Increasing government salaries does not match market conditions
If property interest and government rights are to be increased and the investor is unable to offset this increase elsewhere, it will have the opposite effect, closing some of the country's mines.
According to Iran's International Stone Exhibition, a country's budget reflects the state's position in the economy and determines the extent of government involvement in the field. Since the share of oil revenues in next year's budget has fallen sharply, the government has been more inclined to tax revenues, government salaries and ownership of mines, but given the economic conditions of the country, a 90% increase in government mines in next year's budget will The cuts are affecting the cost of the mines and are causing miners problems. Semet has talked to experts in the field about how the increase in government salaries will affect the private sector.
Closing of some mines
Qivan Jafari Tehrani, an international expert on Iran's iron ore market, said the increase in government wages and equity interest projected in next year's budget did not match market conditions, but said it was not a problem for government mines but a problem for investors and the private sector. .
Jafari Tehrani stated that the private sector should be supported, saying: We should not make the investor, especially the private sector investor, afraid of getting out of the investment arena. If property interest and government rights are to be increased and the investor is unable to offset this increase elsewhere, it will have the opposite effect, closing some of the country's mines.
The international expert on the iron ore market in Iran also said that the increase in the price of mineral products would naturally increase when the government's rights and ownership interest increased. Because primary mining products are considered upstream, the rate of intermediate and downstream products increases in the same proportion as the finished rate in the mine increases.
"We can strike a balance if we adjust the domestic sales rate," he said, referring to the increase in export duties on upstream minerals.
Jafari Tehrani also commented on the impact of rising rates on domestic production and exports of steel products: The increase in the cost of finished iron ore, concentrate and pellets will affect domestic and export rates, and this will also reduce our share of the steel export market; Decisions to increase equity and government rights must be based on a policy that is consistent with market needs.
He stressed: "If this is to happen unilaterally and on the government's side, we will have the opposite result and we will see the closure of mines and reduced production in the country."
The mining sector needs revenue
Mansour Ghorbani, a professor of mining at Shahid Beheshti University, said: "Increasing government salaries is of no benefit to the government and the private sector, as a result of which many small mines suffer losses and are eventually shut down."
Expressing that the mining sector needs income, the victim said: "Miners must have an income so that the government can receive property interest and state rights." Where can the state pay when the mine is closed and the mine closed? So not only will the government and the miner benefit, but they will both lose, and as a result, the mine will be orphaned.
Pointing out that government rights and taxation of government revenues are from the mine, the university professor said: "Taxation cannot be enforced because it has many consequences. If we increase it for a cortex, but don't pay attention to their income, we just push them to a holiday. Remember, when a company loses, it can no longer afford to pay taxes.
Emphasizing that the mining sector needs a lot of funding, Ghorbani said: "If the government wants to thrive in business and employment, it should activate the mining sector by raising funds." Exploration, extraction, production and processing require considerable cost, so the government must support the miner to ultimately make money.
The government, with the support of the miner, solves some of the social problems through employment. Employment needs to be expanded and the private sector thrives, boosting economic growth, so injecting budgets and facilitating mining policies and diminishing the role of government in economic activities can help the mining sector grow.
