Overview: Iran Analysis Weekly Report August 14, 2016
Aug., 2016
Vistar Business Monitor
Vice President for Legal Affairs Majid Ansari called for the Judiciary to investigate “recent insults” against President Hassan Rouhani amid an increasingly hostile domestic political environment. Ansari attributed the “unprecedented affronts” in Iranian politics to the upcoming presidential elections in May 2017. Tehran Prosecutor-General Abbas Jafari Dolatabadi similarly stated on August 7 that “insults, spreading lies, and printing falsities” against officials are crimes. Rouhani has come under increasing criticism for America’s perceived lackluster implementation of the nuclear deal, including from a Friday prayer leader who recently called him “Mr. Gullible” for believing Iran would benefit from the deal.
President Hassan Rouhani called for an investigation into former President Mahmoud Ahmadinejad’s “neglect” in failing to recover nearly $2 billion in assets before the U.S. seized the funds in 2008. Rouhani said the Judiciary, the Supreme National Security Council, the Judiciary, and other “relevant institutions” should scrutinize Ahmadinejad’s failure to use a ten-month period between 2007 and 2008 to recover the assets. Rouhani and Ahmadinejad have previously accused one another of contributing to America’s seizure of Iran’s frozen assets.
The Interior Ministry announced finalized registration and campaigning dates for the 2017 presidential elections.
The registration period will be held from April 11 to April 15, 2017, according to the Interior Ministry. Candidates must then undergo an extensive vetting process. Those who are approved to run will have one week to campaign from April 28 to May 17. Election Day itself will be held on May 19, a month earlier than usual to avoid overlapping with the fasting month of Ramadan.
On the foreign affairs note, Foreign Minister Mohammad Javad Zarif and Turkish Foreign Minister Mevlüt Çavusoglu pledged to strengthen cooperation between Tehran and Ankara on the Syrian conflict. During a joint news conference in Ankara, Foreign Minister Mohammad Javad Zarif acknowledged “differences in opinion” between Iran and Turkey on Syria but claimed that “important views are shared” between the two countries, including the need to “maintain Syria’s territorial integrity” and the requirement that “the Syrian people must decide their own future.” Turkish Foreign Minister Mevlüt Çavusoglu vowed that Iran and Turkey will “strengthen” cooperation “for the establishment of a lasting peace in Syria.” Zarif also welcomed the planned restoration of diplomatic and economic relations between Russia and Turkey following the meeting between Turkish President Recep Tayyip Erdogan and Russian President Vladimir Putin in Russia on August 9.
On the economic note, the producer price index (PPI) of the industry sector in first quarter of Persian calendar year increased by 0.2 percent in comparison with previous quarter. Also, whole industry’s producer inflation has been 0.5 percent negative.
The number of home sales in the current fiscal year (started March 20) has been on the rise. According to official statistics, some 36,900 homes were sold in Tehran during the three months ending June 20, showing a growth of 5.6% compared with the same period of last year. This latest uptick comes on the heels of other positive trends that have recently stirred hope of a housing recovery after a long and painful recession. An earlier CBI report in May showed a 20.4% month-on-month rise in home sales during the month that ended on April 19.
Banks doled out 934 trillion rials ($30 billion at market exchange rate) to various economic sectors in the three months ending June 20, with the industry and mining sector grabbing 30% of the total. The banking sector’s Q1 lending report, published by the Central Bank of Iran on Tuesday, marks a year-on-year growth of 44.1% in business lending.
The report indicates that 632.8 trillion rials ($20.3 billion) or 67.8% of the loans were allocated for meeting businesses’ need for working capital. Injection of working capital accounted for 88.7% of the total loans paid to industrial units and mines.
Head of Management and Planning Organization, Mohammad Baqer Nobakht announced that 66 foreign direct investment projects worth $5.16 billion are being implemented after the nuclear agreement (Joint Comprehensive Plan of Action) came into effect in January in the areas of transportation, renewable energy, tourism, recycling, electronic industries, food, and machinery.
Over the past few weeks, the Iranian government approved the draft of the country’s new format of oil contract named Iran Petroleum Contract (IPC). The process to prepare the IPC took almost two years.
After climbing for six consecutive weeks, the benchmark indicator of Tehran Stock Market saw deceleration last week. In the week leading to Saturday, August 10, 2016, the TEDPIX increased by 307 units to record a growth rate of 0.4 percent. This occurred after the key index entered the 78,000 channel. The TEDPIX grew 2 percent a week earlier.
To subscribe the VBM Iran Analysis Report please visit http://vistarbm.com/Subscribe.aspx or send an email to contact@vistarbm.com.