iran’s economy,” Momeni added.

 

BA/HG

END

MNA

News Code 28836

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