President Hassan Rouhani said the investment arm of Iran’s main social security provider must be privatized as part of a wider effort to scale back inefficient public-sector involvement in the economy.
“The promise I have made to the parliament and people is that next year will be the year of privatization of large companies, including Shasta,” Rouhani said on Monday, according to the state-run Iranian Labour News Agency. The company’s formal name is Social Security Investment Co. Iran’s new calendar year begins March 21.
Shasta has investments in pharmaceuticals, oil and gas, steel and cement. After international sanctions against Iran were lifted in 2016, the company said it was seeking foreign partners to help manage and expand $15 billion of assets in addition to selling stakes in almost half of 120 companies in its portfolio through public offerings or private equity investments.
Those plans received a major setback last year as President Donald Trump reimposed sanctions after pulling the U.S. from the 2015 multiparty nuclear accord to isolate and weaken Iran. European nations have developed a funding mechanism to try to salvage trade and investment with the Islamic Republic but it’s unclear if the protections it offers will reassure nervous investors.
Conservative opponents have also opposed Rouhani’s proposals to limit the economic footprint of sanctioned military entities such as the Revolutionary Guards Corps, a powerful military organization that controls a wide range of companies. The Iranian president says his bid to develop the private sector is backed by Supreme Leader Ayatollah Ali Khamenei.
The “worst economy” is one dominated by semi-governmental institutions, Rouhani was quoted by ILNA as saying.