In recent days, candidates have turned some of their campaign promises to the steel market. This issue has been either directly or indirectly related to the steel market. In this memo, we will introduce these views and evaluate the most important ones. Candidates promise about the economy and the steel market could reveal a vision for the future of Iran’s industrial economy. We will deal with this issue in the following. Please be with Artan Press.
*** Candidates promise to improve the steel distribution chain
Mohsen Rezaei, the candidate for the 13th presidential election, has recently spoken about the problems in the steel supply and distribution chain. Regarding the forms of steel distribution, he said that the mistake that this government did was to put steel on the commodity exchange in order to create competition in this area. But few people buy the amount of goods offered and sell them at a higher price outside the stock market. It seems that the promises of the candidates regarding the commodity exchange and the stock exchange will have the greatest impact on the current steel market. He called this problem a painful story of the Iranian market and stated that in this regard, the Iranian economy should be judged. .
*** Candidates promise regarding the organization of the commodity exchange
We attach the promise of the candidates in the field of steel to the words of Mr. Raisi. Raisi recently pointed out that given the damage done to the new entrants to the stock exchange, we must first see why the stock exchange did so. Therefore, one of the promises of this candidate is to reorganize the structure of the Iranian stock exchange. According to him, awareness raising should be done in a balanced way and the distribution of rents in the country in the Commodity Exchange and Tehran Stock Exchange should reach zero. Second, the stock market needs oversight. The third point is that the government should not solve its budget deficit from the stock exchange or withdraw so much from the stock exchange. These promises are currently only hypotheses.
*** Creating insurance for loss-making shareholders on the Tehran Stock Exchange
Another issue that can be clarified in the promises of the candidates, and especially in the speeches of Mr. Raisi, is that in their opinion, in the stock market, to some extent, an active insurance should be created for small shareholders. This may be challenging in practice. The costs of this insurance must be specified from what source it is to be spent. If this approach is implemented, which, of course, with the current market conditions, it seems unlikely, the risk-taking and willingness of capital to enter the stock market will increase. If the Stabilization Fund and the Development Fund help, the losses of small shareholders can be prevented from fluctuating.
Candidates promise in the field of housing
Another issue of the candidates’ promise can be focused on advancing the goals of the future government in the field of housing. In this regard, Raisi has promised that we will have economic drivers like housing, and we must create one million housing units every year. According to him, housing, like a locomotive, drives the economy. If this slogan also becomes a practice, the steel market will benefit greatly from the housing market boom. Of course, this has many challenges.
With rising global steel prices and the elimination of liquidity from society, there is no power left for builders and buyers to thrive in the housing market. The study of production statistics (preliminary) of selected mining goods and mineral industries indicates the production of 2 million and 620 thousand tons of crude steel in April 1400 and its growth of 17.1 percent compared to April 1999. Official statistics of the Ministry of Silence show in In the first month of 1400, 70 mineral exploration licenses were issued in the country. Despite this growth, the housing market is in a severe recession.
*** Promises of candidates in the field of currency
What is certain is that the new government must compensate the trade unions and activists in the private sector in various sectors, including tax and insurance, and… part of the financial losses inflicted on this group in recent months. Candidates’ promises must be in line with current market and business conditions and people’s purchasing power.
In the most optimistic case, half power could have an immediate impact on the industrial markets and the country’s economy. Dr. Hemmati, the Central Bank, yesterday, referring to the supply and trading performance of the dollar in the Nima system, said that we are witnessing an oversupply in the Nima system. It will be kept confidential from the public due to sanctions. This is an example of creating an atmosphere in the foreign exchange market and a blow to steel transactions.
*** Government support for private enterprises
Unfortunately, we are currently facing a situation in which the public interest is not served due to the government’s support for some agencies, institutions and companies, or even the intentionality of some officials and ignoring the rights of a large group of business activists. And this issue has caused us to see decisions with rent and golden signatures in some economic sectors in the country. Meanwhile, the next president is expected to be very careful in discussing the conflict of interests of government agencies.
*** Candidates promise to support the private sector
Another point that is very important in the current situation is that it should be announced that the future government has a plan to reduce the government’s share in the economy as well as the private sector in economic decisions or that it intends to reduce the small share of the private sector as wealth producers. For the country also reduce. That’s at a time when everyone knows full well that alone
The way to cure the pain of the country’s economy is the private sector. What is expected of the future government is to allow the economic problems to be solved with the direct opinion of the private sector and for some non-experts to impose some utilitarian decisions on its body.
*** The role of the dollar in the future of the commodity market
The issue of exchange rate transparency also has a negative effect on exports, because traders are worried about the devaluation of their rials after buying goods inside and exporting them. This reduces the currency to Nima and creates the conditions for the growth of the dollar. Failure to provide a clear picture of the exchange rate (at least the central bank program) also puts pressure on the capital market and the stock market. Commodity companies account for more than 70% of the value of Tehran’s stock market, and their selling price is directly dependent on the dollar / rial exchange rate, and the lack of exchange rate transparency will cause market tension and investors to leave.
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