KERMANSHAH -- Minister of Industry Eshaq Jahangiri said here Tuesday that Iran' economy will face daunting challenges in the next 20 years, IRNA reported.

Speaking at an international investment seminar, he added that the government and the people should prepare themselves to face this challenges and 'opt for appropriate solutions'.

"The young population and unemployment are two of the challenges," Jahangiri underlined.

He said the young population mix of the country could be a boon or conversely it could pose a danger if not dealt with appropriately.

He pointed to creating more opportunities for women and the youth as two of these challenges.

Another challenge is an economy dependent on oil 'which has shown not to be a no guarantor of socio-economic developments in other oil-rich nations', the minister added. The government's drive to meet targeted budget funds by revising the taxation system has so far failed due to the decline in the share of tax revenue in total state earnings, reported `Iran Daily' last week

Despite the government's serious efforts to reduce the government budget's heavy dependence on oil revenues, crude still constitutes a major portion of its assets, said Deputy Governor of the Central Bank of Iran (CBI) Akbar Komeyjani at the monthly meeting of the Association of Iran Economic experts.

"The share of oil sales in state earnings grew from 56.8 percent in 1991 to 62.1 percent in 2002," Komeyjani said, as quoted by the daily.

"Last year (March 2002-03), the average price of oil grew by 20.3 percent per barrel compared to that of the previous year, while at the same time the volume of exports also jumped by an average 9.1 percent," pointed out the official, adding that the considerable rise in imports was a factor in the country's unfavorable trade balance of '$5.8 billion between March 2001-02 to $4.4 billion last year'.