September 14, 2008

Minister Denies Government Responsible for Price Hike – Iran Daily

Text of unattributed report headlined "Commerce minister requests closed Majlis session to discuss inflation" published by Iranian newspaper Siyasat-e Ruz on 8 September

The minister of commerce requested the Majlis presidium to hold a closed session where he can explain and describe the factors causing price hike and inflation.

Mas'ud Mir-Kazemi appeared on the Majlis floor in an open session to answer Tehran MPs Elyas Naderan, Parviz Soruri and Alireza Zakani on the price rise in certain commodities, the government's wheat imports, the decision to cut subsidy on detergent powders and the chaotic state of the market. The commerce minister pointed out the global price surge in commodities, the UN resolutions [sanctions] against Iran, increased wages, the liberalization of commodities including petrochemical products and the psychological effects of the rumoured liberalization of commodities such as diesel fuel as the main reasons for the surge in the prices of a number of basic commodities. On the lack of market supervision, Mir-Kazemi said, under the fourth economic development plan, the State Inspectorate [as received] Organization was dissolved and the number of inspectors has dropped from 8,000 in 1383 [2004-05] to 800 and any increase in that number is not allowed. He continued, this year, we employed 4,000 inspectors with the help of guilds and as a result, we had a 25 per cent increase in the cases investigated this year and the violating companies were fined 300bn tumans.

About the price rise of rice, Mir-Kazemi said the global price surge and the three-fold rise of transport costs have raised the price of rice in our country, despite the reduced import tariff. The minister said detergent powder subsidy was cut due to shortage of funds so we could pay subsidies on basic commodities such as wheat and added that the detergent powder market is stable now. He said that the subsidy on detergent powder was [cross] allocated to milk and about the rise in milk price, he said, milk production cost has nearly doubled since last year but the consumer price has increased slightly. About the 60 per cent increase in import tariff on mobile telephones, he said tariffs on mobile telephone and 1,100 other consumer commodities were increased in 1385 [2006-07]. He said the import tariff on mobile telephones was reduced to 25 per cent the next year because the manufacturers did not fulfil their commitment and were unsuccessful.

Having heard Mir-Kazemi's explanations, the MPs were not convinced and referred the questions to the appropriate committee for further examination.

Talking to reporters, the minister of commerce rejected the claimed price hikes in the month of Ramadan and said, the only increase was in the price of poultry and it is dropping now. [When] asked why prices rose in Ramadan, he said that such talks provoke the market and the only price rise we had was in poultry 15 days before Ramadan and nothing else and even the price of rice is dropping. Mir-Kazemi urged the media not to provoke the market with such reports and cause price hikes. He said: "The high inflation rate and the surge in the prices of certain commodities is a different issue and has nothing to do with price hikes in Ramadan."

Originally published by Siyasat-e Ruz, Tehran, in Persian 08 Sep 08.

(c) 2008 BBC Monitoring Middle East. Provided by ProQuest LLC. All rights Reserved.