Seeds of opportunity lie in Iran’s dormant mining sector
Optimally located along the Alp-Himalayan Mountain range, Iran is extremely well endowed with most minerals and fossil fuels. Currently, more than 3,000 mines of iron ore, coal, copper, lead, zinc and limestone, operate throughout the country, according to Mashhad Khorasan newspaper.
Investment in the Iranian mining sector holds great promise to the Iranian nation. According to the spokesman for Iran’s Committee on Industries and Mines, Bohluli Qashqa’i, proper investment in the mining industry could result in it capturing more than ten percent of the nation’s GDP. Moreover, such investments would create a significant number of new jobs, thereby further aiding the nation’s economy.
However, in reality Iran’s mining sector currently accounts for only one percent of the country’s GDP, while exports from the sector constitute a mere 0.6 percent of worldwide mining exports.
Numerous factors have hindered maximal utilization of the country’s vast resources. The Iranian government presently holds a monopoly over the industry, retaining more than 70 percent control over production. The private sector, both local and foreign, currently has no real means of tapping into this great potential.
Several measures are considered for allowing expansion of private sector activity within the Iranian mining industry. One much-needed step in this direction would be amending the Iranian constitution, as it presently limits the ownership of all large mines to the government.
Iranian officials have begun realizing the great potential of foreign investment in passing vital technological expertise to its mining sector. "Iran's share of world mineral production currently stands below 1.5 percent, while it should be between two and four percent," Deputy Minister for Mining Affairs Ja'far Sarqeini was quoted as saying by the official Iranian news agency, IRNA. "From now on, Iran should focus on exporting minerals to be able to compete in the world markets," he said.
In an effort to gain a suitable position in the world markets, Mohammad-Reza Bahraman, the head of Iran's Stone Association, told IRNA that the association intends to devote its energies to the establishment of databanks, holding exhibitions in Iran and abroad, and the creation of research centers.
In the meantime, the possibilities for investors, as well as for Iran as a nation, remain only future glimmers. ― (MENA Report)
© 2001 Mena Report (www.menareport.com)