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RADIO FREE EUROPE/RADIO LIBERTY, PRAGUE, CZECH REPUBLIC
_________________________________________ ____________________
RFE/RL Iran Report
Vol. 8, No. 40, 12 October 2005
A Review of Developments in Iran Prepared by the Regional Specialists
of RFE/RL's Newsline Team
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HEADLINES:
* SYSTEMIC CHANGES COULD WEAKEN ELECTED OFFICIALS, BALANCE
GOVERNMENT
* ARMED FORCES HOLD MANEUVERS IN NORTHWEST
* WOMEN TO DRIVE SCOOTERS AGAIN IN TEHRAN
* TEHRAN AMONG WORST PLACES TO LIVE
* JOURNALIST COMPLAINS OF SHOOT-TO-KILL POLICY
* HUMAN RIGHTS GROUPS DEMAND LAWYER'S FREEDOM
* THREE KURDISH JOURNALISTS INDICTED IN IRAN
* STOCK EXCHANGE HAS LONG-TERM DIFFICULTIES
* IRAN MIGHT RUN OUT OF OIL IN 90 YEARS
* U.S. REITERATES CONCERN FOR IRAN'S PURSUIT OF NUCLEAR WEAPONS
* U.S. URGES RUSSIA TO HALT NUCLEAR EXCHANGE WITH IRAN
* IRAN OPEN TO RESUMING DISCUSSIONS WITH EU
* NEW PRESIDENT'S DIPLOMACY SPARKS CONTROVERSY
* FOREIGN MINISTER VISITS SOUTHERN NEIGHBORS
* IRAQI PRESIDENT: NO IRANIAN INTERFERENCE
* EXPERTS SAY INFRARED BOMBS USED IN IRAQ CANNOT BE HOMEMADE
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SYSTEMIC CHANGES COULD WEAKEN ELECTED OFFICIALS, BALANCE GOVERNMENT.
The formal decision-making apparatus in the Iranian government has
undergone a significant change in the last few days. This change,
which gives the unelected Expediency Council supervisory powers over
the executive, legislative, and judicial branches of government, has
been met with criticism from members of parliament. This development
reduces the power of elected officials, but it could also reflect an
attempt to restore balance to a system heavily dominated by younger
hard-liners.
Enhanced Council Powers
Mohsen Rezai, secretary of the Expediency Council, was quoted
on 2 October by "Sharq" -- as well as "Aftab-i Yazd," "Etemad,"
"Farhang-i Ashti," and "Hemayat" -- as saying that Supreme Leader
Ayatollah Ali Khamenei recently approved the council's oversight
of the system's policies. In other words, he said, the council
will supervise the three branches of government and report on their
performance to the supreme leader.
Rezai said Khamenei wanted the council to perform this
function some eight years earlier, but the necessary laws did not
exist. About one year ago the council began work on the required
statute, under which the heads of the executive, legislative, and
judicial branches must comply with whatever the Expediency Council
says. Khamenei signed off on this about two months ago, according to
Rezai.
"Sharq" cited Expediency Council Chairman Ayatollah Ali-Akbar
Hashemi-Rafsanjani as saying previously that the supreme leader can
delegate some of his responsibilities to others (per Article 110 of
the constitution), and Rezai said this is what is taking place. Rezai
referred specifically to oversight of the system's general
policies, the fourth economic-development plan, and the 20-year plan.
This appears to be a significant enhancement of the
Expediency Council's powers. When the council was created in
February 1988, its primary purpose was to adjudicate in disputes over
legislation between the Guardians Council and the parliament. Soon
after its creation, it began to frame legislation -- something that
ended only after 100 parliamentarians complained to the supreme
leader. According to Article 112 of the Iranian Constitution, the
council advises the supreme leader, and he consults with it when he
wants to revise the constitution.
Fourth Branch?
Some members of parliament were quick to criticize the
granting of new powers to the Expediency Council. Tabriz
parliamentary representative Akbar Alami warned against making the
council a fourth branch of government, "Etemad" and "Farhang-i Ashti"
reported on 3 October. Alami said the legislature has the lead in
national affairs. He cited Articles 6, 56, and 62, which say,
respectively, that national affairs must be administered on the basis
of elections; the people exercise sovereignty based on the separation
of powers; and the people's representatives are elected directly
by secret ballot. Alami also cited Articles 71 and 76, which say the
legislature can establish laws and the legislature has the right to
examine and investigate national affairs. Alami referred to Article
90, which states that an individual can forward a complaint about one
of the branches of government to the legislature, and the legislature
must investigate this complaint.
On the basis of the constitution, therefore, only the
legislature can supervise the legislature, Alami said. "If this
process continues, the principle of national sovereignty and its
representation through the parliament will be exposed to serious
danger," he said.
Another legislator, Reza Talai-Nik of Bahar and Kabudarahang,
said that Article 110 only applies to supervision over the
system's macro-policies, "Etemad" reported. "It is the
responsibility of the Expediency Council to decide to what extent the
country is moving within the context of the macro-policies of the
system and evaluating those policies," he explained. "However, this
does not mean supervision over executive affairs. Supervising the
executive affairs is part of the responsibilities of the legislative
power."
Vehicle For Influence
The Expediency Council, which Hashemi-Rafsanjani has chaired
for approximately 15 years, is a vehicle for his political influence
and power. But some observers believe that Hashemi-Rafsanjani and
Khamenei are political competitors, and that Khamenei threw his
weight behind Hashemi-Rafsanjani's adversary in the June
presidential race. This most recent development argues against this
interpretation of power relationships in Iran. Nor is this the first
time Khamenei has granted significant power to the Expediency
Council. In August 2001, for example, Khamenei had the Expediency
Council determine the circumstances under which President Mohammad
Khatami could be inaugurated.
Perhaps the greater significance of the Expediency
Council's new powers is that it is another case in which an
unelected institution has been given power over elected ones.
Moreover, it could reflect an effort to restore some sort of balance
to the country's politics, in which hard-liners have come to
dominate the executive and legislative branches. (Bill Samii)
ARMED FORCES HOLD MANEUVERS IN NORTHWEST. More than 15,000 members of
Iran's regular armed forces participated in the Joshan exercises
in northwestern Iran that began on 30 September, Fars News Agency
reported. Participants in the three-day exercises in West Azerbaijan
and East Azerbaijan provinces included electronic-warfare,
helicopter, artillery, and engineering units, as well as air-force
bombers. Brigadier General Bakhtiari, whom Fars described as the
spokesman for the exercises, said their aim was to improve combat
readiness and help assess officers and noncommissioned officers.
Bakhtiari said before the exercises began that deployment
capabilities, speed and mobility, and irregular-warfare training
would also be tested. (Bill Samii)
WOMEN TO DRIVE SCOOTERS AGAIN IN TEHRAN. Mohsen Ansari, head of the
Tehran traffic police, said on 4 October that Iranian women will be
allowed to drive motor scooters soon and can apply for permits, Radio
Farda reported. In contrast with their Saudi Arabian counterparts,
Radio Farda reported, Iranian women are allowed to drive automobiles.
Women have not been allowed to drive motor scooters since the 1979
Islamic Revolution until the present because of the possibility that
their "curves" might be exposed while doing so, but since
approximately 1991 their presence on motorcycles or bicycles as
passengers has been tolerated. Women's motorcycling classes were
initiated in Iran three years ago, Radio Farda reported, but they
were closed by the country's leadership. (Bill Samii)
TEHRAN AMONG WORST PLACES TO LIVE. In a survey of 127 major
international cities, Tehran was rated one of the worst places to
live, Radio Farda reported on 4 October. With a 52 percent rating
from the Economist Intelligence Unit (EIU), most aspects of living in
Tehran are described as "severely restricted." The EIU survey
considered more than 40 factors in five categories -- "stability,
health care, culture and environment, education, and infrastructure."
The Canadian city of Vancouver was the best place to live, and cities
in Australia, North America, and Western Europe topped the list.
Cities in the Middle East and Africa were the worst places to live.
Tehran was at the top of the 10 worst, scoring higher than Douala,
Cameroon; Harare, Zimbabwe; Abidjan, Ivory Coast; Phnom Penh,
Cambodia; Lagos, Nigeria; Karachi, Pakistan; Dhaka, Bangladesh;
Algiers, Algeria; and Port Moresby, Papua New Guinea. (Bill Samii)
JOURNALIST COMPLAINS OF SHOOT-TO-KILL POLICY. Journalist Amir Abbas
Fakhravar, who has been on prison furlough since June, recently
discussed the possibility of being sent back to prison, Radio Farda
reported on 4 October. He told Radio Farda that after the June
presidential election he and several friends decided they would not
return to prison. He said his sister recently went to court to deal
with the case of her imprisoned husband, Mehrdad Heidarpur, and the
officials there informed her that the Islamic Revolution Guards Corps
and the Basij have been authorized to shoot Fakhravar if he tries to
elude them. (Bill Samii)
HUMAN RIGHTS GROUPS DEMAND LAWYER'S FREEDOM. Radio Farda reported
on 3 October that several Iranian and international human rights
organizations are demanding the release of jailed lawyer Abdolfattah
Soltani, who was detained some two months ago and is in solitary
confinement in Evin prison. Attorney Mohammad Ali Dadkhah told Radio
Farda that Soltani has not been allowed to meet with his lawyers, in
contravention of the law. Dadkhah added that, as far as he knows,
Soltani was allowed to see his family the previous week. The human
rights groups believe that Soltani's prolonged detention is
connected with the case of Zahra Kazemi, a Canadian photojournalist
who was beaten to death at Evin in summer 2003 (see "RFE/RL Iran
Report," 14, 21, and 28 July 2003). (Bill Samii)
THREE KURDISH JOURNALISTS INDICTED IN IRAN. The public prosecutor in
the city of Sanandaj has issued indictments for three Iranian-Kurdish
journalists who are in detention, the Iranian Labor News Agency
(ILNA) reported on 3 October. Attorney Abbas Jamali said the warrants
for Ejlal Qavami, Said Saedi, and Roya Tolui refer them to the
Revolutionary Court. Jamali said his clients -- Qavami and Saedi --
have been detained for 60 days already, and they are accused of
acting against national security. (Bill Samii)
STOCK EXCHANGE HAS LONG-TERM DIFFICULTIES. Iranian commentators have
recently referred to a "crisis" on the Tehran Stock Exchange. The
slump is particularly evident because the market's key index
(Tepix) rose by nearly 80 percent between March 2001 and April 2003,
while the indices of exchanges in Frankfurt, London, New York, Paris,
and Tokyo tumbled by 40-70 percent. The gains in Iranian securities
had continued until recently, too, culminating in a tripling of the
key Tehran index in the period from 2001 to May 2005.
The downturn has been attributed to uncertainty over the
future based on the nuclear question, as well as to President Mahmud
Ahmadinejad's seemingly negative attitude toward the stock
market. These factors might disappear or be resolved, but at least
one economist has noted that the Iranian stock exchange suffers from
deeply entrenched problems. These will be more difficult to resolve.
A Slow Start
The Tehran Stock Exchange began dealing in the shares of a
few private banks and companies, as well as treasury bonds and
state-backed securities, in 1968. By the 1979 Islamic Revolution, 105
firms were listed on the exchange. That number fell to 56 after the
revolution, as private banks were nationalized and enterprises
belonging to the royal family were expropriated. Islamic regulations
against interest payments, Marxist hostility to capitalist
institutions, and the 1980-88 Iran-Iraq War all stifled activity on
the stock exchange, economist Jahangir Amuzegar wrote in "Middle East
Economic Survey" in May.
The exchange enjoyed a brief surge from 1994 through 1997
before tapering off. When the annual money supply increased and there
was a mild recession in other prospective areas of investment,
Amuzegar explains, there was a "meteoric boom." The Privatization
Agency's initial public offerings (IPOs) contributed to this.
>From March 1999 to March 2003, the Tepix catapulted from 2,206 to
11,400, and trading increased from 1.7 billion shares to 7.9 billion
shares. The exchange hit a high of 13,836 in December 2004.
Indeed, the market was so heated that in August 2003, the
head of the stock exchange forbade any price increases for a two-week
period.
New Concerns
In late September and early October, many observers expressed
concerns over the state of the Iranian market. Hussein Abdeh-Tabrizi,
secretary-general of the stock exchange, hinted at a crisis,
"Farhang-i Ashti" reported on 5 October. Abdeh-Tabrizi said
uncertainty over the nuclear issue undermines investor confidence. He
also said the government and the exchange are trying to determine how
to support the stock market, and he added that offering shares in
state enterprises is one way to motivate prospective investors.
Moderation and Progress Party Secretary-General Mohammad
Baqer Nobakht argued that problems in the stock market are connected
with an unclear economic future, "Aftab-i Yazd" reported on 5
October. The government should stop repeating slogans and offer a
solution, Nobakht urged.
In the 2 October legislative session, Lahijan representative
Iraj Nadimi, rapporteur of the parliamentary Economic Committee,
called on the economy minister to explore the political roots of the
stock-market slump and take action, "Resalat" reported on 3 October.
Nadimi said previously that the legislature would look into the
causes of the market crisis in the coming fortnight, "Iran" newspaper
reported on 1 October. "At the present, the Iranian stock market is
facing some serious problems, and if the reasons for this situation
are not identified and tackled, its consequences will certainly
inflict harm on the country's economy," Nadimi said.
The 1 October report in "Iran" newspaper noted that the Tepix
had fallen almost 400 points in the previous two weeks. The paper
added that the head of the exchange, deputy Finance and Economic
Affairs Minister Tahmasb Mazaheri, and other officials had met to
discuss ways to restore normalcy to the market. Participants in the
meeting attributed the situation to "psychological factors" and
concern over the nuclear issue. They called for greater attention and
sensitivity to the issue by the government, they decided to ask major
shareholders to try to prop up purchases, and they considered asking
banks to offer incentives to purchasers of stocks.
Seeking A Government Commitment
An editorial in "Sharq" newspaper on 29 September warned that
if the current pattern continues, the Tepix will be 26 percent lower
than its high point in December 2004. "Sharq" said the trend in the
stock exchange can be reversed "only if the new government displays
an open and strong commitment to open economy by moving toward
privatization, [and] supporting investment." The editorial also
recommended eliminating corruption and encouraging investment. The
government must prove its interest in "genuine reforms" rather than
"repeating the past," the paper argued.
The English-language "Iran News" reported on 27 September
that the Iranian stock market was undergoing "one of the most serious
crises in its entire existence...[in the form of] a continuous slump
ever since last June's presidential election." The newspaper
reported that many investors are pulling out. "Iran News" attributed
the situation to the reasons described elsewhere: uncertainty,
concern over government plans, and the nuclear issue. The daily added
that investor confidence was further undermined by Economy Minister
Davud Danesh-Jafari's failure to attend a monthly meeting of the
exchange's high council.
But the impact of Ahmadinejad's victory was being felt
just days after the election, in the face of reports that he had
compared the stock market unfavorably with gambling. His
representatives and state media said Ahmadinejad actually favors the
capital market and wants to expand it. And the president-elect
himself said he supported using the stock market to encourage
investment.
Deep-Seated Problems
Uncertainty over the nuclear issue persists. Moreover, this
question continues to adversely affect Iran's relations with the
international community. These factors are likely to continue to have
a negative impact on investor confidence and the Tehran Stock
Exchange. Ahmadinejad, on the other hand, could implement economic
policies that restore people's willingness to invest in the
market. This is not a certainty, however, as the president's
recent comments indicate that he does not fully embrace the role of
an independent exchange. When he discussed economic affairs and the
stock market on 5 October, Ahmadinejad said market fluctuations can
be controlled because 80 percent of the issues belong to state
entities, state television reported.
More deeply entrenched factors suggest the stock exchange has
a risky future. Amuzegar writes in "Middle East Economic Survey" that
the exchange's governance structure makes it a "virtual appendage
of the state" -- its top decision-makers are government officials or
government appointees. Eighty percent of its market value is owned by
state organizations or parastatal institutions, such as the
foundations (bonyad). The exchange is small -- of the 680,000
companies registered in the country, only 420 are listed on the
exchange. One hundred of those companies are totally inactive,
Amuzegar points out, and fewer than 200 are traded regularly.
There is a "perpetual imbalance between demand for shares and
their supply," Amuzegar continues, and there is "insufficient
liquidity." Furthermore, Western standards of transparency,
enforcement, self-regulation, and disclosure are absent. There is no
equivalent of a Securities and Exchange Commission that can enforce
rules or standards of accountability. On top of that, share prices
are susceptible to manipulation by speculators and others with
insider information or various forms of influence.
Finally, foreign participation remains "fairly limited."
Foreigners are allowed to buy just 10 percent of any listed company,
and principal, dividends, and capital gains can only be repatriated
after thee years. (Bill Samii)
IRAN MIGHT RUN OUT OF OIL IN 90 YEARS. A conference on the Iranian
nuclear program, "Iran in the 21st Century: Energy and Security,"
took place in Madrid on 3 October, the Islamic Republic News Agency
(IRNA) reported. Morteza Alviri, Iran's ambassador to Spain and
the former mayor of Tehran, said the conference is a good opportunity
for the improvement of bilateral ties.
Speaking at the same event, Deputy Petroleum Minister Hadi
Nejad-Husseinian said Iran's oil reserves could be exhausted in
90 years, IRNA reported. Nejad-Husseinian said Iran's oil
reserves stand at 137 billion barrels and its natural-gas reserves at
29 trillion cubic meters. He said the Middle East will become the
world's biggest supplier of energy, and that is why "the ruling
neo-conservatives in the U.S." want to dominate the region. That also
explains U.S. hostility to Iran, he said. He expressed the hope that
Europe will be a more active player in the Iranian energy sector.
Speaking at the same event, Deputy Foreign Minister Ali-Reza
Moayeri said Iran will continue with its nuclear program, IRNA
reported. (Bill Samii)
U.S. REITERATES CONCERN FOR IRAN'S PURSUIT OF NUCLEAR WEAPONS.
U.S. State Department spokesman Scott McCormack said at a 4 October
press briefing that Iran must not be allowed to have nuclear weapons,
Radio Farda reported. McCormack dismissed Tehran's claims that it
only seeks the peaceful use of nuclear energy, saying its "objective
is to pursue nuclear weapons." (Bill Samii)
U.S. URGES RUSSIA TO HALT NUCLEAR EXCHANGE WITH IRAN. Speaking to the
UN General Assembly's Disarmament Committee on 3 October, acting
U.S. Assistant Secretary of State for arms control Stephen Rademaker
said that all governments should halt nuclear trade with Iran in
light of the resolution adopted by the International Atomic Energy
Agency on 24 September stressing Tehran's noncompliance with the
Nuclear Nonproliferation Treaty, AP and other media reported. "We
think it's self-evident, for example, that in the face of such a
finding, no government should permit new nuclear transfers to Iran
and all ongoing nuclear projects should be frozen," Rademaker said.
Meanwhile, "an informed source within the Kremlin," told
RIA-Novosti on 3 October that Russia considers "direct threats or
excessive pressure on Iran" to be "inefficient." Moscow is concerned
that pressure on Tehran could eventually "push Iran out of the legal
frameworks," the source said. It added that if confrontation around
the Iranian nuclear program escalates, Russia could suffer more than
Iran because its contract "provides jobs to tens of thousands of
people and hundreds of enterprises," RIA-Novosti reported. (Victor
Yassman)
IRAN OPEN TO RESUMING DISCUSSIONS WITH EU. President Mahmud
Ahmadinejad said in a 5 October assessment of the first 38 days of
his presidency that Iran is not opposed to negotiations on the
nuclear issue, state television reported. However, he added, Iran
will not accept negotiations that are meant to deprive Iranians of
their rights. Ahmadinejad said European countries other than the EU-3
(France, Germany, and the United Kingdom) have shown an interest in
discussing the nuclear issue with Iran, and these proposals are under
review. Turning to the country's foreign policy in general,
Ahmadinejad said Iranian diplomats defend the country's rights
confidently.
Iranian Foreign Ministry spokesman Hamid Reza Assefi said on
4 October that Iran is willing to resume discussions with the
European Union if there are no preconditions, Mehr News Agency
reported. He said Iran must see acts of goodwill from the Europeans
and they must act like they really want to hold discussions with
Tehran.
One day earlier, foreign ministers of the Council of the
European Union met and discussed Iran. They fully support the
governing board of the International Atomic Energy Agency's
(IAEA) 24 September resolution, and they urged Iran to implement
measures called for by the IAEA, including suspension of all
fuel-cycle activities. The council reaffirmed its support for a
negotiated solution within the framework of the November 2004 Paris
Agreement.
Javier Solana, the European Union's high representative
for common foreign and security policy, suggested on 3 October that
the EU is prepared to restart talks if Iran complies with calls to
halt some nuclear-related activities. "If, taking the international
community's view into account, Iran is ready to halt
uranium-enrichment work, the EU, for its part, will be ready for a
resumption of talks with Tehran," Interfax news agency quoted him as
saying. Solana said the UN Security Council should increase the
IAEA's powers to resolve the Iranian nuclear issue. "We regard
Iran's refusal to carry out its obligations under the Treaty on
Nonproliferation of Nuclear Weapons as a very serious question, and
we want the UN Security Council to widen IAEA's powers to resolve
it," Solana said. An EU-Russia summit is scheduled to begin in London
on 4 October, and the Iranian nuclear program is reportedly on the
agenda.
The day after the IAEA governing board passed a resolution
criticizing Iran for its inadequate cooperation and transparency,
Iranian legislators called on their government to suspend its
voluntary implementation of the Additional Protocol of the Nuclear
Nonproliferation Treaty. Legislators put the item at the top of the
parliamentary agenda, but they are still debating the issue.
Kazem Jalali, rapporteur for the National Security and
Foreign Policy Committee, told state radio on 3 October that some
legislators do not believe there is a need for such a bill, because
the government's implementation of the Additional Protocol
without parliamentary ratification was improper. On 2 October, Jalali
told IRNA that the issue was debated extensively. (Bill Samii)
NEW PRESIDENT'S DIPLOMACY SPARKS CONTROVERSY. On the sidelines of
a pro-nuclear-power rally in Tehran on 7 October, Iranian government
spokesman Gholam Hussein Elham said all the country's officials
agree with Tehran's conduct of nuclear negotiations and its
general interaction with other countries, the Islamic Republic News
Agency (IRNA) reported. "With the exception of those who disagree
with the Islamic system in principle," Elham added, "there is no
disagreement among political parties or groups that conduct their
activities within the law and believe in the principle of the Islamic
system in Iran." However, the general lack of diplomatic finesse
displayed by President Mahmud Ahmadinejad and his new administration
has caught observers by surprise, and the Iranians' actions and
comments on the nuclear issue have alienated foreign capitals that
previously were positively disposed toward Tehran.
Observers in Iran are expressing concern about this turn of
events. On the one hand, the Iranian decision-making apparatus is not
closed, so these concerns could have an impact on governmental
actions. On the other hand, Ahmadinejad's actions appear to have
Supreme Leader Ayatollah Ali Khamenei's approval, so anticipation
of a reversal may be unrealistic.
Ahmadinejad's Lack Of Finesse
Ahmadinejad's style has been evident since August, when
Tehran first rejected a European Union proposal on the nuclear issue.
The EU proposal ruled out Iran's enriching uranium and
reprocessing plutonium, recommended allowing Iran to purchase nuclear
fuel and send it elsewhere for disposal, and called for a
continuation of Iran's voluntary suspension of uranium-conversion
activities. Other aspects of the proposal focused on industrial and
technological cooperation, energy issues, and intellectual property
rights.
The international community was eager to hear
Ahmadinejad's counterproposal when he addressed the UN General
Assembly on 17 September. However, rather than moving the
negotiations forward, Ahmadinejad aired grievances relating to events
that took place more than half a century ago. He also discussed his
conspiracy theory about the 11 September 2001 terrorist attacks and
accused the United States of creating and supporting Al-Qaeda.
Ahmadinejad called for a nuclear-weapons-free Middle East and
expressed concern about "nuclear apartheid." He offered a "serious
partnership" with other countries' private and public sectors
implementing uranium-enrichment programs. Ahmadinejad was adamant
about Iran's intention to master the nuclear-fuel cycle.
One week later, the IAEA governing board issued a resolution
calling on Tehran to be more cooperative and transparent, and hinting
that referral to the UN Security Council could be next.
In a purported interview that appeared in the 1 October
"Khaleej Times" newspaper, based in the United Arab Emirates,
Ahmadinejad was quoted as saying that Iran has the right to use
nuclear energy peacefully, and the production or use of nuclear
weapons is forbidden by Islam. He purportedly stressed that Iran has
been cooperating with the IAEA. "But if Iran's case is sent to
the Security Council," he was quoted as saying, "we will respond by
many ways for example by holding back on oil sales or limiting
inspections of our nuclear facilities."
The same day, however, the presidential office rejected the
authenticity of the interview, IRNA reported. The presidential office
said Ahmadinejad never gave an oral or written interview to the
newspaper. "Such a claim is nothing more than a mere fabrication, so
we call all domestic media to be aware and show vigilance in dealing
with propaganda plots hatched by foreign media," the statement from
Ahmadinejad's office said.
Critical Rivals
Ahmadinejad's foreign-policy team -- Supreme National
Security Council Secretary Ali Larijani and Foreign Minister Mustafa
Mottaki -- has been unfavorably compared with the intellectual but
feckless team assembled by former President Hojatoleslam Mohammad
Khatami. The latter team included experienced individuals such as
Foreign Minister Kamal Kharrazi and Supreme National Security Council
Secretary Hojatoleslam Hassan Rohani. These officials stressed
perceived national interests rather than ideology and nationalism
when conducting business, therefore conveying the impression that
they were rational actors with whom others could do business.
Iranian observers are becoming increasingly aware of the
negative impact of Ahmadinejad's actions, and they are
criticizing his diplomatic efforts.
Expediency Council Secretary Mohsen Rezai told reporters on 1
October that Ahmadinejad's 17 September proposal at the UN was
inadvisable and unnecessary, the Iranian Students News Agency (ISNA)
reported. "When Iran didn't accept the Europeans' proposal,
the latter should have amended it," Rezai said. "There was no need
for Iran to make a proposal to the Europeans." Rezai said this might
have been a diplomatic mistake, but if the issue is managed well,
then "America and Europe will be the main losers if our case is
referred to the Security Council."
The chairman of the Expediency Council, Ayatollah Ali-Akbar
Hashemi-Rafsanjani, said in his 30 September sermon at the Tehran
Friday prayers that Iran is determined to defend its right to use
nuclear technology and it will not be intimidated into surrendering,
state radio reported. He said Iran should talk with its opponents --
which he identified as "America, Europe, and others" -- and achieve
trust. "I would like to let the [Iranian] managers in this sector
know that here you need diplomacy and not slogans," he said.
Hashemi-Rafsanjani called for prudence, patience, and wisdom, while
avoiding provocations. He said this issue must be resolved while
protecting Iran's rights.
Time For 'Crisis Diplomacy'
Criticism from Rezai and Hashemi-Rafsanjani is not altogether
unexpected. They were Ahmadinejad's rivals in the presidential
election. Rezai may have expected a cabinet post or Supreme National
Security Council position in exchange for his stepping out of the
presidential race at the last minute. Furthermore, the 49- year-old
Ahmadinejad's blunt, confrontational style is very unlike that of
the much older and more pragmatic Hashemi-Rafsanjani.
But there has been criticism from other corners as well.
Tabriz parliamentary representative Akbar Alami, who serves on the
Foreign Policy and National Security Committee, said of the Supreme
National Security Committee: "People who until very recently did not
have any knowledge about the nuclear dossier and did not even know
what nuclear energy was have now become high-ranking experts in the
nuclear dossier of the Islamic Republic of Iran." He also criticized
some of his colleagues in the legislature, "Aftab-i Yazd" reported on
29 September. He accused some parliamentarians of trying to block
discussion of the nuclear issue, saying they are acting on behalf of
the Supreme National Security Council.
A commentary in the pro-reform "Sharq" on 2 October noted
that Iran is facing an "atmosphere of distrust" in the international
arena. The Ahmadinejad administration's eastward-oriented foreign
policy has proven to be ineffective in the nuclear case, the daily
continued, so "the diplomatic apparatus should understand
international realities and distance itself from the Security Council
tsunami." The commentary also recommended the creation of a
"crisis-diplomacy team."
An editorial in the hard-line "Resalat" daily on 29 September
also commented on the needs of the foreign-policy team. It noted that
the diplomats need a "guidance council" or a "thinking room"
(presumably, a foreign-policy think tank). "Resalat" said diplomats
and politicians do not have the time to study the issues they must
deal with because of their workloads, while researchers and scholars
are somewhat out of touch with the realities of diplomacy. "The
establishment of a thinking room can bring the areas of operations
and research closer together and create balance and equilibrium and
make up for the research shortcomings and weaknesses in the area of
foreign policy."
No Obvious Effect
Ahmadinejad has evidently not been touched by such criticism.
In a 5 October speech he said Iran is not opposed to negotiations on
the nuclear issue, state television reported. But he added that Iran
will not accept negotiations that are meant to deprive Iranians of
their rights. Ahmadinejad said European countries other than the
so-called EU-3 (France, Germany, and the United Kingdom) have shown
an interest in discussing the nuclear issue with Iran, and these
proposals are under review. Turning to the country's foreign
policy in general, Ahmadinejad said Iranian diplomats defend the
country's rights confidently.
Iran's current position on the nuclear issue should not
be attributed to Ahmadinejad alone. Even before his inauguration
Tehran made it clear that all the regime's leaders have a common
view on nuclear policy. Furthermore, Ahmadinejad is not the only
decision maker on the nuclear issue. Other top officials of the
regime -- including Hashemi-Rafsanjani and Rohani -- contribute to
the process and Supreme Leader Ayatollah Ali Khamenei has veto
authority over his actions. Finally, Tehran has been fairly
forthright for some time on what it sees as its right to master the
complete nuclear-fuel cycle. (Bill Samii)
FOREIGN MINISTER VISITS SOUTHERN NEIGHBORS. Foreign Minister
Manuchehr Mottaki visited Iran's southern Persian Gulf neighbors,
regional news agencies reported on 3-5 October. He arrived in Kuwait
City on 3 October and was received by Prime Minister Sheikh Sabah
al-Ahmad al-Jabir al-Sabah. He also met with National Assembly
speaker Jasim al-Kharafi.
On 4 October, Mottaki arrived in Manama, Bahrain, and was
greeted at the airport by his Bahraini counterpart Sheikh Khalid bin
Ahmad bin Muhammad al-Khalifa. He later met with King Hamad Bin Issa
al-Khalifa, Prime Minister Sheikh Khalifa bin Salman al-Khalifa, and
Deputy Prime Minister Sheikh Muhammad bin Mubarak al-Khalifa.
On 5 October, Mottaki arrived in Muscat, Oman, and was
greeted by Foreign Minister Yusuf bin Alawi. Mottaki arrived in the
city of Al-Ain, which is 140 kilometers from the United Arab Emirates
capital of Abu Dhabi, on the evening of 5 October. The main topic of
discussion during all the visits was the nuclear issue, as well as
Iraq and Palestine. Qatar was the last stop on the trip.
Mottaki was scheduled to visit Saudi Arabia, but an anonymous
Iranian Foreign Ministry official told IRNA on 5 October the trip has
been postponed, although he did not give a reason.
Mottaki returned to Tehran on 7 October. At Tehran's
Mehrabad Airport, he told reporters he made the trip because
President Mahmud Ahmadinejad gives priority to expanding relations
with neighboring states, IRNA reported.
Mottaki ascribed cancellation of the Saudi visit, as well as
one to Syria, to scheduling problems. He went on to say there was no
plan to visit the two countries in the first place. Mottaki said he
would visit Riyadh soon. (Bill Samii)
IRAQI PRESIDENT: NO IRANIAN INTERFERENCE. In an RFE/RL interview in
Prague on 5 October, Iraqi President Jalal Talabani dismissed the
possibility of Iraqi Shi'ite Muslims being loyal to Iran, Radio
Farda reported. Talabani said the Shi'ite brethren are Iraqi and
Arab, and the Shi'ite "Vatican" is in Al-Najaf and Karbala. From
the day Saddam Hussein was deposed, Talabani said, no hostility or
interference on the part of Iran has been seen. Turning to the
Mujahedin Khalq Organization (MKO), an armed Iranian opposition group
identified as a foreign terrorist organization by the U.S. State
Department, Talabani said the MKO is the only Iranian group that
cooperated with Hussein's regime against the Iraqi people, Radio
Farda reported. However, he added, the MKO's current situation is
not problematic. (Bill Samii)
EXPERTS SAY INFRARED BOMBS USED IN IRAQ CANNOT BE HOMEMADE. The
diplomatic row continues between Britain and Iran over British
officials' charges that there is a link between Iranian elements
or Hizballah with new explosive devices being used by insurgents in
Iraq. The sophisticated devices have killed eight British soldiers
since July, but Iran has denounced the British allegations of its
involvement as a lie. British military experts maintain, however,
that only precision-geared military supply factories can produce the
"infrared" bombs also supplied by Iran to Hizballah in Lebanon. And,
British officials say, the evidence still points towards Iran,
despite Tehran's repeated denials. The experts spoke after British
Prime Minister Tony Blair warned Iran on 6 October not to interfere
in Iraq.
Amyas Godfrey has served in Iraq and heads the U.K. Armed
Forces Program at the Royal United Services Institute. He said that
it is usually easy for experienced experts on the ground to say which
group is capable of what kind of bomb attack, including the type of
explosives and packing.
The bombs in question are the "infrared trip-wire" devices
capable of piercing heavy armor. They are exactly the sophisticated
type that has been used by the Iran-funded Hizballah militias in
Lebanon.
"It's a very basic intelligence analysis," Godfrey said.
"We know who's been using them before; we know who's supplied
them. And that's not any doubt. The worry now is that they've
appeared in southern Iraq, being used by insurgents. So, logically,
it's looking like these same weapons are being supplied by the
same people."
Many other military experts share this view, including Bruce
Jones, a security policy adviser to NATO in London. He said a number
of intelligence reports as well as the nature of the devices trace
the bombs to Iran because of three basic facts.
"They have been used in the area in southern Iraq adjacent to
Iran," Jones said. "They are of a type used by Hizballah. And, you do
need a pretty sophisticated set-up, both to procure and to adapt
these technical components."
The last point appears to matter most, Godfrey agreed. That
is: The manufacturing of the components for the bombs is simply
beyond any production capacity the insurgents might have at their
disposal.
"What we're seeing now, are far more military hardware,
and something that requires a manufacturing set-up as in factories,"
Godfrey said. "It's a large amount of high explosives, a shaped
charge, which is quite common in some RPGs [rocket-propelled
grenades] or in armor-piercing weapons."
Godfrey explained that this high-precision charge melts a
hole, for example in the armor plate of a tank, and explodes inside
it. This is why it requires a high-quality manufacture, not something
that could be done in an insurgent hideout.
Jones stressed that another significant feature -- also far
beyond the insurgents' production capability -- is the infrared
"trip-wire."
"It's very much the same concept that you have of
alarms," Jones said. "An infrared beam goes between two points in a
museum, and if that is interrupted, then an alarm goes off."
Godfrey added that the intelligence services have also
gathered a lot of evidence from the attacks on British troops. He
said he doubts, however, whether -- because of its nature -- the
intelligence services would reveal this kind of evidence to the
public.
"Looking through intelligence assessments of these eight
attacks, they all have links to the Hizballah-type explosives,"
Godfrey said. "Unless they have other proof, which we won't know
about, through their security or their intelligence, all we have now
is a likelihood -- i.e., that it is likely that these bombs have come
from Iran, because they are the same type that have been used
before."
British Prime Minister Tony Blair yesterday warned Iran not
to interfere in Iraq. Blair said the nature of the bombs being used
against British troops "lead us either to Iranian elements or the
Hizballah because they are similar to devices used by Hizballah that
is funded and supported by Iran."
But Blair stopped short of explicitly accusing Iran of
supplying the bombs to Iraqi insurgents. "We cannot be sure of this
at the present time," Blair said. (Jan Jun)
************************************************** *******
Copyright (c) 2005. RFE/RL, Inc. All rights reserved.
The "RFE/RL Iran Report" is a weekly prepared by A. William Samii on
the basis of materials from RFE/RL broadcast services, RFE/RL
Newsline, and other news services.
Direct comments to A. William Samii at [email protected].
For information on reprints, see:
http://www.rferl.org/about/content/request.asp
Back issues are online at http://www.rferl.org/reports/iran-report/
_________________________________________ ____________________
RFE/RL Iran Report
Vol. 8, No. 40, 12 October 2005
A Review of Developments in Iran Prepared by the Regional Specialists
of RFE/RL's Newsline Team
************************************************** **********
HEADLINES:
* SYSTEMIC CHANGES COULD WEAKEN ELECTED OFFICIALS, BALANCE
GOVERNMENT
* ARMED FORCES HOLD MANEUVERS IN NORTHWEST
* WOMEN TO DRIVE SCOOTERS AGAIN IN TEHRAN
* TEHRAN AMONG WORST PLACES TO LIVE
* JOURNALIST COMPLAINS OF SHOOT-TO-KILL POLICY
* HUMAN RIGHTS GROUPS DEMAND LAWYER'S FREEDOM
* THREE KURDISH JOURNALISTS INDICTED IN IRAN
* STOCK EXCHANGE HAS LONG-TERM DIFFICULTIES
* IRAN MIGHT RUN OUT OF OIL IN 90 YEARS
* U.S. REITERATES CONCERN FOR IRAN'S PURSUIT OF NUCLEAR WEAPONS
* U.S. URGES RUSSIA TO HALT NUCLEAR EXCHANGE WITH IRAN
* IRAN OPEN TO RESUMING DISCUSSIONS WITH EU
* NEW PRESIDENT'S DIPLOMACY SPARKS CONTROVERSY
* FOREIGN MINISTER VISITS SOUTHERN NEIGHBORS
* IRAQI PRESIDENT: NO IRANIAN INTERFERENCE
* EXPERTS SAY INFRARED BOMBS USED IN IRAQ CANNOT BE HOMEMADE
************************************************** **********
SYSTEMIC CHANGES COULD WEAKEN ELECTED OFFICIALS, BALANCE GOVERNMENT.
The formal decision-making apparatus in the Iranian government has
undergone a significant change in the last few days. This change,
which gives the unelected Expediency Council supervisory powers over
the executive, legislative, and judicial branches of government, has
been met with criticism from members of parliament. This development
reduces the power of elected officials, but it could also reflect an
attempt to restore balance to a system heavily dominated by younger
hard-liners.
Enhanced Council Powers
Mohsen Rezai, secretary of the Expediency Council, was quoted
on 2 October by "Sharq" -- as well as "Aftab-i Yazd," "Etemad,"
"Farhang-i Ashti," and "Hemayat" -- as saying that Supreme Leader
Ayatollah Ali Khamenei recently approved the council's oversight
of the system's policies. In other words, he said, the council
will supervise the three branches of government and report on their
performance to the supreme leader.
Rezai said Khamenei wanted the council to perform this
function some eight years earlier, but the necessary laws did not
exist. About one year ago the council began work on the required
statute, under which the heads of the executive, legislative, and
judicial branches must comply with whatever the Expediency Council
says. Khamenei signed off on this about two months ago, according to
Rezai.
"Sharq" cited Expediency Council Chairman Ayatollah Ali-Akbar
Hashemi-Rafsanjani as saying previously that the supreme leader can
delegate some of his responsibilities to others (per Article 110 of
the constitution), and Rezai said this is what is taking place. Rezai
referred specifically to oversight of the system's general
policies, the fourth economic-development plan, and the 20-year plan.
This appears to be a significant enhancement of the
Expediency Council's powers. When the council was created in
February 1988, its primary purpose was to adjudicate in disputes over
legislation between the Guardians Council and the parliament. Soon
after its creation, it began to frame legislation -- something that
ended only after 100 parliamentarians complained to the supreme
leader. According to Article 112 of the Iranian Constitution, the
council advises the supreme leader, and he consults with it when he
wants to revise the constitution.
Fourth Branch?
Some members of parliament were quick to criticize the
granting of new powers to the Expediency Council. Tabriz
parliamentary representative Akbar Alami warned against making the
council a fourth branch of government, "Etemad" and "Farhang-i Ashti"
reported on 3 October. Alami said the legislature has the lead in
national affairs. He cited Articles 6, 56, and 62, which say,
respectively, that national affairs must be administered on the basis
of elections; the people exercise sovereignty based on the separation
of powers; and the people's representatives are elected directly
by secret ballot. Alami also cited Articles 71 and 76, which say the
legislature can establish laws and the legislature has the right to
examine and investigate national affairs. Alami referred to Article
90, which states that an individual can forward a complaint about one
of the branches of government to the legislature, and the legislature
must investigate this complaint.
On the basis of the constitution, therefore, only the
legislature can supervise the legislature, Alami said. "If this
process continues, the principle of national sovereignty and its
representation through the parliament will be exposed to serious
danger," he said.
Another legislator, Reza Talai-Nik of Bahar and Kabudarahang,
said that Article 110 only applies to supervision over the
system's macro-policies, "Etemad" reported. "It is the
responsibility of the Expediency Council to decide to what extent the
country is moving within the context of the macro-policies of the
system and evaluating those policies," he explained. "However, this
does not mean supervision over executive affairs. Supervising the
executive affairs is part of the responsibilities of the legislative
power."
Vehicle For Influence
The Expediency Council, which Hashemi-Rafsanjani has chaired
for approximately 15 years, is a vehicle for his political influence
and power. But some observers believe that Hashemi-Rafsanjani and
Khamenei are political competitors, and that Khamenei threw his
weight behind Hashemi-Rafsanjani's adversary in the June
presidential race. This most recent development argues against this
interpretation of power relationships in Iran. Nor is this the first
time Khamenei has granted significant power to the Expediency
Council. In August 2001, for example, Khamenei had the Expediency
Council determine the circumstances under which President Mohammad
Khatami could be inaugurated.
Perhaps the greater significance of the Expediency
Council's new powers is that it is another case in which an
unelected institution has been given power over elected ones.
Moreover, it could reflect an effort to restore some sort of balance
to the country's politics, in which hard-liners have come to
dominate the executive and legislative branches. (Bill Samii)
ARMED FORCES HOLD MANEUVERS IN NORTHWEST. More than 15,000 members of
Iran's regular armed forces participated in the Joshan exercises
in northwestern Iran that began on 30 September, Fars News Agency
reported. Participants in the three-day exercises in West Azerbaijan
and East Azerbaijan provinces included electronic-warfare,
helicopter, artillery, and engineering units, as well as air-force
bombers. Brigadier General Bakhtiari, whom Fars described as the
spokesman for the exercises, said their aim was to improve combat
readiness and help assess officers and noncommissioned officers.
Bakhtiari said before the exercises began that deployment
capabilities, speed and mobility, and irregular-warfare training
would also be tested. (Bill Samii)
WOMEN TO DRIVE SCOOTERS AGAIN IN TEHRAN. Mohsen Ansari, head of the
Tehran traffic police, said on 4 October that Iranian women will be
allowed to drive motor scooters soon and can apply for permits, Radio
Farda reported. In contrast with their Saudi Arabian counterparts,
Radio Farda reported, Iranian women are allowed to drive automobiles.
Women have not been allowed to drive motor scooters since the 1979
Islamic Revolution until the present because of the possibility that
their "curves" might be exposed while doing so, but since
approximately 1991 their presence on motorcycles or bicycles as
passengers has been tolerated. Women's motorcycling classes were
initiated in Iran three years ago, Radio Farda reported, but they
were closed by the country's leadership. (Bill Samii)
TEHRAN AMONG WORST PLACES TO LIVE. In a survey of 127 major
international cities, Tehran was rated one of the worst places to
live, Radio Farda reported on 4 October. With a 52 percent rating
from the Economist Intelligence Unit (EIU), most aspects of living in
Tehran are described as "severely restricted." The EIU survey
considered more than 40 factors in five categories -- "stability,
health care, culture and environment, education, and infrastructure."
The Canadian city of Vancouver was the best place to live, and cities
in Australia, North America, and Western Europe topped the list.
Cities in the Middle East and Africa were the worst places to live.
Tehran was at the top of the 10 worst, scoring higher than Douala,
Cameroon; Harare, Zimbabwe; Abidjan, Ivory Coast; Phnom Penh,
Cambodia; Lagos, Nigeria; Karachi, Pakistan; Dhaka, Bangladesh;
Algiers, Algeria; and Port Moresby, Papua New Guinea. (Bill Samii)
JOURNALIST COMPLAINS OF SHOOT-TO-KILL POLICY. Journalist Amir Abbas
Fakhravar, who has been on prison furlough since June, recently
discussed the possibility of being sent back to prison, Radio Farda
reported on 4 October. He told Radio Farda that after the June
presidential election he and several friends decided they would not
return to prison. He said his sister recently went to court to deal
with the case of her imprisoned husband, Mehrdad Heidarpur, and the
officials there informed her that the Islamic Revolution Guards Corps
and the Basij have been authorized to shoot Fakhravar if he tries to
elude them. (Bill Samii)
HUMAN RIGHTS GROUPS DEMAND LAWYER'S FREEDOM. Radio Farda reported
on 3 October that several Iranian and international human rights
organizations are demanding the release of jailed lawyer Abdolfattah
Soltani, who was detained some two months ago and is in solitary
confinement in Evin prison. Attorney Mohammad Ali Dadkhah told Radio
Farda that Soltani has not been allowed to meet with his lawyers, in
contravention of the law. Dadkhah added that, as far as he knows,
Soltani was allowed to see his family the previous week. The human
rights groups believe that Soltani's prolonged detention is
connected with the case of Zahra Kazemi, a Canadian photojournalist
who was beaten to death at Evin in summer 2003 (see "RFE/RL Iran
Report," 14, 21, and 28 July 2003). (Bill Samii)
THREE KURDISH JOURNALISTS INDICTED IN IRAN. The public prosecutor in
the city of Sanandaj has issued indictments for three Iranian-Kurdish
journalists who are in detention, the Iranian Labor News Agency
(ILNA) reported on 3 October. Attorney Abbas Jamali said the warrants
for Ejlal Qavami, Said Saedi, and Roya Tolui refer them to the
Revolutionary Court. Jamali said his clients -- Qavami and Saedi --
have been detained for 60 days already, and they are accused of
acting against national security. (Bill Samii)
STOCK EXCHANGE HAS LONG-TERM DIFFICULTIES. Iranian commentators have
recently referred to a "crisis" on the Tehran Stock Exchange. The
slump is particularly evident because the market's key index
(Tepix) rose by nearly 80 percent between March 2001 and April 2003,
while the indices of exchanges in Frankfurt, London, New York, Paris,
and Tokyo tumbled by 40-70 percent. The gains in Iranian securities
had continued until recently, too, culminating in a tripling of the
key Tehran index in the period from 2001 to May 2005.
The downturn has been attributed to uncertainty over the
future based on the nuclear question, as well as to President Mahmud
Ahmadinejad's seemingly negative attitude toward the stock
market. These factors might disappear or be resolved, but at least
one economist has noted that the Iranian stock exchange suffers from
deeply entrenched problems. These will be more difficult to resolve.
A Slow Start
The Tehran Stock Exchange began dealing in the shares of a
few private banks and companies, as well as treasury bonds and
state-backed securities, in 1968. By the 1979 Islamic Revolution, 105
firms were listed on the exchange. That number fell to 56 after the
revolution, as private banks were nationalized and enterprises
belonging to the royal family were expropriated. Islamic regulations
against interest payments, Marxist hostility to capitalist
institutions, and the 1980-88 Iran-Iraq War all stifled activity on
the stock exchange, economist Jahangir Amuzegar wrote in "Middle East
Economic Survey" in May.
The exchange enjoyed a brief surge from 1994 through 1997
before tapering off. When the annual money supply increased and there
was a mild recession in other prospective areas of investment,
Amuzegar explains, there was a "meteoric boom." The Privatization
Agency's initial public offerings (IPOs) contributed to this.
>From March 1999 to March 2003, the Tepix catapulted from 2,206 to
11,400, and trading increased from 1.7 billion shares to 7.9 billion
shares. The exchange hit a high of 13,836 in December 2004.
Indeed, the market was so heated that in August 2003, the
head of the stock exchange forbade any price increases for a two-week
period.
New Concerns
In late September and early October, many observers expressed
concerns over the state of the Iranian market. Hussein Abdeh-Tabrizi,
secretary-general of the stock exchange, hinted at a crisis,
"Farhang-i Ashti" reported on 5 October. Abdeh-Tabrizi said
uncertainty over the nuclear issue undermines investor confidence. He
also said the government and the exchange are trying to determine how
to support the stock market, and he added that offering shares in
state enterprises is one way to motivate prospective investors.
Moderation and Progress Party Secretary-General Mohammad
Baqer Nobakht argued that problems in the stock market are connected
with an unclear economic future, "Aftab-i Yazd" reported on 5
October. The government should stop repeating slogans and offer a
solution, Nobakht urged.
In the 2 October legislative session, Lahijan representative
Iraj Nadimi, rapporteur of the parliamentary Economic Committee,
called on the economy minister to explore the political roots of the
stock-market slump and take action, "Resalat" reported on 3 October.
Nadimi said previously that the legislature would look into the
causes of the market crisis in the coming fortnight, "Iran" newspaper
reported on 1 October. "At the present, the Iranian stock market is
facing some serious problems, and if the reasons for this situation
are not identified and tackled, its consequences will certainly
inflict harm on the country's economy," Nadimi said.
The 1 October report in "Iran" newspaper noted that the Tepix
had fallen almost 400 points in the previous two weeks. The paper
added that the head of the exchange, deputy Finance and Economic
Affairs Minister Tahmasb Mazaheri, and other officials had met to
discuss ways to restore normalcy to the market. Participants in the
meeting attributed the situation to "psychological factors" and
concern over the nuclear issue. They called for greater attention and
sensitivity to the issue by the government, they decided to ask major
shareholders to try to prop up purchases, and they considered asking
banks to offer incentives to purchasers of stocks.
Seeking A Government Commitment
An editorial in "Sharq" newspaper on 29 September warned that
if the current pattern continues, the Tepix will be 26 percent lower
than its high point in December 2004. "Sharq" said the trend in the
stock exchange can be reversed "only if the new government displays
an open and strong commitment to open economy by moving toward
privatization, [and] supporting investment." The editorial also
recommended eliminating corruption and encouraging investment. The
government must prove its interest in "genuine reforms" rather than
"repeating the past," the paper argued.
The English-language "Iran News" reported on 27 September
that the Iranian stock market was undergoing "one of the most serious
crises in its entire existence...[in the form of] a continuous slump
ever since last June's presidential election." The newspaper
reported that many investors are pulling out. "Iran News" attributed
the situation to the reasons described elsewhere: uncertainty,
concern over government plans, and the nuclear issue. The daily added
that investor confidence was further undermined by Economy Minister
Davud Danesh-Jafari's failure to attend a monthly meeting of the
exchange's high council.
But the impact of Ahmadinejad's victory was being felt
just days after the election, in the face of reports that he had
compared the stock market unfavorably with gambling. His
representatives and state media said Ahmadinejad actually favors the
capital market and wants to expand it. And the president-elect
himself said he supported using the stock market to encourage
investment.
Deep-Seated Problems
Uncertainty over the nuclear issue persists. Moreover, this
question continues to adversely affect Iran's relations with the
international community. These factors are likely to continue to have
a negative impact on investor confidence and the Tehran Stock
Exchange. Ahmadinejad, on the other hand, could implement economic
policies that restore people's willingness to invest in the
market. This is not a certainty, however, as the president's
recent comments indicate that he does not fully embrace the role of
an independent exchange. When he discussed economic affairs and the
stock market on 5 October, Ahmadinejad said market fluctuations can
be controlled because 80 percent of the issues belong to state
entities, state television reported.
More deeply entrenched factors suggest the stock exchange has
a risky future. Amuzegar writes in "Middle East Economic Survey" that
the exchange's governance structure makes it a "virtual appendage
of the state" -- its top decision-makers are government officials or
government appointees. Eighty percent of its market value is owned by
state organizations or parastatal institutions, such as the
foundations (bonyad). The exchange is small -- of the 680,000
companies registered in the country, only 420 are listed on the
exchange. One hundred of those companies are totally inactive,
Amuzegar points out, and fewer than 200 are traded regularly.
There is a "perpetual imbalance between demand for shares and
their supply," Amuzegar continues, and there is "insufficient
liquidity." Furthermore, Western standards of transparency,
enforcement, self-regulation, and disclosure are absent. There is no
equivalent of a Securities and Exchange Commission that can enforce
rules or standards of accountability. On top of that, share prices
are susceptible to manipulation by speculators and others with
insider information or various forms of influence.
Finally, foreign participation remains "fairly limited."
Foreigners are allowed to buy just 10 percent of any listed company,
and principal, dividends, and capital gains can only be repatriated
after thee years. (Bill Samii)
IRAN MIGHT RUN OUT OF OIL IN 90 YEARS. A conference on the Iranian
nuclear program, "Iran in the 21st Century: Energy and Security,"
took place in Madrid on 3 October, the Islamic Republic News Agency
(IRNA) reported. Morteza Alviri, Iran's ambassador to Spain and
the former mayor of Tehran, said the conference is a good opportunity
for the improvement of bilateral ties.
Speaking at the same event, Deputy Petroleum Minister Hadi
Nejad-Husseinian said Iran's oil reserves could be exhausted in
90 years, IRNA reported. Nejad-Husseinian said Iran's oil
reserves stand at 137 billion barrels and its natural-gas reserves at
29 trillion cubic meters. He said the Middle East will become the
world's biggest supplier of energy, and that is why "the ruling
neo-conservatives in the U.S." want to dominate the region. That also
explains U.S. hostility to Iran, he said. He expressed the hope that
Europe will be a more active player in the Iranian energy sector.
Speaking at the same event, Deputy Foreign Minister Ali-Reza
Moayeri said Iran will continue with its nuclear program, IRNA
reported. (Bill Samii)
U.S. REITERATES CONCERN FOR IRAN'S PURSUIT OF NUCLEAR WEAPONS.
U.S. State Department spokesman Scott McCormack said at a 4 October
press briefing that Iran must not be allowed to have nuclear weapons,
Radio Farda reported. McCormack dismissed Tehran's claims that it
only seeks the peaceful use of nuclear energy, saying its "objective
is to pursue nuclear weapons." (Bill Samii)
U.S. URGES RUSSIA TO HALT NUCLEAR EXCHANGE WITH IRAN. Speaking to the
UN General Assembly's Disarmament Committee on 3 October, acting
U.S. Assistant Secretary of State for arms control Stephen Rademaker
said that all governments should halt nuclear trade with Iran in
light of the resolution adopted by the International Atomic Energy
Agency on 24 September stressing Tehran's noncompliance with the
Nuclear Nonproliferation Treaty, AP and other media reported. "We
think it's self-evident, for example, that in the face of such a
finding, no government should permit new nuclear transfers to Iran
and all ongoing nuclear projects should be frozen," Rademaker said.
Meanwhile, "an informed source within the Kremlin," told
RIA-Novosti on 3 October that Russia considers "direct threats or
excessive pressure on Iran" to be "inefficient." Moscow is concerned
that pressure on Tehran could eventually "push Iran out of the legal
frameworks," the source said. It added that if confrontation around
the Iranian nuclear program escalates, Russia could suffer more than
Iran because its contract "provides jobs to tens of thousands of
people and hundreds of enterprises," RIA-Novosti reported. (Victor
Yassman)
IRAN OPEN TO RESUMING DISCUSSIONS WITH EU. President Mahmud
Ahmadinejad said in a 5 October assessment of the first 38 days of
his presidency that Iran is not opposed to negotiations on the
nuclear issue, state television reported. However, he added, Iran
will not accept negotiations that are meant to deprive Iranians of
their rights. Ahmadinejad said European countries other than the EU-3
(France, Germany, and the United Kingdom) have shown an interest in
discussing the nuclear issue with Iran, and these proposals are under
review. Turning to the country's foreign policy in general,
Ahmadinejad said Iranian diplomats defend the country's rights
confidently.
Iranian Foreign Ministry spokesman Hamid Reza Assefi said on
4 October that Iran is willing to resume discussions with the
European Union if there are no preconditions, Mehr News Agency
reported. He said Iran must see acts of goodwill from the Europeans
and they must act like they really want to hold discussions with
Tehran.
One day earlier, foreign ministers of the Council of the
European Union met and discussed Iran. They fully support the
governing board of the International Atomic Energy Agency's
(IAEA) 24 September resolution, and they urged Iran to implement
measures called for by the IAEA, including suspension of all
fuel-cycle activities. The council reaffirmed its support for a
negotiated solution within the framework of the November 2004 Paris
Agreement.
Javier Solana, the European Union's high representative
for common foreign and security policy, suggested on 3 October that
the EU is prepared to restart talks if Iran complies with calls to
halt some nuclear-related activities. "If, taking the international
community's view into account, Iran is ready to halt
uranium-enrichment work, the EU, for its part, will be ready for a
resumption of talks with Tehran," Interfax news agency quoted him as
saying. Solana said the UN Security Council should increase the
IAEA's powers to resolve the Iranian nuclear issue. "We regard
Iran's refusal to carry out its obligations under the Treaty on
Nonproliferation of Nuclear Weapons as a very serious question, and
we want the UN Security Council to widen IAEA's powers to resolve
it," Solana said. An EU-Russia summit is scheduled to begin in London
on 4 October, and the Iranian nuclear program is reportedly on the
agenda.
The day after the IAEA governing board passed a resolution
criticizing Iran for its inadequate cooperation and transparency,
Iranian legislators called on their government to suspend its
voluntary implementation of the Additional Protocol of the Nuclear
Nonproliferation Treaty. Legislators put the item at the top of the
parliamentary agenda, but they are still debating the issue.
Kazem Jalali, rapporteur for the National Security and
Foreign Policy Committee, told state radio on 3 October that some
legislators do not believe there is a need for such a bill, because
the government's implementation of the Additional Protocol
without parliamentary ratification was improper. On 2 October, Jalali
told IRNA that the issue was debated extensively. (Bill Samii)
NEW PRESIDENT'S DIPLOMACY SPARKS CONTROVERSY. On the sidelines of
a pro-nuclear-power rally in Tehran on 7 October, Iranian government
spokesman Gholam Hussein Elham said all the country's officials
agree with Tehran's conduct of nuclear negotiations and its
general interaction with other countries, the Islamic Republic News
Agency (IRNA) reported. "With the exception of those who disagree
with the Islamic system in principle," Elham added, "there is no
disagreement among political parties or groups that conduct their
activities within the law and believe in the principle of the Islamic
system in Iran." However, the general lack of diplomatic finesse
displayed by President Mahmud Ahmadinejad and his new administration
has caught observers by surprise, and the Iranians' actions and
comments on the nuclear issue have alienated foreign capitals that
previously were positively disposed toward Tehran.
Observers in Iran are expressing concern about this turn of
events. On the one hand, the Iranian decision-making apparatus is not
closed, so these concerns could have an impact on governmental
actions. On the other hand, Ahmadinejad's actions appear to have
Supreme Leader Ayatollah Ali Khamenei's approval, so anticipation
of a reversal may be unrealistic.
Ahmadinejad's Lack Of Finesse
Ahmadinejad's style has been evident since August, when
Tehran first rejected a European Union proposal on the nuclear issue.
The EU proposal ruled out Iran's enriching uranium and
reprocessing plutonium, recommended allowing Iran to purchase nuclear
fuel and send it elsewhere for disposal, and called for a
continuation of Iran's voluntary suspension of uranium-conversion
activities. Other aspects of the proposal focused on industrial and
technological cooperation, energy issues, and intellectual property
rights.
The international community was eager to hear
Ahmadinejad's counterproposal when he addressed the UN General
Assembly on 17 September. However, rather than moving the
negotiations forward, Ahmadinejad aired grievances relating to events
that took place more than half a century ago. He also discussed his
conspiracy theory about the 11 September 2001 terrorist attacks and
accused the United States of creating and supporting Al-Qaeda.
Ahmadinejad called for a nuclear-weapons-free Middle East and
expressed concern about "nuclear apartheid." He offered a "serious
partnership" with other countries' private and public sectors
implementing uranium-enrichment programs. Ahmadinejad was adamant
about Iran's intention to master the nuclear-fuel cycle.
One week later, the IAEA governing board issued a resolution
calling on Tehran to be more cooperative and transparent, and hinting
that referral to the UN Security Council could be next.
In a purported interview that appeared in the 1 October
"Khaleej Times" newspaper, based in the United Arab Emirates,
Ahmadinejad was quoted as saying that Iran has the right to use
nuclear energy peacefully, and the production or use of nuclear
weapons is forbidden by Islam. He purportedly stressed that Iran has
been cooperating with the IAEA. "But if Iran's case is sent to
the Security Council," he was quoted as saying, "we will respond by
many ways for example by holding back on oil sales or limiting
inspections of our nuclear facilities."
The same day, however, the presidential office rejected the
authenticity of the interview, IRNA reported. The presidential office
said Ahmadinejad never gave an oral or written interview to the
newspaper. "Such a claim is nothing more than a mere fabrication, so
we call all domestic media to be aware and show vigilance in dealing
with propaganda plots hatched by foreign media," the statement from
Ahmadinejad's office said.
Critical Rivals
Ahmadinejad's foreign-policy team -- Supreme National
Security Council Secretary Ali Larijani and Foreign Minister Mustafa
Mottaki -- has been unfavorably compared with the intellectual but
feckless team assembled by former President Hojatoleslam Mohammad
Khatami. The latter team included experienced individuals such as
Foreign Minister Kamal Kharrazi and Supreme National Security Council
Secretary Hojatoleslam Hassan Rohani. These officials stressed
perceived national interests rather than ideology and nationalism
when conducting business, therefore conveying the impression that
they were rational actors with whom others could do business.
Iranian observers are becoming increasingly aware of the
negative impact of Ahmadinejad's actions, and they are
criticizing his diplomatic efforts.
Expediency Council Secretary Mohsen Rezai told reporters on 1
October that Ahmadinejad's 17 September proposal at the UN was
inadvisable and unnecessary, the Iranian Students News Agency (ISNA)
reported. "When Iran didn't accept the Europeans' proposal,
the latter should have amended it," Rezai said. "There was no need
for Iran to make a proposal to the Europeans." Rezai said this might
have been a diplomatic mistake, but if the issue is managed well,
then "America and Europe will be the main losers if our case is
referred to the Security Council."
The chairman of the Expediency Council, Ayatollah Ali-Akbar
Hashemi-Rafsanjani, said in his 30 September sermon at the Tehran
Friday prayers that Iran is determined to defend its right to use
nuclear technology and it will not be intimidated into surrendering,
state radio reported. He said Iran should talk with its opponents --
which he identified as "America, Europe, and others" -- and achieve
trust. "I would like to let the [Iranian] managers in this sector
know that here you need diplomacy and not slogans," he said.
Hashemi-Rafsanjani called for prudence, patience, and wisdom, while
avoiding provocations. He said this issue must be resolved while
protecting Iran's rights.
Time For 'Crisis Diplomacy'
Criticism from Rezai and Hashemi-Rafsanjani is not altogether
unexpected. They were Ahmadinejad's rivals in the presidential
election. Rezai may have expected a cabinet post or Supreme National
Security Council position in exchange for his stepping out of the
presidential race at the last minute. Furthermore, the 49- year-old
Ahmadinejad's blunt, confrontational style is very unlike that of
the much older and more pragmatic Hashemi-Rafsanjani.
But there has been criticism from other corners as well.
Tabriz parliamentary representative Akbar Alami, who serves on the
Foreign Policy and National Security Committee, said of the Supreme
National Security Committee: "People who until very recently did not
have any knowledge about the nuclear dossier and did not even know
what nuclear energy was have now become high-ranking experts in the
nuclear dossier of the Islamic Republic of Iran." He also criticized
some of his colleagues in the legislature, "Aftab-i Yazd" reported on
29 September. He accused some parliamentarians of trying to block
discussion of the nuclear issue, saying they are acting on behalf of
the Supreme National Security Council.
A commentary in the pro-reform "Sharq" on 2 October noted
that Iran is facing an "atmosphere of distrust" in the international
arena. The Ahmadinejad administration's eastward-oriented foreign
policy has proven to be ineffective in the nuclear case, the daily
continued, so "the diplomatic apparatus should understand
international realities and distance itself from the Security Council
tsunami." The commentary also recommended the creation of a
"crisis-diplomacy team."
An editorial in the hard-line "Resalat" daily on 29 September
also commented on the needs of the foreign-policy team. It noted that
the diplomats need a "guidance council" or a "thinking room"
(presumably, a foreign-policy think tank). "Resalat" said diplomats
and politicians do not have the time to study the issues they must
deal with because of their workloads, while researchers and scholars
are somewhat out of touch with the realities of diplomacy. "The
establishment of a thinking room can bring the areas of operations
and research closer together and create balance and equilibrium and
make up for the research shortcomings and weaknesses in the area of
foreign policy."
No Obvious Effect
Ahmadinejad has evidently not been touched by such criticism.
In a 5 October speech he said Iran is not opposed to negotiations on
the nuclear issue, state television reported. But he added that Iran
will not accept negotiations that are meant to deprive Iranians of
their rights. Ahmadinejad said European countries other than the
so-called EU-3 (France, Germany, and the United Kingdom) have shown
an interest in discussing the nuclear issue with Iran, and these
proposals are under review. Turning to the country's foreign
policy in general, Ahmadinejad said Iranian diplomats defend the
country's rights confidently.
Iran's current position on the nuclear issue should not
be attributed to Ahmadinejad alone. Even before his inauguration
Tehran made it clear that all the regime's leaders have a common
view on nuclear policy. Furthermore, Ahmadinejad is not the only
decision maker on the nuclear issue. Other top officials of the
regime -- including Hashemi-Rafsanjani and Rohani -- contribute to
the process and Supreme Leader Ayatollah Ali Khamenei has veto
authority over his actions. Finally, Tehran has been fairly
forthright for some time on what it sees as its right to master the
complete nuclear-fuel cycle. (Bill Samii)
FOREIGN MINISTER VISITS SOUTHERN NEIGHBORS. Foreign Minister
Manuchehr Mottaki visited Iran's southern Persian Gulf neighbors,
regional news agencies reported on 3-5 October. He arrived in Kuwait
City on 3 October and was received by Prime Minister Sheikh Sabah
al-Ahmad al-Jabir al-Sabah. He also met with National Assembly
speaker Jasim al-Kharafi.
On 4 October, Mottaki arrived in Manama, Bahrain, and was
greeted at the airport by his Bahraini counterpart Sheikh Khalid bin
Ahmad bin Muhammad al-Khalifa. He later met with King Hamad Bin Issa
al-Khalifa, Prime Minister Sheikh Khalifa bin Salman al-Khalifa, and
Deputy Prime Minister Sheikh Muhammad bin Mubarak al-Khalifa.
On 5 October, Mottaki arrived in Muscat, Oman, and was
greeted by Foreign Minister Yusuf bin Alawi. Mottaki arrived in the
city of Al-Ain, which is 140 kilometers from the United Arab Emirates
capital of Abu Dhabi, on the evening of 5 October. The main topic of
discussion during all the visits was the nuclear issue, as well as
Iraq and Palestine. Qatar was the last stop on the trip.
Mottaki was scheduled to visit Saudi Arabia, but an anonymous
Iranian Foreign Ministry official told IRNA on 5 October the trip has
been postponed, although he did not give a reason.
Mottaki returned to Tehran on 7 October. At Tehran's
Mehrabad Airport, he told reporters he made the trip because
President Mahmud Ahmadinejad gives priority to expanding relations
with neighboring states, IRNA reported.
Mottaki ascribed cancellation of the Saudi visit, as well as
one to Syria, to scheduling problems. He went on to say there was no
plan to visit the two countries in the first place. Mottaki said he
would visit Riyadh soon. (Bill Samii)
IRAQI PRESIDENT: NO IRANIAN INTERFERENCE. In an RFE/RL interview in
Prague on 5 October, Iraqi President Jalal Talabani dismissed the
possibility of Iraqi Shi'ite Muslims being loyal to Iran, Radio
Farda reported. Talabani said the Shi'ite brethren are Iraqi and
Arab, and the Shi'ite "Vatican" is in Al-Najaf and Karbala. From
the day Saddam Hussein was deposed, Talabani said, no hostility or
interference on the part of Iran has been seen. Turning to the
Mujahedin Khalq Organization (MKO), an armed Iranian opposition group
identified as a foreign terrorist organization by the U.S. State
Department, Talabani said the MKO is the only Iranian group that
cooperated with Hussein's regime against the Iraqi people, Radio
Farda reported. However, he added, the MKO's current situation is
not problematic. (Bill Samii)
EXPERTS SAY INFRARED BOMBS USED IN IRAQ CANNOT BE HOMEMADE. The
diplomatic row continues between Britain and Iran over British
officials' charges that there is a link between Iranian elements
or Hizballah with new explosive devices being used by insurgents in
Iraq. The sophisticated devices have killed eight British soldiers
since July, but Iran has denounced the British allegations of its
involvement as a lie. British military experts maintain, however,
that only precision-geared military supply factories can produce the
"infrared" bombs also supplied by Iran to Hizballah in Lebanon. And,
British officials say, the evidence still points towards Iran,
despite Tehran's repeated denials. The experts spoke after British
Prime Minister Tony Blair warned Iran on 6 October not to interfere
in Iraq.
Amyas Godfrey has served in Iraq and heads the U.K. Armed
Forces Program at the Royal United Services Institute. He said that
it is usually easy for experienced experts on the ground to say which
group is capable of what kind of bomb attack, including the type of
explosives and packing.
The bombs in question are the "infrared trip-wire" devices
capable of piercing heavy armor. They are exactly the sophisticated
type that has been used by the Iran-funded Hizballah militias in
Lebanon.
"It's a very basic intelligence analysis," Godfrey said.
"We know who's been using them before; we know who's supplied
them. And that's not any doubt. The worry now is that they've
appeared in southern Iraq, being used by insurgents. So, logically,
it's looking like these same weapons are being supplied by the
same people."
Many other military experts share this view, including Bruce
Jones, a security policy adviser to NATO in London. He said a number
of intelligence reports as well as the nature of the devices trace
the bombs to Iran because of three basic facts.
"They have been used in the area in southern Iraq adjacent to
Iran," Jones said. "They are of a type used by Hizballah. And, you do
need a pretty sophisticated set-up, both to procure and to adapt
these technical components."
The last point appears to matter most, Godfrey agreed. That
is: The manufacturing of the components for the bombs is simply
beyond any production capacity the insurgents might have at their
disposal.
"What we're seeing now, are far more military hardware,
and something that requires a manufacturing set-up as in factories,"
Godfrey said. "It's a large amount of high explosives, a shaped
charge, which is quite common in some RPGs [rocket-propelled
grenades] or in armor-piercing weapons."
Godfrey explained that this high-precision charge melts a
hole, for example in the armor plate of a tank, and explodes inside
it. This is why it requires a high-quality manufacture, not something
that could be done in an insurgent hideout.
Jones stressed that another significant feature -- also far
beyond the insurgents' production capability -- is the infrared
"trip-wire."
"It's very much the same concept that you have of
alarms," Jones said. "An infrared beam goes between two points in a
museum, and if that is interrupted, then an alarm goes off."
Godfrey added that the intelligence services have also
gathered a lot of evidence from the attacks on British troops. He
said he doubts, however, whether -- because of its nature -- the
intelligence services would reveal this kind of evidence to the
public.
"Looking through intelligence assessments of these eight
attacks, they all have links to the Hizballah-type explosives,"
Godfrey said. "Unless they have other proof, which we won't know
about, through their security or their intelligence, all we have now
is a likelihood -- i.e., that it is likely that these bombs have come
from Iran, because they are the same type that have been used
before."
British Prime Minister Tony Blair yesterday warned Iran not
to interfere in Iraq. Blair said the nature of the bombs being used
against British troops "lead us either to Iranian elements or the
Hizballah because they are similar to devices used by Hizballah that
is funded and supported by Iran."
But Blair stopped short of explicitly accusing Iran of
supplying the bombs to Iraqi insurgents. "We cannot be sure of this
at the present time," Blair said. (Jan Jun)
************************************************** *******
Copyright (c) 2005. RFE/RL, Inc. All rights reserved.
The "RFE/RL Iran Report" is a weekly prepared by A. William Samii on
the basis of materials from RFE/RL broadcast services, RFE/RL
Newsline, and other news services.
Direct comments to A. William Samii at [email protected].
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