WORLD BANK GROUP
INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT
INTERNATIONAL FINANCE CORPORATION
INTERNATIONAL DEVELOPMENT ASSOCIATION
INTERNATIONAL CENTRE FOR SETTLEMENT OF INVESTMENT DISPUTES
MULTILATERAL INVESTMENT GUARANTEE AGENCY
INTERNATIONAL MONETARY FUND
September 24–25, 2005
Statement by the Hon. DAVOUD DANESH JA’FARI,
Governor of the Bank for the ISLAMIC REPUBLIC OF IRAN,
at the Joint Annual Discussion
[EXCERPT] Mr. Chairman, Distinguished Governors
Now let me bring to your kind attention the latest developments in my country. The Islamic Republic of Iran has pursued the economic and social and reform strategies within the framework of the country's Development Plans. In this regard a package of reform policies were implemented in the context of the third 5 year development plan during the period of 2000/04 and many considerable and significant results have been achieved.
The Islamic Republic of Iran has the second largest population in MENA region. Most of them are young with increasing expectations of a better life and future. There are also a large number of well – educated women seeking opportunities to partake in different areas of economic and social activities. Despite significant progress in the country’s activities for poverty reduction and human development, creating enough job opportunity to meet the new flows into labor market along with extensive reduction of unemployment is required. In order to overcome this problem, high and sustainable economic growth with enough employment opportunities should be ensured. We strongly believe that economic development can not be achieved unless, attractive investment climate and broader participation of private sector in the economy is provided and promoted. In the same line the strategic policies deduced from the article 44 of the constitution implying the boundaries and areas of performance of state-owned, cooperative and private entities were elaborated and specified by the government. In these new introduced policies, the ground is paved for more private sector involvement in different economic and financial activities, specially in those areas that previously was monopolized by the Government.
Therefore the legislative framework for contribution of the private sector in different areas of activity such as heavy industry, banking, insurance, power supply, communications and transportation sector is provided.
Greater transparency in the macroeconomic regime, budget reforms, tax reforms, unification of foreign exchange rate, downsizing the government's role in economic activities through privatization of SOEs, dismantling of monopolies and promoting competitive market, reducing the non-tariff trade barriers, adopting smart and targeted subsides, attracting foreign investments and protecting private sector investment, establishing private commercial banks to pave the ground for privatization of state-owned banks and developing an effective social security system are the evidence to the Government of Iran's commitment to implement structural reforms within the framework of the third five year Development Plan. These employed reforms and programs together with strong macroeconomic performance, have caused an average t growth rate of around 5.5 percent during the period of the third development plan, which is the one the highest in the region. In addition the unemployment rate is dropping continuously reaching 10.3 percent last year.
By reaching the end of the third development plan in 2004, the fourth five year development plan was ratified six months ago. In fact this Plan in compliance with the objectives set by Twenty Year Economic Vision Document of the country, draw the guidelines and specifies the framework for the new government policies and approaches. Achieving the continuous increasing and sustainable economic growth, providing the ground for the competitiveness of goods and services in local and foreign market, promoting non-oil exports, extending efforts for shifting the growth structure toward the knowledge economy are some of the major highlights of the economic approach of the fourth five year development plan.
I would like to emphasize that while the new government is very much committed, to the said 20 years Economic Vision Document and the Development Plan, one of the most important priority of the government is the issue of expansion of Equity in the society by economic and social means, by providing for example, equal job opportunities, education, health and social activities, in order to reduce the Gini Index . Furthermore, anticorruption campaign will also be implemented more forcefully.
Mr. Chairman, Dear Governors Ladies and Gentlemen
At the end I should express my appreciation to the World Bank management and staff for their extraordinary work and commitment. There is no doubt that in case of my country with a growing portfolio, the dedication and relentless efforts of the Bank's management and staff have played a crucial and significant role. In fact we consider the World Bank as an important center for synthesis of expertise, views and experiences in a global scale to illuminate the development gateway.