Banking facilities for large enterprises and rent

Regarding the impact of banks on businesses, Faryal Mostofi said: “Supporting entrepreneurs is essential for the growth of the country’s economic system.” Financing is one of the most important issues for production, service, etc. work. Investment is one of the factors that, if injected into productive sectors, in addition to helping to improve the business situation of enterprises at the micro level, can also lead to economic growth in the macro dimension. It is necessary for the government to formulate incentives and support packages in order to motivate investment or to promote investment by strengthening the capital market.

He added: “Unfortunately, most of the banking facilities have been allocated to large companies, most of which have returned to the banks. There is no supervision over this group of companies, and therefore a large part does not remain for small and medium enterprises.” It is clear that this is an important factor in creating and spreading corruption and rent in the country’s financial system. All over the world, however, banks mainly lend to small and medium-sized enterprises, and large corporations often use capital markets for financing.

The head of the Money and Capital Commission of the Tehran Chamber of Commerce said: “Usually, the banks themselves do not accept the projects as collateral and ask for large collateral in exchange for providing facilities.” While the private sector does not have the capacity for the major collateral required by the bank, some have received major facilities that have not been returned to the banks due to rent and corruption. Therefore, the principled allocation of facilities or the definition of special facilities package for enterprises is one of the necessities that the government should consider in its programs and monetary policies.

He added: “Most of the banking problems are for small and medium enterprises.” Therefore, the situation of banking facilities should be managed in such a way that large companies obtain their capital from the capital market. In this regard, building trust and creating transparency should be one of the most important programs of the government.

Mostofi added: “Unfortunately, sanctions have become a lever to justify all these problems, while this is not the case.” Sanctions exacerbate poor economic conditions and make inefficiencies more apparent, but this cannot justify the poor state of the business environment. The government must commit to building the internal infrastructure of the country’s economy.

He added: “Our companies have suffered a lot in recent years due to government mismanagement and lack of transparency, so the new government must prioritize improving the living conditions of the people as well as the business and production situation and repeating the mistakes of the past.” Avoid. Because inflation, recession, as well as the exponential costs faced by manufacturing firms, have reached the point where they are pushing firms to the brink of bankruptcy, while many of them are creating added value for the country’s economy and the government is pursuing the slogan of national production. Improper policies have been discontinued.

Mostofi noted: Therefore, the business environment needs to be improved through structural and legal reforms. There are various ways to advance this goal, including the reform of the tax system, social security, as well as the use of private sector expertise in formulating government economic programs and policies, including by reforming privatization processes and strengthening the capital market to present large projects. He pointed out that by issuing bonds similar to other stock exchanges in the world and dealing decisively with corruption.

ILNA