Challenges of the Union and Solutions for Overcoming Them
Speech by Seyed Amir Alavi Far at the General Assembly of the Union of Exporters of Oil, Gas, and Petrochemical Products: "Challenges of the Union and Solutions for Overcoming Them"
In the name of God
Honorable members of the Union of Exporters of Oil, Gas, and Petrochemical Products, and esteemed attendees,
First and foremost, I would like to sincerely appreciate the tireless efforts and valuable contributions of all the founders and members of the Union's Board of Directors over the past eleven terms, since 2003, especially Mr. Farhad Fazooni, the first Chairman of the Board, and Dr. Ma'roufkhaani, the most recent esteemed Chairman. This invaluable legacy represents your collective wisdom and experience, and your services in advancing the Union's objectives are commendable.
In this brief opportunity, I will address the challenges facing the Union and the solutions to overcome them. After thoroughly reviewing the resolutions of various Union committees since 2022, which are available on the Union's website (opex.ir), and analyzing them using artificial intelligence tools, I have identified an interesting correlation. The majority of the resolutions focus on managing secondary issues. This means that key decisions are made at high levels of governance and government institutions, and the consequences—often negative—of these decisions are imposed on the private sector and the Union's members. Therefore, the Union, with its 386 members, primarily plays a role in managing the outcomes of decisions at the secondary level, rather than making decisions at the primary level.
To clarify the issue, let me refer to an example from Turkey. After the downing of a Russian jet on November 24, 2015, and the severance of political and economic relations, the pressure from Turkey's private sector forced President Erdogan to issue an official apology to Putin in less than five months. This demonstrates the significant weight and influence that the private sector in Turkey has in the country’s strategic decision-making. Unfortunately, in Iran, this role has historically been overlooked, especially in the oil and gas industry. Now that the Union of Exporters of Oil, Gas, and Petrochemical Products accounts for about $20 billion in the country's total exports, it is essential that this seat be considered in the primary decision-making processes of governance.
It seems that one of the reasons for the lack of allocation of this position to the private sector is the accusations that the governing bodies direct at the activists of this sector.
The four main accusations made against the private sector activists are as follows:
- Lack of sufficient attention to safety issues: Many private companies are currently obtaining certifications from the Civil Defense Organization. It is recommended to establish a Civil Defense Committee within the Union, with the presence of a direct representative from the organization, to hold regular meetings and actively participate in relevant projects.
- Risk of smuggling subsidized products: It is suggested to establish a committee for technical evaluation to closely monitor the actions of manufacturing companies. This analysis can help reduce the risk for banks in providing payment guarantee letters for feed purchases or customs guarantee letters to exporters.
- Lack of sufficient expertise in process and operational issues: By establishing a technical-process committee similar to the committees of the National Refining and Distribution Company (Petroleum Products Specifications Committee), the supervision of the quality of private sector productions can be entrusted to this committee.
- Insufficient financial capacity for large-scale purchases: To address this concern, consortiums consisting of companies with standard technical and financial qualifications can be formed to secure the necessary liquidity and guarantees from an independent banking network.
It is hoped that by addressing these four concerns, the private sector will be able to play a more active role in national business and economic relations, effectively managing the economic flow.
