Overview: Iran Analysis Weekly Report July 03, 2016
03 July, 2016
Vistar Business Monitor
Iranian officials condemned the terrorist attack at Istanbul’s Ataturk Airport, where one Iranian was killed, and five wounded. A Member of Parliament’s National Security and Foreign Policy Committee criticized Turkish foreign policy and “support for terrorists” as contributing to the attacks, stating, “The Turkish regime turned its own cities, including Istanbul, into the center of terrorists’ strategy.”
Supreme Leader Ayatollah Ali Khamenei appointed IRGC Major General Mohammad Bagheri as the new chief of the Armed Forces General Staff (AFGS). The former AFGS head, Major General Hassan Firouzabadi, was appointed as a senior advisor to the Supreme Leader. He had served as chief of staff since 1989. The AFGS head is the highest military official in Iran after the Supreme Leader. The AFGS is tasked with coordinating the activities of the IRGC and Iran’s conventional military, the Artesh. Bagheri served as the AFGS Intelligence and Operations deputy and has been embedded within the IRGC’s leadership network since the Iran-Iraq War.
Supreme Leader Ayatollah Ali Khamenei urged the Judiciary to investigate instances of Iran’s “violated rights in connection to sanctions,” including the U.S. Supreme Court’s recent ruling permitting the seizure of $2 billion in Iranian frozen assets. Khamenei met with Judiciary officials including Judiciary Head Ayatollah Sadegh Amoli Larijani on June 29. He denounced the Supreme Court ruling as “based on illusionary pretenses and baseless charges” and stated that Iran’s “violated rights… must be investigated by the Judiciary on the international stage.” President Hassan Rouhani announced in mid-June that Iran filed a complaint against the U.S. in the International Court of Justice over the asset seizure.
On the economic note, the Financial Action Task Force decided June 24 in a plenary in South Korea to welcome Iranian promises to improve, calling for a one-year suspension of some restrictions on the country. The FATF’s positive report on Iran comes as the Islamic Republic’s parliament passed an anti-money laundering and anti-financing of terrorism. The law was later approved by the Guardian Council.
According to the latest report by the Central Bank of Iran, the production price index fell to 1.6% year-on-year in Khordad (May 21 – June 20). The report also said that year-on-year inflation in the Iranian month reached 3.8%, the lowest since 25 years ago. In Khordad, the year-on-year inflation rate for the industry sector was minus 1.5%, while the service sector grew by 7.78%.
Inflation reached 9.7% in the Iranian month of Khordad (May 21-June 20), according to the Central Bank’s latest report. The CBI put the inflation rate for the preceding month of Ordibehesht, which ended May 20, at 10.4%. The overall CPI (using 2011 as the base year) stood at 240.9 in Khordad, indicating a 1.2% rise compared with that of the previous month. The index registered a year-on-year increase of 6.8% compared with that of the similar month of last year. Although the inflation rate is a single digit now after a long time, the monthly inflation increase was more than expected. It was 1.2%, while the administration’s inflationary red line was to be 0.8% only per month. This is the second month that monthly inflation crosses the red line.
According to a report released by Customs Administration, Iran exported 27.78 million tons of goods valued at $10.47 billion at the end of the first quarter. The value of the goods increased by $3.61 billion compared to the first two months of the year, while the weight of the goods rose by 9.66 million tons. In the same quarter, the country imported 7.26 million tons of goods, valued at $9.1 billion. The figures show an increase compared to the first two months of year, when Iran imported 4.56 million tons of goods, valued at $5.49 billion.
The Central Bank of Iran released its latest report on the Tehran Housing Market. The CBI reports shows 15,562 residential units have been sold in the third month of the Iranian Calendar Year (May 14 to June 14, 2016), 0.8% more than one month earlier, and 0.6% lower on a yearly basis. The average price of one square meter of residential space sold in the reported month has been USD 1,202. This shows a price increase of 1.2% on a monthly and 3.5% on a yearly basis.
Iran is preparing to launch the first oil and gas exploration and production tenders under its new Iran Petroleum Contract (IPC). The IPC aims to attract some US$100 billion in foreign energy investment after the lifting of Western sanctions against Tehran. The first round of tenders is scheduled for late July, according to Oil Minister Bijan Namdar Zangadeh, and will be for the exploration of deposits in the south of the country. Zangadeh also said that the aim is to ramp up oil production as soon as possible, for which Iran needs “technology and management more than finances and this is why we have drafted new contracts.”
To subscribe the VBM Iran Analysis Report please visit http://vistarbm.com/Subscribe.aspx or send an email to contact@vistarbm.com.