IBENA- Asghar Abolhassani, the deputy head of the central bank, on the second day of the 29th annual monetary and currency policy conference, pointing out the importance of working capital for businesses, emphasized: good performance in the development sector, because working capital means what is what have in economy; But is what we have enough?
He emphasized that thirteenth government has been associated with central bank and we have regular talks to prepare big plans together, adding: We are seeing a more disciplined government so that last year it settled debt to us. He has not been looking for a fund this year either. Deputy governor of central bank also stressed repayment of government's debt to central bank, adding that government should have a plan to pay off the debt over time; Either by deepening debt market or by giving us securities that we can cash in the market. By negotiating to government, we are trying to get account of treasury unit and make it realized, he said.
Referring to main causes of inflation and financial instability in last two decades, Abolhassani paid attention to share of monetary base resources from its growth and said: average annual net share of foreign assets is 27.3 percentage points, net government debt is negative 1.6, net bank debt 8.1 percentage points and other debts are negative 10.8.He also noted that liquidity has increased by an average of 28.7 percent over past 20 years; In category of liquidity, 3 issues should be separated; The first is ratio of liquidity to GDP, second is growth of liquidity in short and long term, and third is control and management of liquidity, he stated.
Deputy governor of Central Bank announced average growth rate of growth rate in last 20 years as 5.2 percent and said: Growth rate of production during this period was 2.9 percent, which is disproportionate to growth of liquidity and efforts should be made to approach this claim. We should not only focus on growth of liquidity, but also growth rate of production is very important. Result of these rates is an inflation rate of more than 20 percent in last 20 years, he said. Referring to growth of monetary base, Abolhassani said: Mechanism of oil-rich countries is such that oil has a significant impact on growth of monetary base, but of course imbalance in government and budget, and dependence of economy and government on oil is very important.
He continued: We do not have an optimal combination of government and private sector. We have a big government that needs Rials and based on that it sells oil and takes its currency and converts it into Rials. Over the past 15 years, working capital has been a key element of facilities, said central bank deputy governor. It means only maintaining status quo and not developing and upgrading.
He specified: Total facilities paid by banking network to various economic sectors last year was 29681.6 thousand billion Rials, which recorded a growth of 52.1 percent compared to 1999.: Distribution of payment facilities in category of working capital of various economic sectors in 1400 was about 65.3 percent, while this figure for creation sector is about 11.7 percent and development sector 8.3 percent was recorded, Abolhassani continued.