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Prez presents budget without numbers!


President Ahmadi-nejad presented his draft budget for the new year to the Majlis Sunday and somehow managed not to mention how much money he was requesting.

In a vague speech that lacked the main details normally contained in a budget speech, Ahmadi-nejad twice boasted of how transparent and clear the budget was.

He called culture "among the most important features of the budget" and said he had given major attention in drawing up the budget to "improving the moral atmosphere, strengthening unity and national identity, promoting religious values and boosting the foundation of the family and the role of women."

He announced that the budget he was proposing for the Persian year beginning at Now Ruz was 6.6 percent larger than this year's budget. He said that as inflation in the next year is estimated to run at 10 percent, his budget actually represented a cut in spending in real terms.

But he didn't say whether that 6.6 percent growth applied to the total budget or to government's operating budget. In addition to the operating budget, there is a development budget and a budget for state owned firms folded into the total budget.

The Mehr news agency said the total budget--all three components taken together--came to 3,680 trillion rials ($368 billion) and was 32 percent larger than last year.

Majlis Speaker Ali Larijani reminded the president that the budget was late. He said it was due to be delivered December 6 and now deputies would be hard-pressed to complete their review by Now Ruz.

In opening his speech, Ahmadi-nejad said, "Thank God, the situation in the region and the world are changing in favor of the ideals of the Iranian nation. Iran is quickly turning into a center of inspiration and a model of resistance and freedom." This is a popular theme with Ahmadinejad.

But he added a new claim Sunday, saying: "Iran has now reached its highest plateau in the past 250 years." That compared his Administration with the reign of Nadir Shah (1729-1747), the last great warrior king of Persian who conquered the tribes of Iran, then defeated the Ottomans and the Russians and took his army on an invasion of India, from which he brought home the Pea cock throne and many of the jewels that fill the vaults of the Central Bank.

Ahmadi-nejad said he would lower inflation within two years to 5 percent, which would be the lowest figure since the revolution. He promised 8 per cent annual growth, which is the figure for each year in the new five-year plan that also takes effect on Now Ruz. But Iran has not reached 8 percent growth in any recent years.

The president also pledged to complete unfinished development projects. The government dating back to long before the revolution, has the habit of start ing more projects than it can handle. Twelve years ago on taking office, President Khatami as sailed the practice and promised not to start new projects until old ones were done. Four years ago Ahmadi-nejad made the same observation and promise on taking office. Sunday, he said he had cut the average time for project completion from nine years to seven years, but acknowledged that wasn't very good. "We have to reduce it to about three years," he said.

He said tax revenues as a portion of gross domestic pro duce was due to rise from 6 per cent this year to 7 percent next year on its way to the goal in the five-year plan of 10 percent. Tax revenues in the United State exceed 20 percent of GDP and in many European countries exceed 40 percent. Iran remains heavily dependent on oil sales, which provide about half the state's revenues.

But the president never said what total revenues are this year or would be in the coming year, statistics normally given in a budget speech. "The government was under pressure to keep the budget balanced this year," he told deputies. But he didn't even say if the budget was balanced.

Still, he said, "I would like you to know that the budget submitted to you is totally transparent. There are no complications or opaque points in the budget. The budget is completely clear and purposeful."

He announced that the budget authorizes the issuance of international bonds in the coming year to a total value of 9.5 billion euros ($13.4 billion), which comes to far more than all the bonds ever before issued by the Islamic Republic.

News reports said the budget calculations were based on an assumption of an average price of $60 a barrel over the coming year, compared to an assumption of $37.50 a barrel in the current year's budget.

Normally, Iran has chosen conservative numbers for the oil price assumption in the budget. But Ahmadi-nejad has not been so conservative. When $37.50 was adopted for this year, the price was around $40, although it ended with at an average of $61.06 for 2009, so the budget has faced no trauma. The president has fixed on $60 for the coming year while an OPEC barrel sold for $74.83 Monday.

Ahmadi-nejad also said that the total number of state-owned firms was now 458, down from 497-although he failed to say when the number was 497.
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Title Annotation:Economy
Publication:Iran Times International (Washington, DC)
Date:Jan 29, 2010
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