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I I r r a a n n E E c c o o n n o o m m y y U U p p d d a a t t e e
Issue 123/2016 – Monday November 14th Content
Korean GG Foundation finances construction of a neuroscience hospital in Tehran
Govt. allots $1.5 bn from NDF to address unemployment in rural areas
Industry ministry official confirms recession in construction sector Korean GG Foundation
finances construction of a neuroscience hospital
A contract for investment and construction of a neuroscience hospital was signed on November 13th between the Medical Council of the Islamic Republic of Iran and Korea’s G.G. Foundation, local Iranian media outlets reported today. The contract was signed by Alireza Zali, the president of Medical Council of the Islamic Republic of Iran and Park Kwan Ho, the CEO of Korean G.G.
Foundation.
After the signing ceremony, Zali termed the G.G. Foundation as a
“reputable Korean investment company” and said that this neuroscience center would provide neurology treatment and diagnostic services based on modern techniques. “This Korean company has a good track record in construction, installation, and provision of medical equipment as well as providing innovative hospital methods,” said Zali, and added that this neuroscience center would be the first one in the South Eastern Asia.
According to IRIB website (the Islamic Republic of Iran Broadcasting), Zali explained that
“A Korean company working in industrial, power and energy areas showed interest in investment in Iran’s health and hospital building projects and today, after some months, we witness financing the construction of an international neuroscience hospital in Tehran.”
“This Korean company has good experience in hospital issues,” he said, adding that this is the first private-sector hospital in Iran because other hospitals are built under the supervision of the government.
Nematollah Torki, the president of the Tehran Province’s Management and Planning Organization (MPO) who attended the signing ceremony said “this is the first time that such a good development takes place in Iran and in the Middle East region.” He said that this is the second contract Iran strikes with this Korean organization, and explained that the land has been acquired and the project will cost
$400 million (or about 1,400 billion tomans), to be complete in 3-4 years. “This is the first contract
signed post-sanctions in the field of health and treatment,” said Torki, according to the official website of Tehran MPO.
IRIB quoted Torki on the sidelines of the signing ceremony as explaining that the Korean company works in the area of treatment, engineering parts and equipment procurement. Once complete, said Torki, the hospital will also provide services for citizens of other nations in the region. “The major concentration of us in this project is tourist treatment,” said Torki.
In an interview with IRIB, Park Kwan Ho, chairman of G.G Foundation said (in English): “Our investment amounts would be approximately $400 million and we need about three years as construction period, and the Korean construction company will guarantee quality and we will bring the best contractors plus good finance and will build one of the best hospitals.”
The English-language newspaper Financial Tribune wrote today that the hospital will be built in East Tehran (district 4), and quoted
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Korean nurses and neurologists will also work there.
IRNA wrote that the contract’s structure is EPC (Engineering, Procurement Contract) and points out to the fact that Korean G.G.
Foundation is already engaged in two power plant projects in Fars and Sistan & Baluchistan provinces.
Of note, Mehr News Agency reported on October 6th that two contracts totally worth $820 million have been signed between the Iranian Investment &
Economic Development
Headquarter and South Korea for establishing two wind and solar power plants in Zabol (Sistan-&
Baluchistan Province) and Fasa (Fars Province). At that time, Mehr News didn’t mention the name of the Korean company and confined itself to saying that it is supposed to carry out the two projects (a
$220 million contract for a 100 MW wind power plant in Zabol and a $620 million worth 200 MW solar plant in Fasa) in 15 months.
Jameh News wrote today that the Korean side will finance the project while the Iranian side will take the responsibility of operation and management.
Govt. allots $1.5 bn from NDF to address unemployment in rural areas
The Rouhani cabinet on Sunday approved a bill for withdrawing a
rial equivalent of $1.5 billion from the National Development Fund (NDF) for job creating projects in the rural and tribal areas of the country, Mehr News reported.
Following the approval of the cabinet, the bill will be presented to the Majles for ratification.
Iran transfers 20% of its oil revenues annually to the NDF to be spent on development and job- creating projects and supporting private, non-government, and cooperative sectors by extending low-interest loans. The fund was established in 2008 and is a successor to the former Oil Stabilization Fund.
The growing problem of youth unemployment is becoming a serious matter of concern for Iran’s leadership. On October 18th, Mohammad Shariatmadari, vice president for executive affairs expressed grave concerns about
“accumulated unemployment among the youth” and warned that people won’t tolerate and won’t wait more until the long- term investment projects create job are realized, and called for accelerating efforts to find short- term solutions for unemployment crisis. In a recently-released report, the Majles Research Center, the research arm of the parliament has stated that in the past decade, about 8 million people have been added to the country’s working-age population while less than 1.3 million new jobs have been created. The MRC
argues that assuming a 5-percent annual economic growth rate and an unchanged Iranian labor force participation rate, more than 4 million Iranians would be jobless by 2021. The MRC warns that the massive number of the youth that fail to find jobs after graduations would result in exacerbation of the social problems such as divorce, addition, and marriage postponement. The MRC also sheds light on the mismatch between university graduates’
skills and the needs of the job market as another problem plaguing Iran’s job sector and argues that currently, unemployment rate among university graduates is higher than that among uneducated individuals.
Industry ministry official confirms recession in construction sector
Mohsen Salehi-Nia, the deputy minister of Industry, Mine & Trade confirmed that the continued downturn in Iran’s construction industry has adversely affected 50 related industries, the daily Donyay-e Eghtesad wrote on Monday. Contrary to the petrochemical, steel and automotive sectors that have experienced growth rates, said Salehi-Nia, the contraction sector is in a downturn, which has rippled through the 50 related industries such as tile and ceramic, tubes and profiles, home appliance, and such like.
