The Role of Social Justice in Development of Developing Countries

Transcription

1 Ministry of Industries and Mines ISLAMIC REPUBLIC OF IRAN Development of Developing Countries The China + India Factor: Implications for Developing Countries in the Asia and the Pacific Region 12th Session, Vienna; Austria, 3 to 7 December 2007 Deputy Minister For Economic & International Affairs

2 QUESTIONS What are the main forces driving rapid economic growth of China and India in Asia and Pacific Region? What is the role of FDI in the growth? What is the role of low cost labor? What is the correlation between Economic Growth and Openness, Trade Performance and Sheer Size? Is this Economic growth sustainable What are challenges threatening such Economic Growth How can we increase the South-South cooperation? Which Industries contributed to such growth? What are environmental issues in such economic growth? Do Social Justice and other Social factors have any influence in such development?

3 The potential in South and Developing Countries Substantial Energy Resources Countless Mineral Resources and Abundance of Raw Materials Low cost Labor High level of Knowledge and Technology available to meet countries' current needs World Class Educated and Trained Workforce

4 The potential in South and Developing Countries Low costs of production The magnitude of trade between South- South Countries The Large population of South countries (over three quarter of world population) To develop Main Value Added margin for global manufacturing in South countries

5 A glance to Global Brands While the Global Brands make significant amount of profits by building their products in South Countries, the South has no share in Value Added Margin. One third of world's wealth belongs to Global Brands which are located in North Countries, but making their products in South. The aggregate value of 100 Global Brands were USD1,090 billion (as to Business Week) equivalent to gross domestic product GDP of 65 countries

6 A glance to Global Brands Another words, revenue of the countries manufacturing products for Global Brands, are even lower than 1/5 of Global Brands' Goodwill. This is : Neo Exploitation Whereas, economic growth would be sustainable if human relationship excludes exploitation and repression.

7 The Win-Win Mechanism in South-South Cooperation To develop Economic Relation based on Peace and Social Justice and respect justly rights in human relations. Maintaining production cycle from raw material to the final product in South and exporting the surplus to other countries. Transfer of Science, Technology and Industry available to the countries in South, based on their needs and requirements through breaking monopoly of technology and their development in South

8 The Win-Win Mechanism in South-South Cooperation Identifying advantages of countries in terms of natural resources, energy, mines, raw materials, to exchange in between South producing countries with respect to their national interests. Participation of South in establishment of multinational corporations in various fields such as Energy, Petrochemical, Vehicle, Foodstuff, Textile, Cement, Minerals, Machinery and Equipments, to develop existing and future projects and to perform international projects if the capacity exceed the needs

9 The Win-Win Mechanism in South-South Cooperation Founding multinational Banks, Financial Funds and Insurance corporations with partnership of South to make financial contributions to large projects implemented in South and investment in production and industrial development. Allocation of funds earned from industrial development profits and economic growth yields to implement social projects for poverty reduction, contribute to diseases and pest control and prevention plans, and other Social and Cultural development projects. Forming Joint Air, Marine and Land Transportation Corporation between South for exchange of goods with preferential tariffs

10 Challenges in Cooperation of South-South Dominance of unfair and unjust relationship between South-South Formation of Commercial, Scientific, Technologic and Economic Monopolies. Inaccessibility to Financial Resources, Long Term Investment Funds and Effective Financial Institutions and Insurance industries. Lack of Infrastructure Development contributing to industrial development

11 Challenges in Cooperation of South-South Dominance of unfair and unjust relationship between South-South Formation of Commercial, Scientific, Technologic and Economic Monopolies. Inaccessibility to Financial Resources, Long Term Investment Funds and Effective Financial Institutions and Insurance industries. Lack of Infrastructure contributing to industrial development

12 Challenges in Cooperation of South-South Lack of Cultural and Social Development. Increasing trend of Disparity between rich and poor.

13 Industrial Development Strategy Macro Policies in I.R. IRAN Industrial development established by private and cooperative sectors, emphasize on public participation, in forms of private and public stock companies. Positioning Economic Policies and exploiting comparative advantages in development of competitive advantages and promoting competitive factors in industrial and mine sectors to match world standards. Positioning industrial development based on value added and competitive advantages and expansion of Export Capacity. To complete Value Added Chain in Industry, observing competitive factors and practices in global arena.

14 Industrial Development Strategy Macro Policies In I. R. IRAN Developing an effective and enduring inter-industry industry interaction to develop synergy and competitive edge in entire Industry and Mine sector Directing industries to use tools used to catch local market opportunities, for international market entry Suggesting advanced technology in industry and mine sector and establishing Hi Tech industries associated with technical and scientific enhancement. Positioning of privatization to increase performance and competitiveness Emphasize on promotion of technology in enterprises, reform the organizational culture and increase volume of investment in international market research and marketing

15 Industrial Development Strategy Macro Policies in I.R.IRAN Developing mining industry for optimum exploitation of mines and energy resources, and establishing bond in between small, medium and large industries, and setting up industrial clusters Permanent industrial development, while observing environmental consideration. Encourage foreign investment to reach and transfer technical know-how and technology, improvement of managerial and technical capabilities, and access to international markets through international marketing networks, foreign investment firms, have a reach to complementary financial resources.

16 Industrial Development Strategy Macro Policies To establish contact between local and foreign enterprises, with emphasize on reaching foreign markets and moving towards economy of scale, and shift towards higher value added activities Improvement of human resources, basic science, and expertise. Reform "industrial policy making", to view industry and trade as a whole, while focusing on influence of industrial policy on other economic sectors. To establish and empower financial and development institutions to support industry and mine sector, continuously

17 Industry Quantitative Goals on 2025 VEHICLE TOTAL Description HIGH TECH INDUSTRIES MACHINERY and EQUIPMENT ENERGY based INDUSTRIES AGRO INDUSTRIES METAL MINERALS NON-METAL MINERALS % MILLION $

18 Annual Growth Rate of (Non-Petroleum) Industrial & Mineral Exports Percentage st Dev. Plan 2nd Dev. Plan 3rd Dev. Plan

19 Reasons to Invest in Iran Iran qualifies from many respects to be a good location for investment and doing business. Some of the features are:

20 Reasons to Invest in Iran 1. Strategic Location: A unique geographical location at the cross- road connecting the Middle East, Asia and Europe, empowered by many inter-and trans-regional regional trade, customs, tax and investment arrangements; 2. Privatization Plans and Article 44 of the constitution: The result of IRAN' s development plants and article 44 of the constitution; Public companies will be privatized and some state sectors will transfer to the nonn on-state sector. 3. Market Potentials and Proximity: Vast domestic market with a population of 65 million growing steadily as well as quick access to neighboring markets with approximately 300 million inhabitants; 4. Labor Privileges: Large pool of trained and efficient manpower at very competitive costs in a diversified economy with an extensive industrial base and service sector;

21 Reasons to Invest in Iran 5. Membership of international groups/organizations (some of them are as bellow): Customs Co-operation operation Council (CCC), Economic Cooperation Organisation (ECO), Economic and Social Commission for Asia and the Pacific (ESCAP), Food and Agriculture Organisation (FAO), International Bank for Reconstruction and Development (IBRD), Islamic Development Bank (IDB), International Finance Corporation (IFC), International Labour Organisation (ILO), International Monetary Fund (IMF), International Organisation for Standardisation (ISO), Organisation of the Islamic Conference (OIC), Organisation for Petroleum Exporting Countries (OPEC), Permanent Court of Arbitration (PCA), United Nations (UN), United Nations Conference on Trade and Development (UNCTAD), United Nations Industrial Development Organisation (UNIDO), World Confederation on Labour (WCL).

22 Reasons to Invest in Iran 6. Developed Infrastructure: Territory developed networking in the area of telecommunication, roads and railways across the country; 7. Low Utility and Production Cost: Diversified range of energy, telecommunication, transportation, as well as public utilities; 8. Abundant Natural Resources: Varied and plentiful reserves of natural resources ranging from oil and gas to metallic and non-metallic species reflecting the country s s accessibility to readily available raw materials; 9. Climatic Characteristics: A four season climatic endowment as a privilege to agricultural activities throughout the country and throughout all seasons;

23 VOLUME OF FOREIGN INVESTMENTS UNDER FIPPA by sector (THOUSANDS US$) Indusrtie & Mine sectors Other Sectors All Sectors

24 No. of Foreign Investment under FIPA ( ) NO. of FOREIGN INVESTMENTS UNDER FIPPA (DURING ) Industries & Mines Other Sectors All Sectors

25 Reasons to Invest in Iran 10. Fiscal Incentives: Reduced tax rates from 65% to a flat fixed 25% rate of tax income despite various tax holidays highlighted as follows: Highlights of Tax Holidays Activity Agriculture Industry and Mining Industry and Mining in Less-Developed Areas Tourism Exports Level of Exemption 100% 80% 100% 50% 100% Duration of Exemption No Time Limit 4 Years 10 Years No Time Limit No Time Limit