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We require a more dynamic role of the joint Iran-Canada Economic
Committee, and consider any unilateral economic action futile: Mr Khamoushi
Considering balance in a certain
period of time, we will see that the element of time will offset all imbalances: Mr
Sadeghi(?)
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A
one-day seminar of 32 Canadian corporate representatives was held at the Iran Chamber of
Commerce, Industries and Mines (ICCIM) headquarters in Tehran. Also present at the meeting
were the Canadian ambassador to Tehran along with a number of officials from ICCIM.
"The presence of high profile figures at the Chamber has promoted its level of
performance beyond a guild's activities, and most of the proposals put forth by its
members, aim to expand relations between the two nations," said Mir Mohammad Sadeghi,
chairman of the Iran-Canada Chamber.
"We hope to see the Iran-Canada Commercial Council act more vigorously compared to
its present level of operation, and capitalise on the provided opportunities to broaden
mutual ties." He added: "we have always believed trade between two nations
compares to a system of two-way traffic, and if we approach it one-way, that is being
solely concerned with the sale of goods to the other, we shall not succeed in expanding
our relations." The Chairman continued by urging the Iran-Canada Chamber, and the
Mutual Commercial and Industrial Council, to act for the development of bilateral and
multilateral relations.
The official drew on the reigning economic situation in Iran to point out that the decline
over the past two years of world oil prices has pressured Iran to pay off its national
short-term debts, and has decreased the nation's bargaining power. Next year, he
estimated, government revenues will drop by 50 percent, thus painting a grim picture of
foreign trade. Some patience and foresight, he assured, will assist in adopting crisis
management methods, in a bid to turn the situation into an agreeable one for long-term
development.
The official foresaw the passage of time offsetting all imbalances and fostering general
equilibrium in mutual relations. "Neither Iran nor Canada are a small country, and
the twentieth century will not mean the end of the world. Let's consider all this a point
of commencement and transform the annual payment of balances into a rational long-term
scheme, befitting present and future world requirements", he said.
He added that the forecast for next year's budget includes buyback deals as a structural
remedy to spur foreign investment in the country. The success of this system however, he
pointed out, depends on the payback of capital yield, beyond a solar year's period.
The official also requested the Canadian trading parties to offer Iran further facilities,
so that the Islamic Republic will be able to keep up its level of trade. He said that all
this is aimed at restoring the financial situation to normalcy, phasing out stagnation,
and stimulating the economy.
According to experts, the Iran-Canada trading potentials stand beyond traditional oil
bargaining, or the purchase of industrial commodities and home appliances. "In the
long term, co-operation between Iran and Canada can expand to a wide spectrum of fields
such as forestry, exploration of new water resources, solar energy, underground resources,
and dozens of other potential fields. Boosted trade, he believed, would help contain the
plight of joblessness which is dogging the two countries.
The Iranian official also called for rational and realistic solutions to remove the
looming financial shortcomings. He suggested the implication of international financial
institutions, or the formation of technically and morally eligible consortiums to help
overcome the monetary problems.
"Such shuttle trips will help create ripe grounds for trade," said Mr Khosrotaj,
deputy minister of Commerce, and chief of the Export Promotion Centre of Iran (EPCI).
"As traders and businessmen, your visit to Iran will help you gain a clearer picture
of our country's potentials and realities, against a backdrop of falsified reports
publicised by the western media," he asserted.
Enjoying high technology, Canada has a free-market economy with a per capital income
larger than that of the US. In the post-World War II era, Canada has transformed from a
rural community to an industrialised nation, boasting remarkable progress in the mining
and service sectors.
Canada's main farm products are wheat, barley, soy beans, tobacco, fruits, vegetables,
dairy products, marine food and forest produce. Iran's exports to Canada comprise of farm
products such as grapes, melons, watermelons, raisins, figs, apples, dates, tomato sauce,
cucumbers, gherkins, garlic, beans, pistachio and jujube, as well as, caviar, hand-woven
carpets, chandeliers, chrome ore, chrome concentrates, and carbon soot.
The deputy minister pointed out that "key to the Iran-Canada trade expansion, is that
Canada not be affected by US pressures on its trade policy ties towards Iran,"
adding: "the Iranian traders should also become familiar with the Canadian market
structure and find ways to attend those forums."
The EPCI chief pointed out that "the first dominating principle for trade ties, is to
make production competitive, and to raise quality. Decisions were taken within the
national restructuring plan over the past year to accomplish this goal". He added,
"chief among such measures were the encouragement of investments in the export
sector, the stimulation of domestic banks, and the conduct export on letters of
credit".
The minister applauded Canada's noticeable headway in the oil, gas, petrochemicals, mining
and foodstuffs, saying they also were the areas of top-priority investment in Iran.
"The government has set in place a range of policies allowing the firms and
ministries to strike joint ventures with foreign partners in such sectors as foodstuffs,
mines, gas and petrochemicals," said Mr Khosrotaj.
Another speaker at the daylong seminar was Mark Corey, managing director of Canada's
Ministry of Industries. "In 1997, Canada-Iran trade stood at one billion dollars,
showing that Iran is one of the largest trading partners of Canada", said the
Canadian official, adding: "bilateral ties are improving but we are looking for
better prospects."
Canada has long been a buyer of Iranian crude oil and in return has sold wheat and
high-tech industrial products to Iran . "The two countries have expanded their
co-operation to telecommunications, communications, geology and mining," said Mr
Corey, declaring,"energy, agriculture, oil and gas, transport and industries are
other potential areas for collaboration."
The Canadian official outlined four major problems with the broadening of mutual ties. One
of the key challenges he considered to be the wide disparity between the two countries'
economic structures. Whereas the private sector takes the lead in Canada, Iran's economy
is predominantly run by the state sector. The second challenge he found to be Iran's
financial situation worsening as a result of sinking oil prices. Yet, the Canadian firms
he pointed out, can make the necessary investments in Iran's oil and gas sector, and help
co-finance such projects. Finally he referred to the need for Canadian traders to increase
their level of information on Iran, while state decision-makers deepen mutual
understandings.
Iran's Chamber president, Ali Naqi Khamoushi was another keynote speaker at the session.
"We seriously demand that the joint economic committee become more active, and
believe any unilateral drive in economic currents will be futile," said Mr Khamoushi.
"While Iran-Canada trade transactions expanded in 1997, Iran's share of imports from
Canada were 11 times higher than its exports to the Northern American state, thus
supplying the dollar from other sources to purchase Canadian services," said the
ICCIM chief. "How long is such a trend going to continue, and is it acceptable that
our trade balance should stand at a ratio of 1 to 11?" asked Mr Khamoushi. Yet he
added that the joint chamber is entrusted with raising the economic balance to a state of
equilibrium. "We do not have the power to narrow down our trade deficit with Canada
through commodity imports, so we are considering other alternatives such as joint
ventures, and the financing of engineering projects in Iran and in third-party
countries".
According to Sigval Dason, chief of the ICCC, "the Iran-Canada Commercial Council
plays a crucial role in the broadening of mutual trade relations. Recent political
developments in Iran, changes in its economic markets, and the opening of opportunities to
foreign businessmen, are the main factors providing assurances for sustained trade ties.
"Iran-Canada trade relations have suffered from imbalances resulting from politics
and the disparities between the two nations' economic infrastructures," said the
Canadian ambassador to Tehran, Michel de Sallaberry. "We have to craft strategies to
settle the problems, and repair our relations based on mutual respect and equality of
rights," he contended. "The imbalance in trade does not play a key part,
therefore we have to spur the entrepreneurs wishing to invest in the two countries'
private sectors", the diplomat suggested. He continued by pointing out that the
representation of 32 Canadian firms in the Tehran Seminar, verifies their interest in
co-operating with Iran's private sector.
The ambassador continued by saying: "Since gas is the driving engine of the Iranian
economy, Canada will co-operate with Iran as a supplier and as an investor in this sector.
So far, Canada has invested 2 billion dollars in this industry". Also, he added that
since the mining sector enjoys high potentials, the Canadian private sector has invested
in some areas of Iran's mineral resources such as zinc, copper and precious stones. He
also said that despite differences between the two countries' mining and transport
sectors, they do bear some commonalties.
Mr. Sallaberry concluded by reminding that any the deepening of mutual co-operation,
without the collaboration of the Canadian banks with Iran's Central Bank and Ministry of
Commerce and Finance, deems impossible.
As final point of interest, at the end of the one day gathering, some specialised working
groups convened sessions to examine the broadening of co-operation in the transport,
telecommunications, energy and, oil and gas sectors.
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