Thursday, June 14, 2007

Getting Politically Polarized

Just a few days ago 57 Iranian economists wrote an open letter to President Ahmadinegad to share their concerns about the disparities between current conditions and announced targets of Iran’s 2020 vision and 4th development plan. A few of signatories in their later interviews emphasized that they are ready to assist government in any way to meet the economic challenges ahead. It seems that these economists also are concerned that some members of administration do not believe in their sincerity.

The debate over economic policies has not been limited to this letter. Iranian media have disclosed the contents of a letter written by Mr. Rahbar former head of Iran’s Management and Planning Organization (MPO) in the time of his resignation from President Ahmadinegad’s cabinet. In this letter Mr. Rahbar had warned against the policies that undermine the role of MPO, over which he disagreed with the President. The list does not end here either.

Recent weeks have witnessed a spirited debate over interest rate in Iran. After months of debate and second guessing President Ahmadinegad lowered interest rate for the banking system in Iran. This surprise move had not been expected by anyone. Just hours before its announcement Minister of Finance and Head of Central Bank were assuring Iranian bankers that interest rate would not change. Several Iranian authorities were fast to point out that lowering interest rate would not be official until it is approved by Country’s High Council for Economic Affairs. The debate is still going on.

Certainly this amount of debate in Iranian media regarding economic affairs exhibits a healthy practice of free exchange of ideas and opinions, something that one does not see often practiced in countries that USA calls allies. However it also increases the possibility of polarizing the economic debate with political affiliations in the country. Thus it might transform matters of policy to matters of principle and individual prestige. This is a dangerous transformation that could compromise country’s economic growth and sustainable development.

The task before Iranian economists is indeed enormous.

No comments: