TEHRAN – Head of the Iranian Economy Ministry’s Production Financing Facilitation Center Majid Karimi says production-oriented investment and financing production units are the main requirements for achieving the country’s 8.0 percent economic growth target.

The country’s 7th National Development Plan has targeted an average growth of eight percent for its five-year period, and one of the most important requirements for achieving this growth is capital formation and investment in the productive sectors, and financing has a very direct relationship with investment,” Karimi said in a televised interview.

“In general, there are two ways of financing in the economy, either from internal sources which means from the profits of the entity itself or from external sources which includes both the banking system and the capital market,” he added.

“Considering that the country’s economic growth in the last decade was below one percent and the ratio of capital formation to the country's capital stock was also following a downward trend, the parliament and the government had to create new legal and executive platforms to finance production in order to compensate for those drawbacks. To this end, drafting and approving the production financing law was put on the agenda,” the official said.

According to Karimi, the mentioned law has been recently approved by the parliament and following its approval, the Economy Ministry is also getting the necessary basis ready to implement the mentioned law to the fullest.

“When the law was approaching its final stages, the Ministry of Economy also updated its mechanism in accordance with that law in order to prepare for the implementation of this law and increase the required speed of action,” he said.

The Economy Ministry’s Production Financing Facilitation Center was inaugurated in Tehran on Tuesday, in a ceremony attended by Economy Minister Ehsan Khandouzi.

EF/MA