TEHRAN, Iran, June 22
Trend:
Increase of foreign currency rate will affect Iran's economy, said member of Iran Chamber of Commerce.
Member of Iran Chamber of commerce and Head of Iran Economic House Masoud Daneshmand discussed the recent rise of foreign currency rate in an interview with Trend.
"The rise of US dollar's rate is an official decision and is not based on free market. Forex offices that are related to the Central Bank of Iran choose a price to be considered a base for transactions. Therefore, the market mechanism does not affect the foreign currency rate," Daneshmand said.
"The dollar rate is taken for setting price of euro. In global markets, most supplied goods' prices are based on the US dollar. The price of commodities such as steel, paint, aluminum, wheat, rice, gold and other items increases when the dollar rate rises. It is possible that price of gold in global stock market also increases based on US dollar rate," he said.
"Nobody knows how far the price of the US dollars will increase, and even if the government knows it does not want to say. If the government plans to increase dollar rate to 230,000 rials or 250,000 rials, people will sell properties to buy dollars; however, the problem is that we don't know the future rates. People seek to preserve the value of their money and buy foreign currency, gold, gold coins and cars," he said.
"Iran economy is different compared to Venezuela, Lebanon and Syria. For instance, Lebanon has a small economy with $80 billion foreign debt, while Iran's short- and long-term debt stands at $9 billion. Iran's non-oil export amounts to $40 billion and the $9-billion foreign debt is not significant. Furthermore, there are various financial sources to meet the needs; it is only political decisions that could affect the economy," he added.
"In this situation, I recommend people to be patient and wait. The foundation of economy should be fixed and the focus should be on production, as it will lead to creating jobs and boost economic growth. This way, the inflation can be controlled and the value of national currency will return to its former state," he said adding that the value of national currency will not increase by eliminating zeros on banknotes.
"Only production can fix the economy," he noted.
Foreign currency rates have increased significantly in Iran during recent days; one US dollar costs 190,000 rial, and one euro - 200,000 rials.