Electricity, General, Foreign Investment, Non-Oil Export Items

Electricity

The electricity industry is yet another significant sector of Iran’s economic activity. Today, Iran is self-sufficient in electrical energy. Furthermore, there are a good number of 2,000 mega-watt power .stations, as well as the atomic power plant of Bushehr, presently under construction, or near completion, and once these power plants begin operation, the country will have surplus electrical energy.

General

Thus, using great humal7 resources and the large able labor force, a wide selection of raw materials and mineral resources, and sufficient energy, which together constitute a strong infra structure basis for industry, Iran has made accomplishments beyond the aspirations of the First and Second Plans.
Iran’s mineral resources provide ores that allow production of: steel and aluminum; a large variety of structural and / or decorative construction stones; cement in abundance; etc.

The construction industry is rapidly expanding and making progress with modern technological developments.

Elections and vocational training is another area in which much work has been done. Vocational and technical training, pre-university, Bachelor’s, Master’s and Ph D courses are developing rapidly and provide qualified personnel for the economy and the society. Technical schools, colleges of science and technology, large and small workshops and factories widely spread over the country, are experimenting with new technical training courses for preparing skilled workers.

The distribution of industrial activities across the country is largely uneven; some parts of the country lack industrial activity which means far fewer jobs in these regions.

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In comparison with other parts of Iran, the province of Tehran has very advanced infra structure facilities and investments; and so employment opportunities in this province are extensive .

As regards value added, and industrial bases, it is by far the most advanced region of Iran. Between 37 and 45% of all jobs ( ie the number of filled positions), and 41 to 46Yo of value added is produced in the province of Tehran.

The province of Isfahan comes next: 10 to 13~0 of jobs and 5 to 12% of value added of the country belongs to this province.

Khuzistan, which was once, one of the most industrially advanced and socially developed areas of Iran, suffered greatly in the war with Iraq and has lost much of its industrial importance.

The province of Zanlan which is situated at 120 km from Tehran, has gained a strong industrial position and has developed very well indeed.
The shares of the rest of the provinces, of the number of jobs and the value added, Ructuate between 4.4and 6.2%.

The reason why some regions are more advanced industrially than others must be the establishment of industrial units which in turn have been the results of geographic, climatic and demographic states of the regions.

industry

Major industries include:
Isfahan Steel Mill and Mobarakeh Steel Mill in Isfahan; Machinery Manufacturing Plant (Machine-Sazi) in Tabriz; Machiinery Manufacturing Plant in Arak; petrochemical, steel rolling and foundry factories in Khuzistan; electric and electronic manufacturinl: units in Fars; cement production in most provinces: Iran’s industries are extensive in these regions, yet in some regions eg the province of Sistan-and-Baluchestan there is hardly an industry .

For industrial development, Iran has attached special importance to employment generation, securing domestic needs, proper use of domestic resources, presence in world markets and earning foreign exchange through increase in value added.

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The general policy of the Iranian government is to free it self from dependence on oil as the single most important export item, and to increase export of other goods and commodities – the so-called non-oil exports. This has led to a great deal of effort to be put into the expansion of industrial capacities, modernization and improvement of the existing industries including and specially agriculture, and better efficiency, so that Iranian export products may compete in world markets  both as regards quality and price. Already a large number of Iranian products have found excellent markets abroad and are accepted as quality products worldwide, including such items as: processed, preserved and frozen foods, clothing and textiles, household goods, electric products especially cables, and of course the traditional products tie carpets, dried fruits and nuts, handicrafts etc).

Iran’s geo-economic situation is unique: it lies at the “center of the world,” between the East and the West; and now, the huge markets in the north (which halt opened up since the collapse of the USSR), and international markets and waters in the south, (the Persian Gulf having become a most significant trading center of the world), offer greater opportunities.
Persistent presence in world markets and international trade fairs, extensive trade cooperation of the

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private and public sectors in marketing across the world, and expansion of Iranian trade zones, have resulted in the growth of non-oil exports. Iran is regularly holding trade fairs in various parts of the world and has so far organized excellent fairs in many parts of Africa, in Canada, Latin American countries, in countries south-east of Asia, the Commonwealth of Independent States, the ex-Soviet republics north of the country etc, etc.

The country’s ten-year program for expansion of non-oil exports has incited and motivated its industrial units both as regards quality standards and cost-efficiency. These industrial units are growing,s can be seen from statistics: the number of “workshops” with more than 50 employees is fast growing which indicates that investments are on the rise, employment is improving and the country’s value added is expanding.

Industry is gaining momentum and playing a larger and larger part in the nation’s Gross Domestic product; the most important industries being as follows:

1- Foods and Beverages
One of the most successful sectors of the Iranian industries is that of the processed foods. The quality of the product and the appearance of the packs, cans, boxes, bottles etc, is constantly improving.

In 1994 alone 38 and in 1995, a further 34 food processing industrial units began operation.

There are about 74,000 people employed in the food and beverage industry which creates a value added amount of 349 billion rials.

2- Textiles, Clothing and Leatherware
Iran has a very long history and tradition of textiles, as well as the basis for a textiles industry: ie the mentality, and acceptance by the people of textile making as a respectable business; and also the raw materials. Therefore, this is a very prosperous economic sector in the country,employing about people, just in factories with more than 50 workers. There are also a large number of small workshops all over the country producing excellent hand-made fabrics, specially of silk. It is estimated that people working in such workshops are about 400-$50 thousand.

The production of textiles in Iran provides 500 billion rials of value added each year. In the recent years Iranian textiles have improved a great deal gaining larger and larger shares of the world market. They meet the highest standards of durability, design and permanency of color. In 1994, 37 new textile projects went into operation.

3-Paper, Cardboard and Printing Industry
This economic sector produces a large selection of products, such as notebooks, disposable dishware, envelopes, paper and pulp, food packing labels and packs (boxes, bags, etc)…

The most important production units in this sector, specially for paper production, are to be found in Khuzistan and Gilan. But there are a large number of workshops and printing houses which use paper and cardboard to produce packaging materials. There are about 14,000 people working in the largescale factories of this sector and it is estimated that twice this number are engaged in the workshops and smaller factories.

This sector produces 70 billion rials of value added eachyear.

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4- Wood and Wood Products
The largest of factories for wood and wood products are situated in Tehran, Gilan and Mazandaran. But there are numerous small-scale factories or workshops scattered all around the country. The sector employs 10,000 people and produces each year about 46 billion rials of value added.

5- Chemical Products
The three provinces of Khuzestan, Pars and Tsfahan, have always had the largest production capacities of the chemical sector. Recently, however, large-scale petrochemical projects have been set up in the Central Province and East Azerbaijan province, and the related industries have consequently grown in these regions. Iran is now one of the largest producers of petrochemical and related products in the Middle East and Middle Asia. It is an established exporter elf certain petrochemical products to world markets.

petrochemical plants in Tehran and Zanjan produce finished products and the raw material requirements of these plants are supplied by other parts of Iran, or they are imported.

Almost 55,000 Iranians are employed in this industry which produces about 330 billion rials of value added.

In 1994 and 1945, respectively 17 and 18 petrochemical complexes went into production.

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6- Non-Metal Minerals
In recent years exploitation of Iran’s mines has played a significant role in the development of a few other industries, particularly that of cement production Many enormous cement production plants are being built most of which shall begin production in 1996. This promises great future achievements in the construction industry, and in exports. Cement; decorative construction stones such as marble; gypsum; certain bricks etc are the main mineral-based products that will remarkably boost Iran’s construction industry.

The non-metal mining industry providesjobs for about 56 thousand people.
Seventeen projects with a total production capacity of 11 million tons a year, are built pointing to a

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bright future.
During the years 1994-1995, respectively, 29 and 21 projects were completed and began production.

7- Metal Industry.
Production of metals, specially steel, copper and aluminum, is an important strategic policy that Iran follows seriously. The nature of production methods dictates that such plants should be erected where abundant energy is available.
The provinces of Khuzistan and Isfahan and the Greater Tehran provide respectively 28%, 25% and 21.1% of the total annual value added of this sector. About 56000 people are employed in this sector. Eight projects have been completed within the last few years with a production capacity of 20000 tons a year.

8- Machinery, Equipment and Automotives.

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The First Social and Economic Development Plan of Iran implemented its program for the production of machinery and equipment with great success, such that its programs have become a model for future developments.

The Second Plan continued the development of these industries: the present manufacturing plants producing various machinery such as earth moving machinery, agricultural machinery and automotives etc which are all being expanded.

In addition many more industrial plants are envisaged or are being built for the production of the automotives.

Iran presently assembles: Nassim, Saba, and Peugeot cars, and is building another automobile manufacturing plant in the province of Kerman. Paykan has been made in Iran since many years ago and has proved to be a reliable car.

In 1994, about 58000 automotive vehicles (cars, minibuses, buses, pick-up vans, trucks…) were made in Iran, 30% more than the previous year.

Foreign Investments

For the past few years, Iran has been trying to attract foreign investments and has made the necessary provisions both as regards to regulations, and as regards assurance and security for investors. During 1995-6, agreements were made far 16 projects with a total investment amount of 355 million dollars.

Fourteen of these projects, with a foreign investment of 352 million dollars have been ratified by the cabinet.

The two other projects, costing 25.3 million dollars, are now being built and will be completed and put into operation soon (1996). Both are “buyback” projects.

Non-Oil Export Items

The total value of export revenues elf the Units under the supervision of the Ministry of Industry has increased from 76 million dollars in 1989, to 740 million dollars in 1994, an average growth of about 58% a year.

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Export products include: biscuits; sweets; clothings; cotton fabrics; shoes; textiles and synthetic fibers; chemical products; tiles and ceramics; aluminium dishware; copper; car radiators; tractors; electrical goods; and industrial kitchens.

The Ministry intends to constantly raise quality standards, improve the appearance, finishing and packaging of the products, expand marketing efforts, continue to participate in all international trade fairs to expand exports and increase every year the quantity and value of goods exported.

From the foregoing it becomes evident that Iran is on the move towards prosperity; its economy is growing fast and will soon catch up with the developed world; education is rapidly improving and spreading; its UN-determined Human Development Index has moved up from 70th to the 66th nation of the world within one year. The Nation is young and strong.

Furthermore, Iran’s doors are today open to the world. It believes in international trade and cooperation.
Welcome To Iran.