Iran's Ahmadinejad slammed over subsidy plan

AP News
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Posted: Nov 01, 2010 2:08 PM
Iran's Ahmadinejad slammed over subsidy plan

Iran's opposition leader said the country's president would be unable to successfully implement a plan to slash energy and food subsidies, cutbacks that experts have argued will only compound Iran's economic troubles.

Mir Hossein Mousavi was quoted by a prominent opposition website as saying that President Mahmoud Ahmadinejad's government has sidelined experts who would have been key to enacting the plan aimed at saving the government billions of dollars by bringing prices of key commodities more in line with international norms.

"Generally speaking, no one is against the subsidy cut plan, but our view is that there is no (competent) figure to manage this plan," Mousavi was quoted as saying in a post Monday on sahamnews.org. "Most prominent and competent experts have been sidelined."

Mousavi also criticized the government for stationing police and security forces around the Iranian capital before the implementation of the subsidy cuts. He said the heavy security presence was intended to intimidate Iranians.

"It's not an art to position forces in 2,000 points in Tehran for implementation of subsidy cut plan," he said.

The presence of more police on the streets could be a result of routine variations in deployment levels, but the opposition believes it is a show of force intended to deter any unrest in reaction to the cuts.

In October, police chief Gen. Ismail Ahmadi Moghaddam said enemies of Iran are planning to use economic pressure to foment "civil disobedience, riot and chaos."

In 2007, people poured into the streets at night and burned several gas stations after the government introduced gasoline rationing.

Iran has been importing fuel due to its lack of refining capacity. In recent months, however, officials have asserted that Iran has achieved self-sufficiency in fuel production by modifying petrochemical complexes.

Ahmadinejad has been criticized for his handling of the economy, with opposition leaders saying he squandered much of the country's oil wealth on populist projects.

Experts say the subsidy cut plan could stoke inflation unofficially estimated to be over 20 percent. In addition, they are widely seen as placing added burdens on Iranians, whose country is already weighed down by sweeping international sanctions. Mousavi, according to the website, said the sanctions were enacted because of Ahmadinejad's "adventurist" foreign policy.

"An adventurist foreign policy has prompted the issuance of several international resolutions against our country within a short period of time that have negatively affected people's ability to earn a living," Mousavi was quoted as saying.

Mousavi said poverty and unemployment were rising and the closure of factories has led to an inundation of imports _ all signs that Iran's economy has been weakened.

"The continuation of this dangerous trend can lead to the collapse of the (ruling) system," he was quoted as saying.

Iranians enjoy some of the cheapest gasoline prices in the world even though their country _ despite having some of the world's largest oil reserves _ was forced until recently to import refined fuel.

Under the current rations system, they pay $0.38 per gallon ($0.10 per liter) for the first 100 liters (26.4 gallons). Any additional gasoline costs $1.50 per gallon ($0.40 per liter).

The new law would gradually strip away subsidies to bring the prices closer in line with international market prices. The plan is expected to be implemented over in a few weeks, but officials have declined to give a specific date.