Tehran, Iran, May 18
By Mehdi Sepahvand - Trend:
Iranian Minister of Economy Ali Tayyeb Nia says the present administration has received many economical afflictions from the time before it came to office.
Tayyeb Nia said the government owes about $31.5 billion to the country's banks.
He made the statement in a meeting with leaders and officials of Iran's economy sector in Tehran, Fars news agency reported May 18.
"Last year banks gave worth about $120 billion facilities, 60-70 percent of which is moratorium. They tell us to collect them. The debtors are mainly economy activists and if we take action, they will say the government is hindering business," Tayyeb Nia said.
He also said that the previous presidential administration funded the Mehr housing project by issuing banknotes. "The equal of the whole history of Iran banknotes were issued for the project," he stated.
The government could not continue the project because it would have had to issue more banknotes, which are responsible for the problems we already have, he said.
Iran's Deputy Housing Minister Hamed Mazaherian had said January 7 that the completion of the Mehr Housing Plan is the government's top priority.
Based the plan, 2.3 million residential units should be built. Some 1.674 million units have been so far built, of which 1.252 million have been transferred to owners, he explained.
The Mehr Housing Project was approved in 2004 during the incumbency of former president Mahmoud Ahmadinejad. It had envisaged building 50,000 units per year for low-income people.
Under the Mehr plan, real estate developers are offered free parcels of land in return for building cheap, residential units for first-time buyers, who receive 99-year mortgages for the purchase of the land.
Iranian President Hassan Rouhani has said that the Mehr Housing Project caused 45 percent inflation in Iran. However, the administration is inevitable and obliged to complete the project because the people's trust should not be damaged, he said.
Sixty-two companies went bankrupt following the Edalat (equity) Shares, he said in another part of his speech.
"On the other side, we face some illegal financial institutes which have started operating without any authorization," he said.
"One of the institutes has about one billion dollars in deposit. Why would the Central Bank or the government have to be responsible for its departments?" the economy minister asked rhetorically.
There are over 1,000 trillion rials (over $35 billion) outstanding debts without any collateral in the country.
The Central Bank of Iran in late 2013 disallowed those who owe over 2 trillion rials (about $80,000 based on the dollar/rial ratio at that time) to the national banking system to exit the country.
A December report by the Central Bank of Iran said that bank deposits in Iran hit 7,810 trillion rials (approximately $270 billion).
The total domestic and foreign-currency deposits added up to 7,809.82 trillion rials for that time. As legal deposits were deducted and the deposits were laid by the Central Bank, about 6.94 trillion rials stayed with the banks.
Edited by CN
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