June 20 - 26, 2005



The Iranian electorate turned out en masse Friday last for the most hotly contested presidential election in the history of the Islamic Republic, which will set the tone for the next four years.
In the close competition, no candidate may receive the 50 percent of the vote required to avoid a second round runoff election between the first and second place presidential hopefuls. In the eight previous elections in the history of the Islamic Republic, the president was always elected in the first round.
This year's presidential election was unique. Seven candidates with different outlooks on political, social, and economic policy competed for the post. This is the main reason why the election may go to a second round.



Every voter who turned up at the polling stations to cast a ballot found that his/her views were represented by at least one candidate. People could vote for a reformist, a moderate reformist, a moderate centrist, or a conservative in a true manifestation of democracy in which all citizens, with their various political, economic, and social attitudes, have a voice. However, all will have to accept the decision of the majority.

An interesting development in this election was the fact that all candidates advocated some kind of reform, whether it was the reformism of the Second of Khordad Front, whose votes swept President Mohammad Khatami to power in landslide victories in 1997 and 2001, a moderate variation of this type of reformism, or the new phenomenon of reformist conservatism. Clearly, the process of reform cannot be stopped. The 2005 presidential campaign showed that the nation is on the right path to democracy and that with each election it is moving toward democratic maturity.

There were many points of contention in this election, but the people's concern about the state of the national economy and the average citizen's standard of living was a key issue.

Due to large population growth in the early years of the revolution, the country is dogged by high inflation and high unemployment, and voters are desperate for a president who can put the economy in order.

Iranians also had to deal with foreign interference in this year's presidential election.

Several months before the poll, groups opposed to the Islamic Revolution, mainly based outside the country, and the U.S. administration began urging Iranians to boycott the election. However, Iranian voters foiled their plot.

On the eve of the election, the U.S. president and his secretary of state made undiplomatic and interfering statements against the Iranian nation. In a statement released by the White House, George W. Bush said: "Iran is ruled by men who suppress liberty at home and spread terror across the world. Power is in the hands of an unelected few who have retained power through an electoral process that ignores the basic requirements of democracy." Bush also said the U.S. would stand with the people of Iran when they stood up for his version of "freedom".

Condoleezza Rice said the Iranian political system is moving backwards.

But what really happened on the ground? Through their high turnout in the poll, the people made it clear that Bush and Rice and the rigid-minded opposition do not really understand the Iranian nation. The citizens of the Islamic Republic showed the world that, contrary to Rice's remarks, they are looking to the future and moving forward.

The people have once again proven that they believe in their truly home-grown democracy and are not influenced by foreigners and those who ruled them harshly before the victory of the Islamic Revolution in 1979

Millions of people went to polling stations throughout Iran on Friday to cast their ballots in the presidential election. Polling was set to end at 7 p.m. but was extended by two hours due to high voter turnout.

Supreme Leader of the Islamic Revolution Ayatollah Seyyed Ali Khamenei said that voting for any of the candidates in the 9th presidential election is a vote for the Islamic system. After casting his ballot at the Imam Khomeini Mosque in northern Tehran, the Leader told reporters, "When we come to the polling stations to cast our ballots according to the Constitution, it means that we are voting for the Islamic system."

The Supreme Leader expressed hope that the next president would be able to solve the country's problems and meet its needs.

In reference to the treacherous moves of some Western states aiming to prevent Iranians from participating in the poll, Ayatollah Khamenei said that such measures have nothing to do with the general concept of Western democracy.

"Some of our enemies do not like to see an Islamic system which can both maintain its religious nature and rely on the votes of its people at the same time," the Supreme Leader added.

"They are more interested in seeing Islam as a religion incapable of establishing a real democracy," argued Ayatollah Khamenei.

Since the existence of a religious democratic system is against their interests, the enemies of Islam and Iran can not tolerate such a phenomenon in the country, he observed.

A propaganda campaign has been launched by the enemies which has nothing to do with the world of democracy, the Supreme Leader said, adding that any democracy-seeking people would be happy to witness a democratic system in any corner of the world.

President Mohammad Khatami said after casting his vote, "Dissidents' negative propagation has had no effect on people's wide participation in the election.

"The level of public participation in the election is satisfactory, despite the high volume of negative propaganda preceding this election. "I hope the dynamic presence of all eligible men and women in this election will help pave the way in the difficult path toward the institutionalization of democracy in this country. That is the fruit of the Islamic Revolution. "All the same, the outcome of the election, which is the Iranian nation's choice, should and will be respected by everyone." He also expressed hope that the last election of his term of office would be a healthy and satisfactory one and that the result would secure the "essential interests of the great Iranian nation."

He also expressed his appreciation for the media's efforts to inform the public and to convey officials' messages to the people and the people's demands to the authorities.

Iranian nation will once again showcase and prove their genuine commitment to Islam, the late Imam Khomeini, and the Islamic Revolution," Majlis Speaker Gholam-Ali Haddad Adel said.

Public participation in the June 17 election also symbolized direct management of the country by the ordinary people, he added.

He stated that taking part in the election is indeed taking part in managing the country in a direct and independent fashion. "In fact, people display their love and affection for their country when they go to polling stations." After casting his ballot in the capital, Haddad Adel said that it was too early to give an accurate estimate of voter turnout, but added that the Iranian nation had time and time again surprised officials and the international community in previous elections and observed, "It is safe to state that, this time around, they will also perform their duty by participating in the nationwide event en masse and voting for their preferred candidates."


Liquefied natural gas prices may rise as new projects begin production only after 2007 and demand for gas from China and India, Europe and the US increases, Tokyo Gas Co said.

Asian buyers including Tokyo Gas and Tokyo Electric Corp may pay higher prices as producers such as ExxonMobil Corp and BP Plc divert some cargoes from Middle East and Asian projects to the US, Tadaaki Maeda, Tokyo Gas's chief executive of energy resources, said in Kuala Lumpur.

A delay in a BP-led project in eastern Indonesia and falling production from PT Badak NGL, Indonesia's biggest plant, has reduced supply, he said.

"Supply will be tight until the start of new green field projects,'' Maeda said at the Asia Oil and Gas Conference. "Prices are at $6 to $7 now and may take a while to go down to the previous level of $3 a million British thermal unit.''

The price of LNG from Indonesia was at $7 per million British thermal unit for April, up from $5.4 a year ago, according to LNG Japan Corp, a venture between Nissho Iwai Corp and Sumitomo Corp.

Indonesia is the world's biggest LNG exporter. Japan is the world's largest LNG importer, accounting for about half of the 123mn tons traded in 2003.

Tokyo Gas, Japan's biggest gas distributor, may boost its LNG imports to 10.3mn metric tons in 2008, from 9.13mn tons in 2005 and 8.9mn tons in 2004, Maeda said.

Meanwhile, an official of Petroliam Nasional Bhd, Malaysia's state-owned oil and Gas Company, said the company plans to expand the capacity for one of its liquefied natural gas plants by 15%.

The capacity of the Malaysia LNG Dua plant will increase 1.2mn metric tons a year by 2007, Mohd Suhaimi Yasin, general manager for commercial division at Malaysia LNG Sdn, a unit of Petroleum National, said in Kuala Lumpur yesterday. "We are not building a new train but we're expanding our existing two trains," Suhaimi told reporters at the Asia Oil and Gas Conference.




Iran's Minister of Oil Bijan Namdar Zanganeh has said that the country is presently exporting 60 percent of its oil products to the East Asian countries. He further said, "With regard to the increasing consumption of the crude oil by the East Asian countries, particularly China, as well as increase of demand for the WTI light oil by the European countries, Iran has changed policies on oil export."

Currently, 60 percent of the country's oil is exported to the eastern Asia, and the rest is exported to the Mediterranean, northern Europe, and southern Africa, the minister said.

Commenting on the recent decision made by OPEC to increase the production, Zanganeh stated that the decision does not have any significant impact on the organization's production, since OPEC members are using their full capacities for production. Another report also quoted Hojjatollah Ghanimifard, Deputy International Affairs of the National Iranian Oil Company (NIOC), as saying, "The European states have moved toward importing the crude oil without sulfur - the light oil - therefore, demands of these countries for the crude oil produced by the Persian Gulf states has decreased."

According to him, the European countries are predicted to hold low shares of the heavy and sour crude oils in their energy stock by 2020.

"Thus, with regard to the current conditions, the oil suppliers such as Iran have to change the policies of their markets unless the European states embark on setting up refineries for refining the heavy crude oil", he added.


An expert on carpet affairs said that Pakistan has taken full advantage of poor state support for the industry in Iran to imitate the designs of Persian carpets and export them to international markets.

Roqayyieh Almasi, a member of Scientific Association of Persian Carpet, said that Pakistani weavers make use of Iranian designs in their carpets. "They weave Persian carpets and then export them under (world-famous) Iranian brands of Haris, Afshar, Kashan, Kerman, etc. to other countries," she said, adding that poor support by the Iranian government has discouraged high-quality carpet production in Iran.

As Persian carpet production continues to decline, labor costs have gone up drastically, posing a serious threat to the future of the once thriving industry.

India, Pakistan, China, Nepal and Turkey are Iran's major rivals in the carpet industry. Experts warn that the failure to combat the smuggling of Persian rugs from Iran would place Afghanistan as the country's top rival.

The main challenge facing the industry is that Persian carpet weavers are still incapable of working in an organized manner.

Some 90% of Iran's carpets are produced in rural areas and the weavers know very little about the taste of international customers.

More than 70% of revenues from domestic sales of Persian carpets go to the weavers, while rival countries have access to far more inexpensive workforce. Persian carpets are currently exported to 100 countries.


The Islamic Development Bank, a lender formed by 55 Muslim nations, will set up a new Islamic trade financing institution to help boost trade among member-countries, its regional representative in Malaysia said.

The International Islamic Trade Financing Corp, to be based in Jeddah, Saudi Arabia, will have $1bn of initial capital, said Ahmed S Hariri, director of the bank's regional office in Kuala Lumpur. It will have a regional office in Dubai.

"The volume of trade between the member-countries is rather modest," said Hariri. "In order to increase this volume of intra trade, you need a specialized organization that will focus on trade."

Lenders including Jeddah-based Islamic Development and countries with large Muslim populations such as Malaysia are seeking to introduce more financial services that comply with Islamic law to serve the world's 1bn Muslims.

Islamic religious law, or Shariah, prohibits payment and receipt of interest and bans investment in businesses such as tobacco, alcohol and gaming.

"The trend of Islamic finance is becoming firmly anchored, and basically goes with the privatization drive in the Middle East and the building of the local capital market," Michael Preiss, a senior investment adviser at Coutts Bank (Schweiz) in Singapore, said.

Preiss, a director at the Asian Bond Market Forum, spoke on the development of Islamic bonds and Asian markets at the International Islamic Finance Forum meeting in March in Dubai.

Islamic Development, made up of all but two members of the Organisation of Islamic Conference, will ask its board of governors to approve the plan at the bank's 30th annual meeting in Putrajaya, Malaysia, next week, Hariri said.

Trade between Organization of Islamic Conference countries amounted to 11.5% of the group's total trade, according to figures provided by the Islamic Development Bank. Having a specialized entity to provide trade financing may help boost the figure to 15% in 10 years, Hariri said.

Trade financing has been handled by a department within Islamic Development for the last two decades, Hariri said. Between January 1996 and February last year, the bank provided $20.8bn in trade financing.

Malaysia is the current chair of the 57-member Organization of Islamic Conference, which includes Qatar, Saudi Arabia, Indonesia, Iraq, Iran, the UAE, Turkey, Pakistan, Afghanistan and Egypt.

The two-day meeting of the board of governors of Islamic Development will begin on June 23. An OIC Trade Forum and an investors' conference will also be held next week in Malaysia.

The bank's governors, who are finance ministers and central bankers, will discuss "issues that are facing member-countries such as globalization" and poverty. "We do realize the challenges of" the World Trade Organization market opening agreements, "so we try to help our member-states in meeting such challenges," Harare observed.

"Member-states have to develop their technical expertise, their competitiveness, the quality of their products to match the developed countries' products and services."

Islamic Development Bank will also admit a new member and discuss the election of the president. The five-year term of President Ahmed Mohamed Ali expires this year. The lender this month started marketing bonds that comply with the Qur'an's ban on interest payments as part of a $1bn fund-raising plan.

Islamic bonds are backed by assets sold to a company created by the borrower to issue the securities. The borrower then rents back the assets.

The rental goes back to investors in place of interest. On maturity, the bond seller buys back the assets at an agreed price and investors are repaid the principal.

Siemens wins $602mn Qatar and Middle East power plant

Siemens has won power-plant orders from the Middle East and North Africa worth a total of around 500mn euros ($602mn).

The orders include Siemens' first turnkey order from strategically important Qatar - where Siemens may be in the running to help build a multibillion-dollar high-speed rail link - as well as contracts to build plants in Dubai and Egypt.

In Qatar, Siemens will partner with South Korea's Doosan Heavy Industries & Construction Co to build a 1,000mw combined-cycle plant scheduled to begin commercial operation in May 2008, the German company said in a statement. Siemens' Power Generation unit will supply three gas turbines, two steam turbines and associated electrical equipment for the Ras Laffan B plant.

In Dubai, it will supply three gas turbines for a 400mw plant due to begin operating in early 2007.

And in Egypt, Siemens will supply two gas turbines and auxiliary systems for the El Kureimat power plant near Cairo.

The German company's clients are the Egyptian Electricity Holding Company and the Upper Egypt Electricity Production Company.

"Ras Laffan is the first turnkey order for Siemens PG from the fast-developing area of Qatar," Siemens Power Generation President Klaus Voges said in the statement.

"Together with the successes in Dubai and Egypt, we have succeeded in further consolidating our leading market position in the Middle East and Egypt."

German politicians who visited the region in March said Qatar and the United Arab Emirates were interested in the German Transrapid high-tech rail system, which is built by a consortium of Siemens, ThyssenKrupp and the German government.


Europe may stage the world's biggest air show, but the Middle East and India are stealing the limelight this week with multi-billion-dollar cheques for new planes.

Fast-growing economies, an influx of tourism and more open markets are fuelling unprecedented growth in demand for air travel in the regions, a bright spot for plane-makers fighting back from a post-2001 industry downturn.

While some aerospace executives privately wonder if the growth rates can be sustained, demand for air travel in some of the world's fastest-growing economies shows no sign of slowing.

Airbus chief executive Noel Forgeard according to reports has said that China and India could be the drivers of growth in the future.

In Europe the trend is good, it is excellent in the Middle East, and it's even better in Asia. Indian carriers and an airline from a small Gulf state stole the thunder from their larger European and US counterparts who stayed quiet at the biennial air show, traditionally a venue to announce big plane orders.

Doha-based Qatar Airways topped the list with a whopping $15.2bn order for Airbus and Boeing aircraft as it capitalizes on a surge in development and tourism in the oil-rich Middle East.



(Courtesy Tehran Times and PAGE sources)