Iranian Contractors May Receive Loans From Public Funds, Says Zanganeh

VOL. XLV

No 27

8-July-2002

IRAN

Iranian Contractors May Receive Loans From Public Funds, Says Zanganeh

Iran’s Oil Minister Bijan Zanganeh announced at a Tehran conference on 30 June that Iranian contractors working on oil ministry projects may qualify to receive loans from the government’s foreign currency reserve, in order to fund work programs. The official news agency IRNA quoted Mr Zanganeh as saying: “A proposal is being studied to provide funds to Iranian contractors from the public sector. If approved, they will receive loans from the special foreign currency reserve fund on guarantees from respective employers.” He added that financial support for companies affiliated to public sector organizations would help stimulate the economy.

The announcement marks the latest in a series of moves by Tehran to boost Iran’s domestic capabilities and reduce reliance on outside expertise. Recent changes to Iran’s Foreign Investment Law require international companies investing in Iran to ensure a 51% contribution by local companies (MEES, 3 June), and in recent buyback and conventional contract awards, the National Iranian Oil Company (NIOC) has insisted that international contractors include Iranian firms as partners in joint ventures to undertake projects. NIOC even went so far as to cut BHP Billiton out of the long-awaited Foroozan/Esfandiar oilfield development project, awarding the deal in the end to Iranian firm Pedco alone (MEES, 27 May). On a smaller scale, Mr Zanganeh recently announced a move to prevent imports of oilfield equipment, if it were available at a cheaper price from domestic firms (MEES, 29 April).