TEHRAN, Dec. 4--The latest resolution by the UN International Atomic Energy Agency's Board of Governors on Iran will help reduce the political risk of investment in the country, a senior official at the Ministry of Economic Affairs and Finance said here on Saturday.
Deputy Minister Mohammad Khazaei told ILNA that Iran's success in preventing the referral of its nuclear dossier to the United Nations Security Council will certainly help improve the country's economic relations with the European Union and create peace of mind for foreign investors.
"If Iran's nuclear case were to be sent to the UNSC, we would surely face difficulty in attracting foreign investments," he said, adding that foreign investors usually avoid political shocks and crises.
The official noted that economic risk of investment is low in Iran and that if the country manages to minimize the political risks, foreign investments will improve accordingly.
"Excluding Tav and TurkCell contracts, we are expecting foreign investments to reach $500 million until March," he said, adding that once the parliament approves the two projects, some $1.7-2 billion would be attracted by the yearend (March 2005).
The Board of Governors of the International Atomic Energy Agency (IAEA) decided earlier this week against referring Iran's nuclear issue to the UN Security Council.
The IAEA resolution came after five days of talks. The United States lobbied to have Iran's case referred to the UNSC.

TEHRAN,
Dec. 4--The National Saffron Committee has been established in the northeastern province of Razavi Khorasan, a provincial official said here on Saturday.
According to ISNA, Hossein Zare-Sefat, Deputy Governor General of Razavi Khorasan for administrative and financial affairs, told reporters that given the strategic importance of saffron production in Khorasan, the committee was established to create the necessary coordination among various state organizations to resolve the problems facing the lucrative industry.
"The committee will help standardize saffron production, support agriculture commodity exchange and improve saffron processing-related activities," he said, adding that with the establishment of this committee, saffron prices are expected to rise in the near future.
Zare-Sefat further said the government is planning to fix saffron prices to prevent them from declining further.
He said that the international seminar on saffron, which was hosted by Spain in recent years, will be held in Mashhad in 2006," he said, adding that Mashhad must become Iran's saffron capital city, in addition to its current status as the spiritual capital of the country thanks to Imam Reza (AS)'s holy shrine.
Experts say Iran's reign in the global 'red gold' production is approaching its end.
The country's saffron production is expected to decline by 60 tons to reach 100 tons in the current year due to drought in saffron producing areas and record low prices of the product on the domestic market.
While the final cost for producing each kilo of saffron is estimated at 2.2 million rials, the product now sells for less than 2.07 million rials, turning the once lucrative industry into an unprofitable business. Each kilo of saffron used to sell for more than 3.5 million rials in 1999.
But prices have dropped drastically in the past two years.

Prices of petrochemical products have remained unchanged for the past four years.

TEHRAN, Dec. 4--An Oil Ministry official said here on Saturday that the wide difference between the prices of petrochemical products in Iran and those on the international markets has led to an increased smuggling of these goods out of the country, adding that the petrochemical industry is required to change its pricing mechanisms.
Deputy Oil Minister for Petrochemical Affairs Mohammad Reza Nematzadeh said at a press conference that prices of petrochemical products have remained unchanged for the past four years. "Despite repeated calls for a price hike, the Economy Council has not authorized the national petrochemical industry to raise the prices of its products," he said.
Prices in Iran, he pointed out, are 50-70 percent below those on the international markets.
The official further said that the national petrochemical market has suffered huge financial losses in recent years due to low prices. Nematzadeh hoped that the proposed seven-percent increase in prices of petrochemicals could help prevent further financial losses to the industry.
He said another important problem is that the government has allocated huge subsidies for petrochemical products. "Subsidies might be good for foodstuff but not for petrochemicals since we have to export petrochemicals to earn more profits," he said, in clear reference to the constitutional restrictions on the export of subsidized goods.
On the parliamentary initiative to investigate petrochemical contracts, the official said the issue has not been seriously followed up in the parliament. "Nevertheless, we would welcome any investigations by the parliament," he said.
The official put Iran's annual petrochemical exports at 1.8 billion tons, stressing that the delay in implementation of major petrochemical projects was due to optimum utilization of domestic production capacities.
"We are very eager to support domestic industries and products," he said, adding that in some projects, it had been much easier and less costly to import a facility rather than construct it domestically.

TEHRAN, Dec. 4--A senior aluminum industry official said here on Saturday that aluminum sales via the Tehran Metal Exchange (TME) have led to a rise in the price of the product to the effect that it is now higher than the international rates.
Hebbatollah Fazeli, managing director of Iran Aluminum Industries Cooperatives Association, told ISNA that while the establishment of TME was a positive development, its state-controlled management system runs contrary to the government's privatization policies.
"For instance, aluminum production and supply in Iran is entirely undertaken by a state company, which means such a product could not be offered on the metal exchange," he said, stressing that this company, which he did not name, can easily influence market prices.
The official further noted that in the absence of a competitor to help reduce aluminum prices, industrialists are forced either to close down their businesses or purchase aluminum at higher prices.
"Even imports cannot help bring aluminum prices down given the high customs duties," he said, adding that members of the association cannot afford to establish a private aluminum manufacturing production company.

GENEVA, Switzerland, Dec.4--The World Trade Organization will vote for the first time at a meeting on December 13 and 14 on requests by Iraq and Afghanistan to join the body as well as a repeated demand by Iran, a statement said on Friday.
According to AFP, the accession requests along with other issues such as a report on the latest round of trade negotiations, will be heard at the next General Council meeting of 148 member states.
Iraq asked for full WTO membership in October, just eight months after having been given observer status, while Afghanistan, which also has observer status, applied to join the WTO in April 2003.
Observer status at the WTO lasts five years and allows countries to get a feel of the organization and rules governing fair trade among members without benefiting from or being bound by them.
At the end of the period an observer can request to become a member, but even then it would face several more years of negotiations with other trading nations before it could join. The question of Iran's accession has been raised at the WTO's General Council meetings since May 2001 and repeatedly rejected by Washington, which broke off diplomatic ties with Tehran after the 1979 seizure of US embassy staff as hostages.
But this time around more countries, including the European Union, voiced their support for Iran and hoped the United States would complete its review.
There had been speculation that some countries would only support Iraq's request for observership if Washington agreed to alter its stance on Iran.

TEHRAN, Dec. 4--A senior Energy Ministry official said here on Saturday that national hydroelectric power generation capacity will reach 5,500 megawatts by the end of President Mohammad Khatami's second and final term in office in mid-2005.
Reza Ardakanian, deputy energy minister for water affairs, told ISNA that under the fourth development plan (2005-2010), the Energy Ministry will have to reduce the use of underground water resources by 25 percent over five years, adding that the move calls for effective mechanisms.
Referring to the recent establishment of the International Center for Qanats and Water Structures in Yazd, central Iran, the official said the United Nations Educational, Scientific and Cultural Organization (UNESCO) had approved the setting up of this center.
The official further noted that normal precipitation has been forecast for this year, expressing hope that southeastern regions of the country would get rid of droughts after seven years.
"At present, we have no major problems with water supply and the most important thing we would demand from the public is lower consumption," he said, adding that 15 large dams would become operational in the current Iranian year (to end in March).
"These dams are located in 15 provinces with two dam-building projects expected to be completed in Yazd province," he said, adding that the giant Friendship Dam will also become operational in a ceremony attended by Iranian and Turkmen presidents in the coming months.