More than a third of Iran's deputies, most of them conservatives, boycotted a parliamentary session Thursday over a controversial measure to make businesses reimburse billions of dollars, state television said.
The boycott by 74 deputies stopped the parliament from reaching the necessary quorum to go through with a vote on the budget.
The bill — already rejected by the conservative-controlled Guardians Council — would force businesses to pay back six billion dollars to the government because of a generous exchange rate policy introduced after the war with Iraq.
Mehdi Karubi, speaker of the pro-reform parliament, "strongly criticized" the deputies who boycotted, as reformist leaders called on everyone to show up for the Saturday parliamentary session.
The 290-member parliament needs 190 deputies to hold a session on the budget. Seventeen seats are already vacant and will be filled in June runoff elections.
The bill was "not good, not justified. It will create serious difficulties for company finances, cause bankruptcies, and therefore unemployment," said Mehdi Sahraian, director of the projects committee of the association of business leaders.
A parliamentary source said the order contained in the budget mainly affected industrialists close to the conservative camp, including bazaar merchants and powerful Islamic foundations close to the clerical regime.
Between 1989 — when the war with Iraq ended — and 1993, the government of then president Ali Akbar Hashemi-Rafsanjani allowed firms importing essential goods to benefit from a special rate for the rial against the dollar to speed economic reconstruction.
The rate, of either 300 or 600 rials to the greenback, was four or five times lower than the prevailing rate at the time.
To fund imports, the central bank set up a special account totaling $1.6 billion, but the total deficit after four years came to six billion and the central bank has demanded that the state pay it back, the source said.
The parliament, for its part, ruled in the budget that the businesspeople concerned, who number several hundred, should pay. Central Bank governor Mohsen Nurbakhsh said the move was legitimate.
Iran is on March 21, the first day of the new Iranian year, due to set one exchange rate for all transactions, and an economics expert who wished to remain anonymous said "the debate on the past conceals a fierce debate over the future."
No decision has been taken, apart perhaps from scrapping the lowest exchange rate of 1,750 rials to the dollar, the expert said. "But oil revenues, which make up more than 80 percent of the country's foreign exchange receipts, are worked out at that rate."
"A compromise must be found between 5,000 and 7,900 rials," he said, adding that there were sharp divisions among the country's economic and political leadership over what the level should be. — (AFP, Tehran)
© Agence France Presse 2001
© 2001 Mena Report (www.menareport.com)
