TEHRAN -- Minister of Economy and Finance Tahmasb Mazaheri said here Saturday that the U.S. war on Iraq will definitely affect Iran's economy, but government has adopted necessary mechanisms to offset the harmful impacts.

"Since the Islamic Republic of Iran is engaged in exports and imports worldwide and given the war's overall impact on global economy, Iran's economy will be affected by the event," said Mazaheri in an exclusive interview with IRNA.

Mazaheri said the government has adapted series of mechanisms to control liquidity, price of commodities and meet financial cost so as to prevent inflation and price hikes resulting from the war.

The minister said influx of Iraqi refugees to Iranian borders and higher shipping insurance cost in the Persian Gulf would relay shocks to Iranian economy thus weakening it.

He said that however, rule of the thumb relieves any sort of concern over the mishap because Iran's policy has been based on active neutrality, including in the military domain.