Latest statistics suggest that some 42.2 million shares of state companies have been transferred to private ownership.

After Former Minister of Economic Affairs and Finance Tahmasb Mazaheri was removed from office by President Mohammad Khatami late April, his name also disappeared from newspaper headlines, which he used to make almost on a daily basis during his tenure as minister.
There was no news of Mazaheri until recently when he was invited as a 'special guest' to the 29th Meeting of the Islamic Development Bank.
The Ministry of Economic Affairs and Finance, the Management and Planning Organization (MPO) and the Central Bank of Iran, which many believe used to throw a monkey wrench in the works of each other, were reshuffled in the past months.
Cabinet reshuffle debates began earlier this year and bore fruit after the Seventh Parliament took office. President Khatami, in separate decrees, ended Mazaheri's services and accepted Head of the Management and Planning Organization Mohammad Sattarifar's resignation.
Former Minister of Labor and Social Affairs Safdar Hosseini replaced Mazaheri and Hamid Reza Baradaran-Shoraka took the place of Sattarifar at MPO.
Some say the former economy minister had urged Khatami to dissolve the Commerce Ministry and the MPO a few days before he was removed from office.
The former minister, whose removal from cabinet raised eyebrows leading to speculations he had betrayed the Khatami administration, had proposed in his probably last letter to the president as the economy minister that the MPO and the Commerce Ministry could merge to establish a treasury ministry in order to help reduce the government's enormous executive burden.
Mazaheri also tried to convince the chief executive that the initiative would help prepare the ground for the next government to start its work with a well-shaped economic body.

Ultimate Solution
Mazaheri is of the opinion that the ultimate solution to Iran's economic ailments could be private sector investments in production and job sectors.
In a recent interview with ISNA, the former minister said some believe the state budget should remain as the economic powerhouse and the government must continue to pump money into various economic sectors to improve development goals.
"I advocate the theory that investments and domestic production are the economic powerhouse," he added, stressing that the government's financial and budgeting policies must also be coordinated to this effect.
He expressed hope that the Khatami administration would manage to continue with the policy of supporting private sector investments in the production sector, in the final year of its second and last term.
"Before I was appointed as minister of economic affairs and finance, I had sent a letter to the president explaining the then situation of the national economy and proposing plans for a structural economic reform," he said, adding that the president approved the initiative, which set the ground for the moderate administration's economic reform program.
Mazaheri says most targets set by his proposed program began to be realized during the second term of the Khatami administration.
"My personal assessment is that all of my programs have so far been discussed or implemented," he said, adding that his major plans included amendment to the taxation law as well as the capital market and the money laundering bills.

Key Factor
Asked how much he thinks his economic programs have been successful, the former minister told ISNA that the people must judge the performance of officials.
"Coordination among the government's executive bodies, particularly the economic team, is a must," he said, adding that wherever there was coordination, greater success has been achieved.
"For instance, had there been poor coordination among officials, we would not have been able to set a single parity rate for foreign currency or remove barriers to promoting non-oil exports," he said.
Mazaheri stressed that the prevailing disharmony between financial and budgeting policies remains to be the main barrier to implementing the structural economic reform plan.
"In the third plan, private sector has been referred to as the country's economic development powerhouse, which means the government must distance itself from all activities that can be undertaken by private companies," he said, adding that the third plan had stipulated that the government must only supervise the implementation of economic projects.
Mazaheri says there is another thinking, which insists on the need to have all economic affairs controlled by the government given the poor status of private sector in Iran.
"They believe that state funds must be injected into economic projects," he said, adding that the two viewpoints have now clashed with each other.

Disagreement
Latest statistics released by the State Privatization Organization suggest that some 42.2 million shares of state companies have been transferred to private ownership in the first six months of the current year (started March). Figures made available to Iran Daily by the organization confirm shares transferred in the period were worth 422 billion rials.
Some 17 companies affiliated to the SPO as well as 28 affiliates of other major state enterprises have been privatized since March as stipulated in the Third Five-Year Development Plan (2000-2005).
All the shares offered in the period were ceded to private ownership via the stock market.
But in spite of the comparative success in privatizing state companies in the face of strong opposition from labor unions and some state managers, the privatization drive has not yet managed to meet targets. One of the main sources of disagreement is over how to spend privatization revenues.
Mazaheri says privatization is one of the main issues on which officials from both sides of the political spectrum are yet to reach a consensus.
"From the point of view of the first group, revenues from privatizing state companies must be invested in economic projects and laborers who lose their jobs in the privatization process must be protected," he said, adding that the second group says privatization revenues must be deposited with the State Treasury and spent by the government.
"Disharmony between these two viewpoints has led to serious challenges in the way of privatization," he said.
Commenting on the high-profile issue of withdrawal from the foreign exchange reserve fund, the former official said the government will need an extra 20 trillion rials in the last quarter of this year, stressing that the initiative would lead to a rise in inflation rate.
"There is no option other than withdrawal from the fund," he said.
Mazaheri now teaches at university - what he used to do before joining the president's economic team. He was head of the powerful Mostazafan and Janbazan Foundation in the late 1980s, when former Prime Minister Mirhossein Mousavi promoted state-controlled economy.

Iran was capable of manufacturing 530,000 cars in 2002, compared to the 206,000-production capacity in 1998.

With the total production of 450,000 cars a year, Iran is ranked the world's 17th auto manufacturer. Iran and Turkey presently are the two largest auto manufacturers in the region.
Estimates show that the process of car production is still surging. Iran was capable of manufacturing 530,000 cars in 2002, compared to the 206,000-production capacity in 1998. The big leap was 430,000 cars in 2000 that declined to 340,000 in 2002.
Experts believe that Iran has many advantages that make it viable as a partner to foreign investors and for establishing joint ventures.
Reliable statistics all point to the fact that today's automobile industry is considered the third largest after food and construction when considering the capital ratio and investment, not to mention that it is the biggest industry from the technological point of view.
From the very start, the auto industry created the maximum job opportunities. The auto-part industry is no exception.
The state Industrial Development and Renovation Organization (IDRO), the main stockholder of Iran's top automakers, has entered partnerships with private investors to launch more sophisticated lines of auto component manufacturing. IDRO is allowed to own up to 30 percent of the ventures' shares and must reinvest its profits for further expansion.

Sole Runners
By the middle of last century, developed countries were sole runners in the field of auto and auto-part manufacturing, and from the beginning, especially since the 1950's the industry experienced an all-out growth in both quality and quantity, making it one of the largest industries in the world.
Following the Second World War, auto-making fever also reached the less developed or developing nations, including our country. Around half a century ago, the automotive industry in Iran was born, in 1957, when an assembly line was set up in Tehran to manufacture Jeep vehicles. During 1960's a large-scale movement began in Iran to assemble various types of cars, buses, and trucks. Companies setting up included Fiat, Iran National, Moratab Industrial Mfg, Iran Kaveh, Zamyad, Mazda, General Motors, American Motors and etc, many of which still operate with the same names, and some manufacturing the same brands over time.
Present Situation
It is estimated that 1 million cars will hit the market this year and the number will increase to 1.5 million units by 2006.
Iran also exports a number of brands and their spare parts worth $150 million to countries such as Syria and Bangladesh.
The parts manufacturing sector has a high capacity to reach out to overseas market.
Iran's auto parts production capability has considerably increased in recent years following a number of joint ventures with leading manufacturers.
Car parts manufacturers recognize that they should keen in constant touch with their foreign rivals so as to promote the quality of their products.
Officials say some 20 billion rials worth of investments are needed to help parts producers keep up with the auto-manufacturing sector.
About 78 percent of the auto industry is directly linked to parts manufacturers and after-sale-services.
To overcome shortcomings and move in tune with global advancements, the industry needs expert planning, investments and installation of quality systems.
Beyond Borders
Joining the international market is an inevitable process for expansion of the auto spare parts industry, which in turn is tied to attraction of sufficient funds, through domestic and foreign investments, and forming joint partnership with leading manufacturers.
Now with more than four decades of experience at hand, experts say Iranian parts producers can take on global markets, at least at the regional level.
Today, more than 80 percent of the country's auto spare parts demand is met through domestic suppliers.
Now with a capital circulation of more than 30,000 billion rials, the sector looks viable for trying a hand in overseas markets.
To assert their role in the highly competitive global market, car and spare parts manufacturers should keep a close eye on global developments and pay more attention to research and innovation. They should constantly opt for improving production quality to international standards and attempt to localize related technology. To this end, the government is expected to give every possible support, through reducing tariffs and extensive financial services, so as to help manufacturers produce at lesser costs, which would automatically bring down the final cost of their products.
Through proper planning and marketing, countries with similar economic conditions such as Turkey and China have managed in recent years to seize lucrative markets beyond their borders.
Despite producing quality brands, low production levels and higher costs are depriving Iranian manufacturers the chance of emerging in markets abroad.
The situation gets more worrisome when considering that Iranian consumers are more inclined towards foreign brands simply because they not only look for high quality products but also those that cost less.

Spare Parts
The spare part making industry needs to catch up with the car making industry in joining the global markets. We need to analyze the current situation of these industries, point out the necessities and present suitable macro strategies in order to join the process of globalization. Competitiveness, sound managerial system, human resources development, internalization of quality system and production standards, after sale services and marketing are considered as some of the prerequisite macro strategies to globalization.
Having Iranian carmakers in global markets will lead parts' manufacturers to the same markets as well. And that's why they need to improve and develop their capabilities in order to be able to face global competition.