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Mon, Sep 24, 2007
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Iran
Fuel Rations
Arab Competitiveness
A Grim Reality
Immigrants Target Money-Transfer Industry

Iran
Fuel Rations
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Extra rations for various government organizations, groups of individuals with special needs and some businesses, as well as a bonus 100 liters Ôsummer traveling rationÕ have reversed the initial drop in consumption.
Two months after the government of President Mahmoud Ahmadinejad began rationing petrol to curb consumption, critics say the plan has failed to cut down gasoline consumption. Instead it has hurt the agriculture, tourism, transportation and other sectors of the economy.
Rationing did push consumption down by around 15 million liters a day. But where the average daily consumption stood at around 77 million liters, in the first three months prior to rationing, the first two months following rationing saw it drop to 61 million liters, according to a report published by the Fars news agency. Demand is expected to rise considerably from late September when schools reopen.
Extra rations for various government organizations, groups of individuals with special needs and some businesses, as well as a bonus 100 liters ’summer traveling ration’ have reversed the initial drop in consumption. Gasoline consumers under different categories are now receiving additional gasoline rations, a member of Parliament Economic Committee was quoted by the ’Aftab Yazd’ daily as saying.
“During the early stages of the implementation of the plan, traffic was reduced, gasoline consumption went down, there was less pollution and people accepted to learn to change their fuel consumption patterns. But creation of extra rations has destroyed all the initial achievements,“ the ’Jomhouri Eslami’ daily wrote.
Traffic in the capital that had reduced by 15 percent in the early stages of the implementation of the gasoline rationing plan has bounced back to where it was, according to the traffic department of Tehran municipality. Tehran is home to nearly one-seventh of the Iranian population and accounts for a third of all the cars in the country.
One undesirable outcome of rationing is the creation of a huge black market for ration cards. Rations for private cars, taxis and pick-up trucks and even those of the government-owned cars can be purchased in the black market. The problem has pushed the government to consider revising taxi allocations, the interim oil minister was quoted by Oil and Energy Information Network (SHANA) as saying.
Companies whose businesses need transportation facilities are also picking up rations allotted to taxis, pick-up trucks and old cars.
“Our company needed gasoline for our technicians to make their service rounds around the country. Work almost stopped during the first couple of weeks. Buying a few old taxi and pick-up trucks has solved our problem to some extent because their gasoline ration is several times more than that of ordinary cars,“ the owner of a servicing company told Ipsnews.net.
Gasoline has for many years been sold at highly subsidized prices in Iran, at least five times cheaper than in some neighboring countries. The price differences made the smuggling of gasoline from Iran to other countries hugely profitable and millions of liters of gasoline were smuggled out daily. It is still sold at one-fifth of its real price but rationing has almost stopped the smuggling of gasoline, authorities say.
Iranian refineries have limited capacity to produce gasoline, and before rationing began the country had to import around 20 million liters of gasoline a day. Consumption has grown nearly 10 percent annually and before rationing began daily consumption sometimes topped the 80 million liters mark.
Iran imported $5.4 billion worth of gasoline last fiscal year (March 21, 2006-March 20, 2007). The budget law for the current fiscal year allows the government to import $2.5 billion worth of gasoline. The figure is based on an average consumption level of 60 million liters a day. There will, however, be a gasoline import budget deficiency of $1.5-$2 billion dollars for the rest of the current fiscal year due to the three month delay in implementation of the rationing plan.
The country’s Fourth Five-Year Economic Development Plan stipulates that government raise the price of oil products to regional wholesale prices within the five years from the beginning of its implementation, i.e., until 2010. The previous government was stopped from implementing the law when the newly-elected parliament voted for stabilization of prices, including that of gasoline.
In its budget for the current fiscal year the parliament, however, reversed its earlier insistence to keep gasoline prices unchanged and obliged the government to ration gasoline, increase its price, offer additional gasoline at market prices and improve public transportation.
“The government resisted implementation of the law for nearly three months and when it finally gave in, decided to implement rationing only. The government is still refusing to sell additional gasoline at free market prices and government cars are now using rationed gasoline (300 liters a month) at rationed price, whereas the law says that the government itself must pay for its gasoline consumption at free market prices,“ an observer in Tehran told IPS on the condition of anonymity.
The legislation already requires the government to complement rationed gasoline with free market price gasoline. In the face of the government’s resistance, parliament is planning to pass a law to force the government to provide non-rationed gasoline at free market price, a member of the Parliament Energy Committee was quoted by Aftab news as saying.
Using alternatives to petrol such as compressed natural gas (CNG) and liquefied petroleum gas (LPG) are seen as one way to cut down gasoline consumption. The government has decided to convert all vehicles used by the government to dual fuel within three months, the Mehr news agency reported.
Owners of private cars are also encouraged to get their cars converted--but there are problems even here.
“The government is encouraging people to convert their cars to dual fuel without having built enough stations. CNG and LPG stations are very few and there are always very long queues in front of the stations. I can fuel my car with LPG but the time I waste in queues to refuel the car is so much I prefer to use gasoline although it is much more expensive,“ a Tehran resident who owns a dual fuel car told IPS.

Arab Competitiveness
A Grim Reality
New Arab Advisors’ analysis reveals massive gap between the Arab countries and the industrial nations in terms of the online reporting on financial performance and social involvement.
A newly released report from Arab Advisors Group focuses on the Arab world’s attempt to catch up on the global trend of using the corporate website to report transparently on corporate performance and economic Corporate Social Responsibility (CSR) issues. Arab Advisors Group’s Online Transparency Index analyzes the status of the biggest 50 companies by market capitalization in the Persian Gulf, Egypt, Lebanon and Jordan.
According to Business.maktoob.com, the comparative analysis of the corporate websites of the 50 biggest companies in the Arab world was concluded by the Arab Advisors Group on August 31, 2007.
The report, titled The Arab World Online Transparency Index 2007 (OTI), ranks the 48 companies out of the 50 on their performance in two dimensions (two of the 50 did not have fully operational web sites at the time of the analysis): website usability and website content.
The usability analysis covers such issues as website logistics, use of interactive elements, converging media and Web 2.0 technologies. The content analysis focuses on the reporting and transparency of economic performance (such as the annual and quarterly reports, corporate history and outlook) and on economic Corporate Social Responsibility issues (such as corporate governance and business ethics).
The analysis provides a valuable first look at the usability of corporate websites and at the online reporting and transparency of corporate performance in the Arab world. The OTI 2007 consists of 50 companies coming from 9 Arab countries (Bahrain, Egypt, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, and the United Arab Emirates).
The market capitalization of each individual national stock exchange (totaling $726 billion for the Arab world) is used as a weight factor to determine that country’s representation among the 50 companies in the Index. The report provides statistical analysis of the results and insightful detailed cross tabulations and can be purchased from the Arab Advisors Group for only $2,000.
The overall results reveal a grim situation when considering the global competitiveness of the Arab world. The research shows that there is still a huge gap between the leading Arab nations and the rest of the world in terms of the online reporting on financial performance and social involvement.
With this research, Arab Advisors Group clearly establishes the need for the Arab corporate world to recognize the growing importance of online transparency. With national Internet penetration rates rising, national stakeholders will start to look towards corporate websites for their information much more often.
Also, if the Arab world truly wants to be a globally competitive region, the quality of the corporate online presence should be improved drastically.
Furthermore, it is also recommended that companies and governments make an effort to standardize CSR reporting in the Arab world, and that they should make their websites more user friendly, user orientated and interactive.
“When we look at the individual company level, the UAE real estate company Emaar Properties ranked high in the index. Emaar is very closely followed by Kuwait’s Mobile Telecommunications Company. Out of the 50 companies in the Index, only 21 received a satisfactory score of 50 percent or above.“ Sander Hofman Arab Advisors research analyst wrote in the report.
“The results per country show that Egyptian companies score highest both in the usability and content dimension, while being trailed by boomers Qatar and UAE. Stunningly, the economic heavyweights in the analysis, Saudi Arabia and Kuwait, perform the worst in both dimensions. Looking to the difference between regions, it is interesting that the Levant outperforms the Persian Gulf Cooperation Council in both dimensions.“

Immigrants Target Money-Transfer Industry
US immigrant groups are ratcheting up a boycott of Western Union Co. in hopes of forcing the global money-transfer industry to do good for its customers’ families, not just do well for itself.
According to AP, foreign workers complain that wire-transfer firms set extortionate fees and exchange rates, and that the industry fails to reinvest in the very communities from which it profits. Western Union is being targeted for its size: It is the biggest player in the United States and ranks among the largest in the world.
“We choose to stand up for our right to live in dignity and fight for our families,“ said Francis Calpotura, executive director at the Transnational Institute for Grassroots Research and Action, or TIGRA. The network of 158 immigrant groups is spearheading the boycott, begun last week in California and slated for nationwide expansion starting on Monday.
Immigrant workers in the United States send home some $70 billion in earnings a year and the firms handling this trade skim more than $14 billion a year, mainly in transaction fees, market analysts say.
Remittances from foreign workers around the world amounted to around $250 billion last year and the figure is increasing by nearly one-third a year, according to the World Bank.
Western Union, spun off from US-based First Data Corp. in September 2006, is a 4.5-billion-dollar business. Migrant workers say the company owes its success to them and they mean to cash in.
“Western Union makes billions from Mexicans and they give us pennies. It’s time for Western Union to reinvest meaningfully in our communities,“ said a representative of the Oaxaquena Federation who declined to be named.
The company countered that it could not have attracted so much business had it charged uncompetitive fees.
Additionally, the Colorado-based firm announced late last week that it would give away $50 million in educational and economic charity over the next five years. It said its “Our World, Our Family“ initiative would channel the money through the philanthropic Western Union Foundation and through Mercy Corps, a US-based international aid group.
Protest leaders said they would press on with their boycott. “The new initiative merely re-packages its Western Union’s current giving program,“ TIGRA said in a statement. “It fails to address the campaign’s key demands.“
Our World, Our Family would raise Western Union’s overall philanthropic spending to 49 cents of every $100 in profit, up from 41 cents, according to TIGRA. It compared this with $2.30 for every $100 of profit for leading retailer Wal-Mart and $7.50 for ice cream maker Ben and Jerry’s, a unit of Unilever.
Protesters said they would pressure Western Union to increase its charity and to give directly to groups working with immigrant communities. Mercy Corps, they said, lacked experience of working with such communities in the United States. Boycott organizers also want the company and its subsidiaries, Vigo and Orlandi Valuta, to reduce their transaction fees and set more favorable exchange rates.
In many poor countries, remittances from workers overseas exceed international aid.
Remittances to Latin America and the Caribbean surpassed $60 billion in 2006 and about three-fourths of this came from workers in the United States, according to the Inter-American Development Bank (IDB). This money exceeded foreign direct investment and official aid combined and, in six of the region’s countries, accounted for more than 10 percent of national income.
The largest recipients of remittances are Asian countries, including India (about $26 billion a year), China ($23 billion), and the Philippines ($14 billion).
The flows are so large that development lenders--the IDB in the western hemisphere and the Asian Development Bank to the east--and the governments of countries receiving remittances are seeking ways to lower transaction costs and channel more remitted money into investment projects.
The transaction costs of money transfers often exceed 20 percent, researchers have said, adding that reducing these costs by even a few percentage points could yield savings of billions of dollars a year for workers sending money home.