Currency printing costs Iran around $15 million: official

Business Materials 12 December 2012 15:09 (UTC +04:00)

Azerbaijan, Baku, Dec. 12/ Trend G.Mehdi/

Currency printing in Iran costs around 180 billion rials (about $15 million), ILNA quoted Mohammad-Ali Mahmoudzadeh, Melli Bank's director for informatics as saying.

The figure has been estimated excluding other related side expenses, he added.

There are 114 bank notes for each person in the country, he added.
As inflation erodes the rial's purchasing power, Iran's central bank must increase the supply of money which risks hyperinflation, a cycle of rising prices and rising volumes of money in circulation. Denying the bank's ability to increase the supply of money would theoretically hasten an economic crisis.
Three foreign currency printing companies have decided to discontinue their businesses in Iran, UANI (United Against Nuclear Iran U.S. group), Communications Director Nathan Carleton told Trend.

Earlier this month, UANI launched an Iran Rial Currency Printing Campaign which targeted companies that print Rial for the Islamic Republic.

According to Nathan Carleton, three such companies have stopped their businesses there as a result of UANI's campaign.

"All three of the firms we contacted, KBA, Flint and DLR, have informed us that they are no longer involved in currency printing in Iran," Carleton said, noting that UANI applauds the companies for their decisions.

KBA of Germany is the world's second largest security banknote printing press manufacturer and has sold printing presses to numerous Iranian bodies.

Flint, an ink and chemical supplier based in Luxemburg, worked in Iran through SunColour Inks Co., and held the patent for a trademarked family of banknote printing products repeatedly requested by the Central Bank of Iran.

UANI has also contacted DLR, a British firm whose machines have printed rials for the regime in the past for clarification about any current ties to Iran.

"UANI is currently investigating what other companies might have taken their places and are prepared to pressure them as well," Carleton noted.

The U.S. dollar cost some 24,500 rials in the last week of September and went sky-high to 37,000 rials on October 2 and 40,000 rials on October 3.

As a result of such jumps in rates, tensions arose in Tehran, as earlier local Iranian sources indicated police arrested some 30 people who might have been involved in currency manipulations on Iran's free markets.

Yesterday on Oct. 19, the U.S. dollar was sold for 33,500 rials on Iran's free markets.

Nathan Carleton noted that no one should be helping the Iranian regime print more currency during this critical time.

"We will continue to observe the rial's value, but we do not expect it to improve unless the regime changes course."

Carleton also added that according to some sources, traders in other countries such as Afghanistan are not even interested trading the rial anymore, due to its instability.

Iran is currently facing a crippling currency crisis, aside from the pressuring international sanctions, a new portion of which has been put on the country several days ago by the EU.

The sanctions aim to stop Iran from making a nuclear weapon, yet Iran denies all accusations noting that country's nuclear programme is only for peaceful purposes.