Policy of Globalization
Legacy of Privatization

Vice President Mohammad-Reza Aref received his Ph.D. in electronics and telecommunications from Stanford University in 1980. A senior college professor and author, Dr. Aref served for three years as the Minister of Post, Telegraph and Telephone before being appointed as vice president and head of the Management and Planning Organization in 2000. Dr. Aref addressed the first session of IPF on some of the major topics and future plans of Iranian economy.

Petrochemicals by Numbers: Iran will witness a twofold increase in the production capacity of petrochemicals by 2005 when the Third Five-Year Economic Development Plan will end. The country’s industrial sector, whose share in the gross domestic product will increase from 17% in 2000 (start of the Third Plan) to 23.5% in 2005, will itself serve as a huge market for intermediate industrial products, particularly, petrochemicals. Iran’s flourishing petrochemical industry will in turn play a central role in this process.
Iran’s considerable share of oil reserves in the Middle East and the world, 14% and 9%, respectively, and gas reserves, 26% and 16%, respectively, is indicative of the country’s strong will to increase its share of petrochemical production and exports.
In 2000, Iran’s share of petrochemical capacities in the world market was more than 0.5% and plans have been made to boost this figure to more than 2% by 2005.

Opportunities & Achievements: The petrochemical industry in Iran had a remarkable growth in the first and second Development Plans. During the two plans, the government offered its strong support, allocated large financial resources in rials and foreign exchange, and provided tax holidays, and by doing so it prepared the ground for the number of petrochemical complexes to grow by six to 14 and structural reforms be initiated for the privatization of the petrochemical industry. Furthermore, the government has always continued to include in the annual budget acts finance facilities and a guarantee for their repayment by the Central Bank of Iran (CBI) as a means of strengthening NPC’s financial resources. It has taken steps for the exploitation of new oil and gas fields as sources of feed for the petrochemical industry. Exploitation of Iran’s abundant gas resources would considerably diminish the cost of feed for setting up petrochemical industries. The petrochemical industry will hopefully export $2.98 billion by 2005, making up 33.6% of Iran’s non-oil exports.

Privatization & Globalization: The government’s pursuit of the policy of privatization and partnership of the private sector in major industrial investments will contribute to the formation of strong and reliable partnerships for foreign investors. The State Management and Planning Organization, as supervisor of the implementation of development plans, will seriously pursue privatization in the petrochemical industry through offering the shares of the companies involved in this industry on the Tehran Stock Exchange during the Third Plan. The organization considers the Third Iran Petrochemical Forum as a call for participation of domestic and foreign companies in the golden future of the petrochemical industry.