‘Stock market can meet production units’ demand for liquidity’

Former Deputy Industry, Mining, and Trade Minister Mehdi Karbasian believes that the stock market can provide the liquidity required by the country’s productive sectors to perform at full capacity, IRNA reported on Sunday.

All around the world, investor liquidity is a major source of capital for production units which is mostly provided by the banking system or the capital market, but in Iran, it [growing liquidity] is considered as an issue,” Karbasian said. Pointing to the important role of the capital market in removing barriers to production and creating the necessary conditions for the realization of the slogan of the current Iranian calendar year (started on March 21) which is named “Production: Knowledge-Based and Job-Creating” the official added: “There are several factors affecting the production process in the country, each of which should be considered separately.”

He underlined investment as the first factor affecting production units in the country and said: "We must accept that the rate of investment in the whole country is very low and even close to zero, such a statistic indicates that investment planning has not been made at the macro level and no alternative has also been provided for this issue; Therefore, the existence of such margins has prevented the country from moving towards the development and productivity.”

Considering the issues created by the U.S. sanctions in the way of attracting foreign investment, the capital market can help the development of production units in terms of providing liquidity, and this market has a special place in this field, Karbasian added.
He pointed to the widespread presence of people in the capital market and said: "In recent years, people have become more willing to participate in the capital market and we have witnessed significant investments in this market."

“Despite the inconveniences created in the stock market over the last two years, it seems that this market has gained a special position among people compared to other investment markets, and considering the support provided by the government, we can see the strengthening of transactions in this market,” the official said.
If the government continues to strengthen and support the capital market, it can help the production sectors by providing liquidity, which is the basis for creating economic transparency and helping to achieve the slogan of the year, he added.

Source: Tehran Times