Economic Equilibrium

With some 27,000 private shareholders PIIC has succeeded in attraction of the people’s capital

Ali Ashraf Afkhami, managing director of Petrochemical Industries Investment Co. (PIIC), has studied both engineering and management and has over 25 years of experience in the field of petrochemical and other areas. He has been the PIIC’s managing director for the past two years. His comments on the role of petrochemical industry on the economic growth of the country follow:

In order to overcome economic difficulties, the Islamic Republic of Iran needs to adopt and implement transparent and new strategies, which would allow the country, among others, to provide new job opportunities for the youth population. According to recent statistics, 800,000 young people enter the Iranian job market annually.
No doubt, the discovering of capabilities and utilizing them, which should involve public participation with respect to inefficient government structure, needs innovation and creativity.
It is crystal clear that investment in job opportunities cannot be done only by the government, especially if instead of “policy-making and managing affairs”, the government tries to “implement and supervise projects”. That’s where the significance of the role of people, private sector in particular, would become obvious. This sector can leave a positive impact on the growth of the country’s economy.
Let’s have an example: In a comparison between a bicycle and a tricycle, one may conclude that a tricycle is balanced and stable, and needs only pedaling for moving. In comparison, a bicycle’s equilibrium should be maintained while pedaling. Private sector is like a bicycle which exerts more efforts for moving forward and at the same time, it keeps the equilibrium. The inventor of the bicycle tried to economize on one wheel, while teaching the science of maintaining the balance. In other words, the dynamism and evolution of every system depends on thinking, innovation, system building, guidance and effort.

Petrochemical Industries Investment Co.:

The company was established eight years ago and its achievements, which should be considered as the product of teamwork, include the following:

*It was set up with a capital of $60,000 and its returned investments have been increased over 520 times, more than $31 million. According to PIIC’s plans, its capital would reach $42 million in one year, which is 700 times more than its initial capital.
*The share of the government in the PIIC has been purchased by the PIIC and the former state-run enterprises have been privatized, such as Abadan Petrochemical Co., Farabi Petrochemical Co. and Carbon Iran. These companies, through using new management styles, have achieved high productivity and profitability. That is the reason behind the increase in their stock prices.
*The shares of PIIC have been allowed to be traded in Tehran Stock Exchange and now about 40% of the company’s shares belong to 27,000 private shareholders. This is an indication of the company’s success in attraction of the people’s capital.
*The PIIC has set up some companies in order to offer services in technical and engineering fields. These companies play a significant role in maintenance and renovation of various petrochemical units. For example, large projects for repairing of Bandar Imam Petrochemical Complex, Tabriz Petrochemical Company and Khorassan Petrochemical Company, and also implementation of methanol project in Kharg and Propylene in Tabriz have been undertaken by those companies.
*Of other achievements of the PIIC is investing in new projects. An interesting point regarding these investments is that the financial resources have not been government forex, but it has been made through receiving loans from foreign sources and “paying back through the sale of products in the future.” With such a successful pattern Tabriz propylene project was completed in 30 months with a capacity of 50,000 tons. Also based on the same scheme a project for the production of MTBE, with a capacity of 50,000 tons annually and in harmony with environmental standards would be implemented this year [the product of this project would replace lead in petrol] and this would be inaugurated in 18 months.

Modern Management Styles:

The impacts of such styles would cover a wide range but some of the most important ones are as follows:

*Building trust and attracting the capitals of the people using these resources properly, while these productive capitals can create job opportunities for the young people.
*They help promote creative and professional management in the country and, while building self-confidence, they prepare the ground for modeling and making systems based on modern styles.
*They allowed the government to use financial and forex resources, based on its priorities in order to reach important goals. Meanwhile, they helped strengthen the substructures necessary for the country’s development. This would help the government to play its role in policy-making, planning and guidance more effectively. As a result, a constructive, creative and good morale has created and this would strengthen the economy and increase the welfare of people from all walks of life.