[lit-ideas] Rhetoric and reality on Iran

  • From: Omar Kusturica <omarkusto@xxxxxxxxx>
  • To: lit-ideas@xxxxxxxxxxxxx
  • Date: Mon, 27 Nov 2006 08:03:14 -0800 (PST)


Rhetoric and reality on Iran
By Chris Cook 

Speaking Freely is an Asia Times Online feature that
allows guest writers to have their say. Please click
here if you are interested in contributing. 

There is rhetoric and there is reality, and nowhere is
that more the case than Iran. 

For some two and a half years now I have been working
with the 

content Iranian government to implement a new Persian
Gulf-based oil-pricing benchmark less open to
manipulation by intermediary traders. While this is in
the interests of the Iranian people and, come to that,
consumers globally as well, it has met entrenched
resistance from the Iranian Oil Ministry because
transparency is the enemy of private profit. 

President Mahmud Ahmadinejad has never been criticized
for venality - and is strongly in favor of the
transparency a benchmark price represents. He recently
lost patience with the current bourse manager put in
place by the Oil Ministry, who is continuing to
implement the ministry's strategy that the best way to
prevent the project proceeding is simply not to pay
the consultants responsible for carrying it out. 

The president therefore acted decisively to advance
the project by transferring responsibility for it to
the Ministry for the Economy, and I returned to Tehran
recently to recommence the process where I left off. 

Having experienced Iran, and having had privileged
access, with my Iranian business partner, at the
highest level (we met former president Mohammad
Khatami, hope to see his successor Ahmadinejad very
shortly, and have been invited to address the
parliamentary Energy Commission), I felt I should put
forward an alternative view based on experience rather
than perception. 

This is particularly the case because when I visited
the British Foreign and Commonwealth Office before my
recent trip to Iran, it was made quite clear that its
focus is on sanctions and that constructive action is
a long way down the list of priorities. 

I know of few places less "radical" than Iran. Its
Islamic Revolution was 27 years ago and two entire
generations have grown up since. The result is that
70% of Iran's population is under 30 - and they are
deeply dissatisfied with the unequal distribution of
oil wealth and the dysfunctional economy. In large
part, they want the material things we in the West
take for granted. While there is intense national
pride, there is very little evidence of the
ideological fervor that, from reading most British and
US comments, one would think is rampant in Iran. 

There are two deep-seated problems that hold back Iran
(putting US sanctions to one side): first, there is a
deep-seated conflict between Islamic values and the
"Western" financial system and "enterprise model";
second, there is a massive managerial vacuum in Iran
due to the hierarchical and bureaucratic
decision-making structure and the fact that many
decision-makers are not necessarily appointed for
their managerial competence. 

The worst thing that the United States could ever do
is to bomb Iran: it is probably the only thing that
would swing these patriotic people squarely behind
their government and galvanize a tidal wave of
destruction, particularly in Iraq. 

Instead, the US should explore how it may engage
constructively with Iran, by bringing to bear a form
of capitalism that more closely reflects Islamic
values than the existing structures we in the West
take for granted. 

Anyone engaged in the "social enterprise" sector may
have some feeling as to how this may be achieved, and
I have for instance been working with our Iranian
partners to develop, first, new, innovative,
"asset-based" financial contracts (based on actual
ownership of oil, oil products or even liquefied
natural gas) as opposed to conventional
"deficit-based" margined futures contracts, and
second, to develop new "partnership-based" legal
structures (not dissimilar to the British
limited-liability partnership, or LLP) that share risk
and reward differently from more conventional Western
forms such as the joint-stock limited-liability
company or "corporation". 

The top priority of President Ahmadinejad - indeed, it
was the reason he was elected - was to improve the lot
of the average Iranian. There is no stomach in Iran
for continued "revolution" domestically and even less
prospect of exporting it in the absence of a US

While it may well be that Iran has acted tactically,
eg to support resistance in Iraq, its strategic
interests lie in a stable government in that country
with secure borders, and the Iranians wish the US to
guarantee that security. 

The United States and the United Kingdom must engage
with Iran, without precondition, to enable Iran to
interact economically in partnership with other
nations and thereby to rebuild and develop the Middle
East. That is the only road to peace: bombing Iran
would be a disaster of epic proportions and would
inevitably lead to the very outcomes that those in
favor of military action against Iran most fear. 

In summary, there is no more desire within Iran for an
Islamic hegemony than there is in Beijing for a
communist one: that is the reality, all else is

Chris Cook is a former director of the International
Petroleum Exchange. He is now a strategic market
consultant, entrepreneur and commentator. Reprinted
with permission from www.energybulletin.net. 

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