TEHRAN – High interest rate, complex tax laws, inexperienced management and unskilled workforce plus thorny bureaucracy are the major hurdles to investment in Iran, Minister of Labor and Social Affairs Mohammad Jahromi noted on Sunday.

“The administration plans to reduce the current 14% bank loans to a single digit by yearend (Iranian year ending March 20, 2007). To resolve the impediments in employment, investment, agriculture and industry sectors the figure should go below 7% mark,” he said, stipulating the government has considered Rls.20,000b worth of credit for the shops capable of absorbing the unemployment insurance recipients.

“The interest-free loans set at Rls.100m are to be paid off in three years by such shops and short-term job contracts of permanent nature. They are going to be redefined by the cabinet before September 22,” the minister elaborated.

“Moreover, the industrial and production units with ‘high’ liquidity should funnel their money into 4% loan business so one may notice reduction in prices and inflation. Domestic commodities could therefore get a chance to be more competitive, paving the way for further circulation of both capital and merchandise,” Jahromi maintained, adding that this in turn will create more employment.