Iran’s early offer of unilateral trade incentives to the European Union during the trade cooperation negotiations, and the possibility that the Europeans might ask for more before assisting Iran to join the World Trade Organization (WTO), has caused great concern among Iranian officials and economic experts.
They argue that offering early incentives to Europe is not in the best interests of the country, because it could have a negative impact on the bid to join the WTO in the future.
On the other hand, after six rounds of negotiations, the Europeans emphasized on Iran’s unilateral reduction of tariffs, the transparency of government purchases and privatization of a great part of the service industry, reported ISNA.
Iran’s Ministry of Foreign Affairs is in charge of monitoring trade relations with Europe. Many officials from different ministries have given their opinion in respect to Iran-Europe trade talks.
Hamed Rohani, deputy head of International Affairs at Iran’s Trade Office in the WTO, is of the opinion that both sides should receive equal incentives as per the agreements reached at the Trade Cooperation Agreement negotiations in Paris.
Likewise, Esfandiar Omid-Bakhsh, plenipotentiary representative to the WTO, also said the way the European Union reacted with regards to the tariffs is similar to the way it reacts to other WTO members.
He said the subject of TCA negotiations and Iran’s joining the WTO are not two separate issues, “because Europe asked Iran to abide by the regulations of the WTO during the TCA negotiations, therefore, the TCA is a gate way for Iran to enter the WTO.“
As the official suggests, Iranian negotiators are trying “to welcome the WTO before starting the negotiations.“ However, other WTO member countries did the opposite and gave no incentives before joining.
At the end of the sixth round of negotiations held in Paris on March 17, 2005, both sides exchanged documents that could be a new opportunity for Iran to get access to the European market.
After the negotiations the demands of the European side became more open. Thus it is necessary for the Iranian ministries to work together and prepare themselves for the next round in the forthcoming month in order to protect national interests within the framework of economic relations with Europe.
Iran-Europe trade negotiations started two years ago but with no positive results. However, after the Paris agreement, the negotiators returned to the table once again. The first talks, some time ago, concluded without any significant results and even though the TCA negotiations are only on trade relations, the European Union directed the talks towards Iran’s policies. The Iranian side asked the Europeans to support their bid to join the WTO and also get the support of the United States as a pre-condition to restart the negotiations.
Rohani is of the opinion that the TCA negotiations should offer equal incentives for both sides without being unilateral.

TEHRAN, April 27--Oil Minister Bijan Namdar Zanganeh said the world oil market is not faced with a shortage of supply, stressing that the market might even be experiencing an oversupply at the moment.
According to ISNA, Zanganeh told reporters in Port of Spain, Trinidad and Tobago, where he is attending a natural gas exporters conference with fellow Organization of the Petroleum Exporting Countries (OPEC) oil ministers from the UAE and Qatar, that he thought the ’market is well supplied and may be oversupplied’ despite crude prices hovering well over $50 per barrel.
Reuters reported earlier that Saudi Arabia’s Crown Prince Abdullah, the de facto leader of OPEC’s top producer, met on Monday with US President George W. Bush in Texas to discuss oil prices, which are up about 25 percent since the start of the year.
After the meeting, Adel Al-Jubeir, a foreign affairs adviser to the crown prince, said world oil supplies were adequate, but the kingdom was willing to provide more crude quickly.
Crude supplies in the United States, the world’s largest energy consumer, are near three-year highs as OPEC has boosted production, according to US government data.
As remarks by Iranian minister that the market is well supplied made headlines, the Saudi kingdom once again upset fellow OPEC countries by showing that it is ready to sacrifice their interests to satisfy the superpower.
Zanganeh had said earlier the world oil market should not expect the organization to do everything they wish. However the Saudi billionaires seem to disagree completely with him.

Minister of Industries and Mines Es'haq Jahangiri inaugurates an Iran-Turkey joint industrial unit in northwestern city of Tabriz on April 26. (IRNA Photo)

TABRIZ,
East Azarbaijan,
April 27--Minister of Industries and Mines Es’haq Jahangiri here on Wednesday inaugurated a multimillion dollar joint venture with Turkey to produce industrial bags in this northwestern city.
The factory has been built in an area of 5.7 hectares at an investment of seven million dollars over a year.
According to IRNA, the Turkish side provided 50 percent of the funds while the remainder was allocated from the Foreign Exchange Reserve Fund.
Some 250 people are officially employed in the factory.
The unit is expected to export $6 million worth of industrial bags a year.
The minister said at the inauguration ceremony that the industrial and mining sectors have managed to absorb some 95 percent of the foreign investments made in Iran over the past couple of years.
Jahangiri said the key to progress in achieving economic development lies in foreign investments.
He further noted that one of the greatest achievements of the Foreign Exchange Reserve Fund in recent years is that it helped expedite implementation of development projects, cutting the duration from five years to 2.5 years for each project.
Jahangiri said the Khatami administration has tried to facilitate foreign investments, stressing that the ministry has given top priority to joint ventures in high-tech industries.
He called on the government to render greater support to the development of high-tech industries in view of the high investment risks involved in the relevant projects.
The minister also called for partnership with foreign companies as part of efforts to acquire modern technologies. “We enjoy enormous natural resources but need to develop modern technologies,“ he observed.

Decline in international cotton prices has encouraged imports in recent months.

TEHRAN, April 27--A senior cotton industry official said here on Wednesday that some 30,000 tons of cotton were imported from the Central Asian countries in the year to March 2005.
Mohammad Hossein Kaviani, managing director of Iran Cotton Fund, told Mehr news agency that foreign companies charge textile factories far less than the national cotton industry, which is why the textile units have embarked on excessive imports.
The official said cotton imports would seriously harm the national cotton industry, stressing that the problem would lead to a decline in domestic production. He predicted that some 20,000 tons of processed cotton would be delivered to the textile factories in the years to March 2006. Experts believe that cotton imports have created chaos in the market, stressing that as a result, domestic producers have failed to sell 200,000 tons of products.
The decline in international cotton prices has encouraged imports in recent months. Experts say the government must make it clear whether it prefers national production or import of cotton as many farmers have already shown unwillingness to continue the business.

LONDON, April 27--Pakistan and its neighbors will be able to decide by 2006 which of the three competing trans-national gas pipelines should go ahead first, Pakistan-based newspaper Daily Times quoted Ministry of Petroleum and Natural Resources Secretary Ahmad Waqar as saying on Tuesday.
“Roughly within a year, maybe in the beginning of next year, we should be able to decide which pipeline is feasible,“ said Waqar during a road show to lure investors to 20 oil and gas blocks. Pakistan and India, which depend on imported oil and gas, are considering three gas pipeline projects, from Turkmenistan, Iran and Qatar, which are often called ’pipedreams’ because of delays caused by security concerns.
The pipelines on the drawing board since the early 1990s are expected to run through Pakistan into the giant market of neighboring India and a recent thaw in bilateral relations has encouraged hopes the projects will finally be able to proceed.
“We expect these pipelines to be laid by the time we are faced with shortages around 2010-2011,“ Waqar said, adding that by that time Pakistan’s energy demand/supply gap could be as large as 20 million tons of oil equivalent a year.
The country, which projects economic growth of seven percent this year, currently produces 3.5 billion cubic feet of natural gas per day, meeting just 50 percent of its needs.
Waqar said that Pakistan would also decide on liquefied natural gas (LNG) imports in the fourth quarter of this year, with Qatar emerging like the most likely source.
“It could be Oman, it could be Yemen, but the most likely candidate appears to be Qatar,“ he said.

TEHRAN, April 27--Iran has for the first time signed an aircraft export agreement with a foreign company, announced the managing director of Iran Aircraft Industries Company here on Wednesday.
Hamid Sabbaghi told Mehr news agency that the company signed a contract with an Australian firm to export 50 two-seater aircraft to that country over a five-year period.
He did not mention the name of the Australian company, but said the Iranian aircraft is called, Ava-202.
The official said that in view of the deal with the Australian side, the company has no plans for domestic sales of the aircraft for the time being.
He said feasibility studies on the project to build the two-seater aircraft began in 1995 and led to the company obtaining relevant permits from Civil Aviation Organization, which is Iran’s top aviation body.
Sabbaghi said each Ava-202 costs about one billion rials to build.
Iran has tried hard in the past 10 years to build airplanes with the help of former Soviet republics, especially Ukraine.
Iran and Ukraine agreed late last year to step up the production of Antonov-140 passenger planes, which is manufactured here under the name of Iran-140.
Iran has produced three Iran-140 airplanes and this figure will increase to 80 planes by 2020.
According to Ukrainian experts, the production line of a new Iran-140 model for domestic flights and mountainous areas will be launched in Isfahan.
They believe Iran-140 is equipped with state-of-the-art technology with warning systems.
Iran can sell these airplanes to South Asian countries in the near future. Iran and Ukraine signed a treaty for the production of Iran-140 planes in Isfahan in 1995.

Samand exports have taken center stage in Iran's lethargic auto industry.

TEHRAN, April 27--A lawmaker said here on Wednesday that the possible export of Iran’s national car, Samand, to China could serve as a stepping stone for Iranian industries to enter the global market, stressing that producing cars in a country known for its incredibly low production costs is no easy task.
In a report faxed to Iran Daily by Iran Khodro Public Relations Office, Mohammad Hassan Estaki, a member of the Majlis Industries and Mines Commission, said that the national car industry should take customers’ preferences into consideration and called for more appropriate after-sale services.
The auto giant Iran Khodro signed the joint investment agreement with a Chinese car maker on April 24. Iran Khodro, also the Middle East’s largest auto manufacturer, said it would have a 30 percent stake in the $60 million joint venture with Youngman Automobile Group to build the Samand production saloon in Jinhua, Zhejiang province.
Production is due to start in 2007 with an initial annual output capacity of 30,000 units in the first phase.
The deal was signed on the sidelines of the 11th International Auto Show in Shanghai.
Iran Khodro has also signed a contract with Syria to export the Samand to that country.
Samand exports have taken center stage in Iran’s lethargic auto industry, which has largely failed to win customers’ satisfaction at home.
Many experts believe that the fresh wave of car imports which began earlier this year following the government’s decision to cut tariffs from 130 to 100 percent would kill the appetite for Iran-assembled cars. Peugeot 206 remains the most popular car ever assembled in Iran, while the Samand has not yet managed to win customers at home, which is probably why the company is looking to international markets.

TEHRAN, April 27--Head of the Tehran Stock Exchange (TSE) announced Wednesday that the bylaw authorizing purchase of up to 10 percent of TSE-listed companies’ shares by foreign parties will be approved by the cabinet in the next few days, stressing that foreign investors will not be allowed to take the principal capital out of the stock market for three years.
Hossein Abdeh-Tabrizi said at the inauguration ceremony of Kish Stock Exchange that the country’s stock market is moving toward industrialization, adding that the foreign investment bylaw is the very first step.
“It would make not any sense to resist the internationalization of the stock market,“ he said, adding that foreign investors could operate on Kish island with much less difficulty because of the easy business regulations.
Experts believe that the capital market would need 1,000 more brokerage firms if it were to ensure adequate growth. However, some old hands at the stock market consider it against their interest to have new brokerage firms.
Growing economic indices show the stock market would experience a boost in transactions in the year to March 2006.
Transactions are expected to increase by 10-fold in the next five years.