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EghtesadOnline: The government’s revenue from selling state-owned assets was almost zero in the first half (March 21-Sept.22) of the fiscal year, a report by the Supreme Audit Court (SAC) shows.

It has been said in the budget that the Raisi administration expects to make 940 trillion rials ($3.3 billion) from divestments in this calendar year that ends in March 2022.

In a report on the government’s progress toward this goal, the SAC, which is a supervisory arm of the parliament, said that the government tried but failed to divest eight companies “because there were no buyers,” the SAC website reported.

Of the 940 trillion rials projected income for the year, the report said hardly 7.02 trillion rials ($25 million) was secured that too from divestments in previous years.   

Companies on the divestment list in H1 included giants like Esfarayen Industrial Complex, Pars National Agro-Industry and Animal Husbandry Company, Iranian Catalyst Development Company and Hegmataneh Petrochemical Company.

Names like the Isfahan Water and Wastewater Consulting Engineers Company, Shahid Abbaspour Dam and Power Plant, Wood, Metal, Plastic and Electronic Industrial Complex (aka Sima Choob owned by the Islamic Republic of Iran Broadcasting) are also on the list plus residue shares in Bank Saderat.

Earlier estimates by the Economy Ministry said 1,000 estates owned by the government are on the divestiture list.

A Tall Order

However, informed minds, prominent economists and state bodies say there is little hope that the government could realize the projected revenue by the yearend.  

In a report earlier in the month, the Majlis Research Center, said at best the government may realize 30% of the projection or 300 trillion rials.  

Earlier in the week, the newly appointed head of the Iranian Privatization Organization Hossein Qorbanzadeh concurred that Rand his men must make big changes in the privatization scheme to be able to make progress and downsize.

In a meeting with private sector leaders, he said the main problem with most of the government’s privatization plans is that it has insists on a “controlling interest” of the companies it sells.

In the same vein, head of the Iran Chamber of Commerce, Industries, Mines and Agriculture, Gholamhossein Shafe’i earlier called for rewriting the divestment rules to encourage private investors to come forward.

Divestitures are backed by Article 44 of the Constitution that promotes private enterprise, downsizing and curbing the bloated bureaucracy.

According to existing privatization laws, state and government owned enterprises fall into three groups.

The government is barred from ownership, investment and managerial posts in Group I. Likewise, it is obliged to transfer 80% of the companies in Group II to private, cooperative, public and nongovernmental sectors. Ownership, investment and management positions in Group III is the exclusive premise of the government.