New ECOTDB President Appointed - Economic Cooperation ...

PRESS RELEASENew ECOTDBPresident AppointedThe founding countriesof the ECO Trade andDevelopment Bank(ECOTDB) appointed Dr.Hossein Ghazavi as theBank's new President.Following the appointmentto his new position,Dr. Ghazavi took office atthe Headquarter of theBank in Istanbul, as ofNovember 1st, 2011.Dr. Ghazavi prior to hisnew appointment servedas the First Vice-Governorof the I.R. of Iran CentralBank. He brings with himmore than three decadesof diverse national andinternational experiencein Corporate andConsumer banking to theECOTDB.Prior to his post at theCentral Bank of the I.R.of Iran, Dr. Ghazavi hadserved as a BoardMember of ExportDevelopment Bank.He had been theDirector General of theOffice of Loans andInternationalOrganizations at theMinistry of EconomicAffairs and Finance.Dr. Ghazavi had been amember of InternationalAd-Hoc Committee forDraft Convention againstCorruption in Vienna(2001-2003).Website: www.etdb.orgE-mail: info@etdb.org

Season’s GreetingsIn the Name of AlmightyCoverThe 21st CenturySilk Road,ECO Railways Connect the PersianGulf to the Heart of Central Asia19th ECO DayCelebrationsECO Chronicle's prime mission is to reachpolicy-makers, scholars, economists and publicand private development experts as well asthe wider ECO public opinion and informthem on ECO activities in areas such as trade,transport, energy and environment and solicitviews and comments on the Organization'sefforts to build the necessary infrastructure forpromoting regional integration and cooperationamongst its Member-States. Thebimonthly also aims through its readership toconnect the network of dedicated staff withinthe ECO Community and generate exchangeof views and opinion on matters of concern.The Organization's affiliate publication, ECOTimes will continue its successful coverage ofthe region's cultural and artistic events. Bothpublications aim at promoting greater cohesionand cooperation amongst the people ofthis important region. The Editorial Board welcomesarticles for print and suggestions fromreaders on topics of particular interest. Welook forward to your comments and proposalsand rely on your continued support.Finaly, as the year draws to its end, wewould like to convey to ECO member nations,our best wishes for the New Year 2012.it isour sincere wishes that the New Year will bemore peaceful, more prosperous for our people,our region and indeed for the peoples ofthe Earth. We extend to you our heartiestgreetings and warmest felicitations on thisgreat occasion of joy and elation. May the spiritof cooperation and peace prevail over theforces of segregation and despair. Amen!Published byEconomic CooperationOrganizationPatron & SupervisionMohammad Yahya MaroofiECO Secretary GeneralEditorial BoardFatih UnluAltaf AsgharAbolghasem TahmasebiMahmoud KhaghaniEditor in ChiefAli SabzalianGraphic DesignKianoush SaadatmandPhotoMahdi SaadatmandECOchronicLEAddressNo. 1, Golbou Alley,Kamranieh St.,Tehran-IranP.O.Box \ 14155- 6176Tehran(I.R. Iran)Tel \ (+98-21) 22831733-4. (+98-21) 22292066Fax \ (+98-21) 22831732Emailregistry@ecosecretariat.orgWebhttp://www.ecosecretariat.orgEconomic CooperationOrganization is an intergovernmentalregional organization established in 1985by Islamic Republic of Iran, IslamicRepublic of Pakistan and Republic ofTurkey for the purpose of promoting economic,technical and cultural cooperationamong the Member States. It is the successororganization of what was theRegional Cooperation for Development(RCD), founded in 1964, which endedactivities in 1979. In the fall of 1992,ECO expanded to include seven newMembers, namely Islamic Republic ofAfghanistan, Republic of Azerbaijan,Republic of Kazakhstan, Kyrgyz Republic,Republic of Tajikistan, Turkmenistan andRepublic of Uzbekistan. ECO's secretariatis located in Tehran.

November 28,The ECO DayAt theECO SecretariatMinisters of Foreign affairs of the member countries areaddressed to ECO Secretary General.On October 4, 2011 in anticipation of this notable day,a well attended reception was organized by the ECOSecretariat in Kamranieh, Tehran where the ambassadorsof the ECO member states, heads of foreign diplomaticmissions and other VIP guests were present to celebratethe occasion.The Minister of Foreign Affairs of the host country Iran,Dr. Aliakbar Salehi as the "Guest of Honor" attended thecelebration event and congratulated the SecretaryGeneral for the ECO Anniversary and also inauguratedthe newly remodeled ECO Secretariat's main ConferenceHall.The Minister signed the Guest Book with the followingmessage:In Commemorationof 19th Anniversaryof ExpansionofECOECO CHRONICLE4ECOCHRONICLENovember28th of eachyear marks the Anniversary ofthe expansion of ECO in 1992from a three-member stateorganization to its presentstrength of ten important countries.To commemorate this dayand as a sign of solidarity, usuallycongratulatory messagesfrom ECO Head of States or

News“We hope that with the efforts and leadership of itsSecretary General, ECO will soon turn into a stronginstitution. Aliakbar Salehi”On October 9, 2011, Erzhan Kazikhanov, the ForeignMinister of the Republic of Kazakhstan, an ECO membercountry, paid a visit to ECO Headquarters in Tehran andcongratulated the ECO Secretary General for the ECOAnniversary. On the Guest Book, he wrote:“It is with great pleasure that I am visiting ECOHeadquarters. I wish you Mr. Secretary General andthe ECO staff all the success and prosperity in yournoble endeavors. Many thanks. Minister E.Kazikhanov.”ECO CHRONICLE5

Statement ofECOSecretaryGeneralECOCHRONICLE“The 19th anniversaryof the EconomicCooperation Organization (ECO)reminds us of the progress achievedtowards creating an environment forenhanced regional cooperation.The Organization since its establishmentin 1992 has come along way in consolidatingcooperation particularlyin the last decade. Onthe multilateral co-operationin key areas of economy,ECO has developed asharper focus on the LandlockedEconomies and Countries withEconomies in Transition.In the wake of a rapidly changingworld posing new challenges forregionalism, the performance of ECOhas improved through a more effectivemutually supportive relationshipamong its membership. Striving toECO CHRONICLE6ECOCHRONICLEECOA Brief History,Opportunities &ChallengesThe EconomicCooperationOrganization (ECO)was established in1985 as a trilateralorganization of Iran,Pakistan and Turkeyfor the purpose ofpromoting economic,technical and culturalcooperationamong the MemberStates.Aims and objectives of ECO are identical to those ofits forerunner, the Regional Cooperation forDevelopment (RCD), which remained in existence from1964 to 1979. The Treaty of Izmir signed in 1977,which provided the legal framework for RCD, wasadopted as the basic Charter of ECO with modificationsto provide a proper legal basis to ECO's for transitionfrom RCD.The Ministerial Meeting held in Islamabad in June1990 ratified new charter "Treaty of Izmir ECO", whichwas fully launched inearly 1991.Thebreak-up of formerSoviet Union led toindependence ofRepublics of CentralAsia and Caucasus,as a manifestation oftheir urge to revivetheir historic affinitieswith the peoples ofIran, Pakistan andTurkey, six of theseRepublics; namelyAzerbaijan,Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan andUzbekistan along with Afghanistan sought the membershipof ECO and were admitted into the organization.The participation of these new Members in the activitiesof the Organization were commenced after theirformal accession to the Treaty of Izmir at anExtraordinary Meeting of ECO Council of Ministers heldin Islamabad on 28th May, 1992. ECO gained a newdimension with its expansion from a three to ten-Members' Organization.

Newscoordinate economicpolicy tothe extent necessarytoachieve itsobjectives, ECOsuccessfully laiddown legal frameworksin Trade,Investment, Transport,Customs and VisaFacilitation. This has beensupplemented by creationof institutional mechanismsto foster economicdevelopment.The economic integrationprocess is thus wellpoised to ensure prosperityand stability of the region, ina spirit of mutual accommodation.In the context of infusing freshdynamism to the Organization, thecommitment of the Member States isof prime importance in pursuit of theircommon desire for a brighter and prosperousfuture for the peoples of thisregion.To this end, the decisions adoptedthrough common consensus by theECO decision making organs are guidingour future course.I am convinced that ECO region hasimmense potential. It can certainly berealized through collective effort andunderstanding.Over the years, ECO has developedinto an effective Organization for capitalizingopportunities through buildingpartnerships.On the auspicious annual day, weneed to remind ourselves of the promisethat ECO holds to further nurtureand develop economic and culturalintegration.”Over the past 18 years the member states have beencollaborating to accelerate the pace of regional developmentthrough their common endeavors. Besides sharedcultural and historic affinities, they have been able touse the existing infrastructural and business links to furtherfortify their resolve to transfer their hopes and aspirationsinto a tangible reality. ECO has embarked onseveral projects in priority sectors of its cooperationincluding energy, trade, transportation, agriculture anddrug control.Despite its young age, ECO has developed into athriving regional organization. Its international stature isgrowing. Nevertheless, the organization faces dauntingchallenges with respect to realization of its objectivesand goals.Most importantly, the region is lacking inappropriate infrastructure and institutions which theOrganization is seeking to develop, on priority basis, tomake full use of the available resources in the region.ECO CHRONICLE7

ECOCHRONICLEThe first level ofPost GraduateCertificate on EnvironmentalManagement (PCEM) and the firstTraining Program of the ECO Institute ofEnvironmental Science and technology(ECO-IEST) started with openingremarks given by the president of theECO-IEST, Dr. Asghar MohammadiFazel on 12 September, 2011. In hisremarks, he welcomed the participantsand delivered a presentation about thehistory of the institute.Dr. Fazel noted that according to thedecision of the 3rd ECO MinisterialMeeting on Environment (30 June2006, Almaty, Kazakhstan), the ECOInstitute of Environmental Science andTechnology (ECO-IEST) has been establishedas a part of Iran’s University ofEnvironment to generate knowledgethrough research and studies on environmentin ECO region; to strengthenhuman resources through training andeducational programs, seeking toexpand theoretical and practical knowledge;to promote scientific and technicalcooperation and exchange of experiencesand create a network of expertsOpening ofthe first levelof PCEMTrainingProgram atECO-IESTin the region; and to strengthen bilateraland multilateral co-operation to mobilizeinternational assistance for environmentalconservation in the ECO region.He also mentioned that ECO-IESTwas officially inaugurated in February2011, by H.E Mr. Mohammad JavadMohammadi Zadeh, Vice President ofIslamic Republic of Iran and Head ofthe Department of Environment (DoE),and H.E Mr. Yahya Maroofi, ECOSecretary General.In conclusion, he emphasized on thisopportunity within the course toexchange information and experiencesin the region and try to develop conceptpapers for new environmentalprojects for the region.Following presentationof Dr. Fazel, Mrs. Fazeli,Coordinator of the ECO-IEST, made adetailed presentation on PCEM TrainingProgram and its mission. At the end ofthis opening session, the participantshad an introductory tour in theUniversity to become familiar with differentsections of the university campus.A video clip about the activities of theUOE during the last year was also presentedin this opening session.ECO CHRONICLE10PCEM Students VisitECO SecretariatECOCHRONICLEOn 14 September, 2011, PCEM studentsvisited the ECO Secretariat and met AliKhanbutayev, the Director of the Energy, Minerals andEnvironment, who provided them with a brief history of ECO.During the visit, Khanbutayev pointed to the necessity of establishingan organization for strengthening the communication,developing science and technology, increasing the cooperationfor regional and international projects and encouraging moreresearch in the region. Referring to ECO's significant achievementsin various areas, he further noted: "The establishment ofPCEM in the ECO Secretariat is the result of a regional effortand interest of Iran's University of the Environment for bothhosting ECO-IEST and holding the first post graduate course inenvironmental management".Khanbutayev then elaborated on ECO's structure and its

NewsECOCHRONICLEThe 19th OSCEEconomic andEnvironmental Forum was held on 15-16September 2011in the premises of theMinistry of Foreign Affairs of the CzechRepublic attended by prominent personalitiesfrom OSCE countries. At the paneldiscussion titled "Regional andsub-regional cooperation on sustainableenergy and transport"held on September 16, 2011,ECO S.G. provided detailedinformation on ECO activities inthe field of energy developmentand alluded to the vastresources of energy in the regionsuch as oil, renewable energy,geothermal, biomass power, etc. In hisremarks, S.G. assured the meeting ofECO's cooperation at the regional leveland beyond on issues of mutual interest.The Economic and EnvironmentalForum is the main and the highest-levelannual meeting within the economic andenvironmental dimension of the OSCE. Itfocuses every year on a theme proposedby the Chairmanship and agreed upon bythe 56 participating States. Its objective isto give political stimulus to the dialogueon economic and environmental issueslinked to security and to contribute to theelaboration of specific recommendationsand follow-up activities to address theseS.G. PresentsECO EnergyDevelopmentat OSCE Forumchallenges.It also reviews the implementation ofthe participating States' commitments inthe economic and environmental dimension.The Forum meetings bring togetherevery year more than 400 participantsrepresenting governments, civil society,business community and other internationalorganizations, to engage in dialogueand consultations on how to address andidentify practical solutions for commoneconomic and environmental concerns.& Other Related Facilitiesdifferent technical and decision making bodies and committeesplus their planned meetings and duties. He pointed to the 4thECO Ministerial Meeting on Environment held in Tehran fewmonths ago and its approved 5-year-Plan of Action onEnvironment. He said that within this action plan, numerousprojects and activities were defined for the Member States forconservation of environment.He also pointed to 65 expertsfrom different Member States who are actively engaged in thefields of Energy, Minerals and Environment.There was also aquestion and answer session for the PCEM participants in whichthey asked several questions about the quality and level of partnershipand cooperation between ECO and other internationalbodies such as WB, UNEP, etc as well as ECO's budget.Afterwards, the students had a tour to the different departmentsof the Organization.In another part of the program, the studentsvisited Pardisan ECO Park and had a tour to different sections ofthe park and the Biodiversity Museum.On 15 September, 2011 (the fourth day of the PCEM course),the participants visited Tehran Traffic Control Centre andbecame familiar with traffic control systems in the municipalityfollowed by a visit to the Arardkooh Waste Processing andLandfill sites located in Kahrizak on the southern part of Tehranand received useful explanations of the process of collecting,transporting, sorting and recycling of different kinds of wasteand were introduced different parts of the site.Later the participants visited different parts of the site includingthe sanitary landfill, leachate treatment unit (under construction),Methane Extraction unit (under construction), Incinerationsite (under construction) followed by a question and answer session.ECO CHRONICLE11

COM MeetingLauds ECO's AchievementsECO CHRONICLE12ECOCHRONICLEOn the sidelinesof the 66thSession of the United NationsGeneral Assembly in New York, ECOCouncil of Ministers (COM) held their18th annual informal Meeting onSeptember 27, 2011. Dr. AhmetDavutoglu, the Minister of ForeignAffairs of the Republic of Turkey andthe current Chairman of the ECO-COM hosted and chaired theMeeting which was attended by ECOS.G. plus the Foreign Ministers /Representatives of the ECO MemberStates, over a working-lunch.While briefing the Ministers on therecent progress in the agenda ofECO, the S.G. presented an interimreview of the status of implementationof the decisions of the 11th ECOSummit and the 19th ECO COMMeeting and touched upon the keydevelopments made in various fieldsof cooperation including Trade,Transport & Communications, Energy& Environment, Narcotic's Control,Health and External Relations.Havingnoted the S.G.'s briefing, the ForeignMinisters expressed contentment overECO's achievements during the presentyear, across the spectrum of fields under its preview particularlyin the areas of transport, narcotic's control and external relations.The Member States also appreciated ECO's progress on suchtransport-related projects as the construction of railway line onKazakhstan-Turkmenistan-Iran route, feasibility study on KyrgyzRepublic-Tajikistan-Afghanistan-Iran route, revitalization of ECOContainer Trains on Istanbul-Almaty and Almaty-Bandar-Abbasroutes and commercialization of the freight services on theIstanbul-Tehran-Islamabad container train.While laying emphasis on the significance of the aforementionedprojects for building up an efficient and modern transportinfrastructure in the region, the Council urged the Secretariatand the Member States to pursue their early realization. In theirremarks, the Ministers also expressed satisfaction over the successfullaunch of the 3rd ECO Eminent Persons Group andexpressed confidence that recommendations of the EminentPersons would help enhance dynamism, efficiency and visibilityof ECO. The Meeting, while acclaiming the efforts made by theSecretariat in promoting the Organization's ties with otherregional and international organizations, called on the Secretary-General to sustain the ongoing efforts for further strengtheningmeaningful cooperation with the United Nations system andother regional and international organizations in line with thedirectives of the ECO decision-making bodies.The Meeting also indicated its contentment over the commencementof ECO/ASEAN relations and expressed hope thatthe follow-up of the decisions taken by the Joint Meeting wouldspeed-up implementation of ECO-ASEAN MoU and the WorkProgram in different areas. Regarding the proposals of the ECOContact Group in New York on effective implementation of theUNGA biennial resolution on ECO-UN cooperation, theMinisters endorsed the recommendations and stressed the needfor the Contact Group to continue playing an active role in promotingECO's interests at the United Nations and other relevantregional and international Organizations. The Council also welcomedKazakhstan's bid to host the International ExhibitionEXPO-2017 as well as Turkey's bid for EXPO-2020.The Council underscored the need for sustained and active follow-upon all the decisions of the 11th ECO Summit and the19th ECO COM Meeting to accelerate progress in different sectorsof ECO cooperation. In their concluding remarks, theMinisters renewed their abiding commitment to foster regionaleconomic integration among the ECO Member States in keepingwith the spirit of the Treaty of Izmir and resolved to play anactive role in realization of ECO's aims and objectives.

NewsECOCHRONICLEThe DehmazangPublic Park andKabul Zoo projects,financed by ECOFund were inauguratedin Kabul on15 September2011. The eventwas widely coveredbyAfghanistan's electronicand printmedia.Mohammad Younes Nawandish, KabulMayor and Abulqasem Tahmasebi,Deputy Secretary General of ECO, jointlyinaugurated the project. Mustafa Zaher,General President of the EnvironmentalDepartment of Afghanistan, Dr. NazirAhmad Shahidi, Deputy Minister ofEconomy of Afghanistan as well as thecorrespondents of the print and electronicmedia were also present at the inauguralceremony.At the outset Aziz Sagheb, Director ofthe Dehmazang Public Park and KabulZoo, in his address while briefing theaudience regarding the completion of theproject appreciated the ECO Secretariatfor its financial support.Kabul Mayor in his statement elaboratedabout the activities of Kabul Municipalitywith regard to the renovation and rehabilitationof the City of Kabul and especiallyDehmazang Public Park and Kabul Zoo.He thanked and appreciated the ECOfinancial assistance for this project andrequested the authorities of ECOSecretariat for more cooperation in thefuture. "Beside the ECO Fund, KabulMunicipality also contributed funds forECOFinancesPublicProjects inKabulrebuilding sidewalksand other parts ofthis project", headded.AbulqasemTamasebi, DeputySecretary General ofECO appreciatedthe activities carriedout by the KabulMunicipality for thecompletion of theproject. He assuredto convey therequest of Kabul tothe ECO, Secretary General for allocationof funds for future projects. MostafaZaher, General President of theEnvironmental Department of Afghanistanbriefed the participants about the backgroundof the Kabul Zoo. Dr. NazirAhmad Shahidi, Deputy EconomicMinister of Afghanistan also delivered aspeech and appreciated the ECO, financialassistance for the reconstructions ofAfghanistan and wished for the continuityof ECO's cooperation in other neededareas.An amount of one Million and threehundred thousand US Dollars has beenearmarked for the project, three installmentsof which have already beenreleased, whereas the fourth would bereleased upon the completion of the project.On behalf of the Kabul Municipality,Certificates were awarded to those whocontributed in this project.The Kabul Zoo, located on the bank ofthe Kabul River once had more than 500animals with about 150,000 visitors comingto see them annually. The zoo sufferedsignificant damage during the longcivil war in Afghanistan.IstanbulHostsCPRMeetingECOCHRONICLEThe Government ofthe Republic of Turkeyas the current Chairman of ECO hasoffered to host the 173rd ECO Councilof Permanent Representative (CPR)meeting in Istanbul on 5-7 January 2012.The CPR Meeting are usually held in theI. R. of Iran as the host country of theECO Secretariat.During the 173rd CPR Meeting whichwill constitute a special occasion, in additionto regular items of the CPR agenda,presentations will be made on ECO-CCI,ECOSA, ECO Truck Caravan, ECOPLAFand Status of EPG process and a signingceremony will be organized for ECO -FAO-SEC Project on Seed SectorDevelopment in the ECO MemberStates.BOTMeetingforECOSF,A MillstoneECOCHRONICLEThe specializedagency of ECO withthe mandate to promote cooperation inthe field of science, engineering & technology-the ECO Science Foundation(ECOSF) - has been rendered operationalafter more than sixteen years. The inauguralceremony of ECOSF was organizedon the occasion of the 1st Meeting of theBoard of Trustees (BOT) of the ECOSFpreceded by a High-Level Experts GroupMeeting held on Dec 19-20, 2011 inIslamabad, I.R. of Pakistan. After 16 yearssince its establishment ECOSF's BOTMeeting, is regarded as a milestone forECO region as well as for its membership.ECO CHRONICLE13

Bandar Abbas HostsECO Int'l Confabon Logistics & TransitDevelopmentECO CHRONICLE14ECOCHRONICLEThe Conference onLogistics and TransitDevelopment in theEconomicCooperationOrganization (ECO)region was launchedon 17-19 October2011 in BandarAbbas, Southern Iran.Delegates fromMinistries ofTransport andCustomsAdministrations aswell as the nationalfreight forwarder and logistic associationsand the business community ofthe Member States attended the threeday event.International organizations and internationalfinancial institutions includingUnited Nations Conference on Tradeand Development (UNCTAD),International Road and TransportUnion (IRU), United NationsEconomic Commission (UNEC) andIslamic Development Bank (IDB) werealso invited to the Conference.The opening ceremony coincidedwith the commissioning of BandarAbbas-Almaty container train services.Objectives of the conference included:introducing senior officials andbusiness representatives to the work ofinternational and regional organizations,e.g. ECO, UNCTAD, UNECE,IRU, on promoting regional transit/logistics operations in the ECOregion; exchanging views and experiencesabout regional transit facilitation/logistics;improving the access ofthe ECO landlocked countries to seaportfacilities of coastal member statesby road and rail corridors; operatingthe ECO ContainerFreight Service onBandar Abbas Almatyroute; and discussingprospectives of theECO cooperationwith internationalorganizations todevelop integratedregional transit /logistics system.Persian GulfBandar Abbas - Almaty Railroad

NewsTransport,the BloodLine ofInternationalEconomy“”Highlights of Statement byECO S.G. at the Int. Conf. onDevelopment of Transit &Logistics in ECO RegionTransport System, ECO's TopPriority"ECO Organization attaches top priority to thedevelopment of an efficient transport system inthe region. Today's Conference, according to ourthinking, would go a long way in promoting acoordinated approach necessary to remove theimpediments still hindering the full use of multipletransit transport routes available in the region.Conference's Main Objectives"Keeping in view the main objectives of theConference, I would now like to highlight themodest ECO achievement in the specific area oftransport transit. Through our programmes, wehave aimed at initiating a process of reforms onto Central Asiathe Silk Road of the 21st CenturyECOCHRONICLENow the ECO Regionhas become the cross road of the mainInternational North-South and East-WestCorridors. In a ceremony attended byhigh ranking authorities from ECO memberstates, international organizationsincluding UNCTAD, IRU, UNEC, IDBand officials from the ECO Secretariat,the first transit train of the Bandar-Abbas(Iran) - Alma-Ata (Kazakhstan) lineof 3756 km was launched on October17, 2011. On the sideline of this historicevent, the 3 days long ECO InternationalConference on Logistics and TransitDevelopment was held in Bandar Abbas,Hormuzgan province.The launching of the Sea - Rail corridorwill open a new chapter in the transportationsector in the ECO region. Thisproject and regular activation of the corridoris one of the most important transportprojects in the ECO region and it ismuch emphasized by UNESCAP. Iran'sPresident Ahmadinejad described therailway a "Historical and important projectfor the region", similar statementswere heard elsewhere in the ECO membercountries.By this train, the highly strategic Iranianport of Bandar Abbas through IslamicRep. of Iran connects the land lockedcountries of Rep. of Kazakhstan, Rep. ofUzbekistan and Turkmenistan to the blueshores of Persian Gulf to southeasternAsia and the Persian Gulf Arab countries.Total length of the corridor is 3756 kmand it takes about 150 hours and 12 minutes(6 days and half) for the train to travelon the corridor.This route which has the capacity oftransiting 2 million tons of goods perannum is technically the most importantcorridor for export-import and transit intothe Central Asia and beyond. Out of thetotal 3756 km corridor, close to 1,619kmis located in Iran, 449 km inTurkmenistan, 732 km in Uzbekistan and956 km in Kazakhstan. Iranian Roads andUrban Development Minister, Ali Nikzad,announced that "Iran aims to increase itsannual transit capacity to 30 million tonsin coming years, from current 12 milliontons".He pointed out that transit of goods toand from neighboring states will reach 12million tons in the current Iranian year (toend March 2012). The Minister continuedthat "Iran which has over 20 internationalborders with its neighbors, conductsthe largest amount of transit".ECO CHRONICLE15

ECO CHRONICLE16sustainable basis in the regulatory, managerial and institutionalstructures within each Member State. The organization has pursuedthis goal by adopting a-three pronged strategy:Firstly, the Member States have been requested to take thelead in building infrastructure, particularly the missing road andrail links by using their budgetary allocations. Secondly, theMember States are being encouraged to harmonize their rulesand regulations with international conventions and agreementsin transport and trade sectors. Thirdly, in collaboration with theMembers States, ECO attempts to promote institutional capacitywithin each Member State by arranging trainings, workshops,seminars and encouraging Member States to integrate themselvesto international institutions and regional bodies. In thiscontext, they have been requested to sign bilateral agreementswith neighbouring transit countries and adhere to the agreedcommitments with regard to development of smooth transittransport system in the region. The overall objective is that thetransit transport edifice emerged thus far in the region should befully utilized optimally to reach out to more developed globalmarkets.East -West & North -South Corridors"The key role of an efficient transittransport for the promotion of regionaland international trade is self-evident. Infact within the context of the rapidgrowth of international trade and theglobalization of international economy,transport has become the blood line tomeet the basic requirements of the growingdemands of exporters, importers andthe users of commodities and products.The current geo-political world requiresspeedy development of the means ofpassenger and freight transport. We aretrying hard to establish east-west andnorth-south corridors free from all bottlenecks. We have initiatednumber of projects to achieve this objective. In order to connecteast-west and north-south, we have conducted a feasibility studyto examine revitalization of Istanbul-Almaty container train. Thestudy also examined the feasibility of a container freight serviceon Bandar Abbas - Almaty Route.Significant Progress Made"Significant progress has also been achieved in the constructionof the railway on Kazakhstan-Turkmenistan-Iran route, which isbeing monitored by a Trilateral Coordination Committee underthe aegis of ECO. Hopefully this project would be completed bythe end of 1st quarter of next year.In rail sector, we have identified another project for connectingChina to Europe through Kyrgyz Republic, Tajikistan, Afghanistanand Iran. The feasibility study inside Tajikistan is underway andwe are exploring sources to finance the feasibility study insideKyrgyzstan. We have also been able to launch a regular containertrain on the Islamabad- Tehran- Istanbul route since Augustlast year. We are busy in making it more regular, more efficient,more competitive and attractive to shippers and consignees. Inthis respect, we are grateful to the concerned railways of ECOMember States and the private sector for their cooperation andtechnical assistance to make this dream realized. Along with this,we have a plan to see an international passenger train movingon the Trans Asian railway route from Islamabad-Tehran- Istanbuland Almaty to Tehran-Istanbul and onward to European cities.ECO's Truck Caravan"During September-October 2010, the ECO Silk RoadDemonstration Truck Caravan, comprised of trucks from eightmember states and a team of ECO/IRU experts, made 11,400km demonstration journey across the region. This historical projectmade headway in enhancing regional cooperation in roadtransport. Inspired by the successful launch of theDemonstration Truck, ECO initiated the Regular Monitored Runof Trucks in 2011 in partnership with IRU, involving 1.000 realcommercial journeys during 6 months.Two Road Transport Corridors" We have initiated to establish two road transport corridors,one between Islamabad-Tehran-Istanbul,and the other between Iran, Afghanistan,Tajikistan and the Kyrgyz Republic. Theaim of these Projects is to promote anddevelop the transport corridors bylaunching the regular run of trucks alongthese corridors. We are awaiting proposalsfrom other member states to undertakesimilar corridor studies.Legal & RegulatoryFramework"ECO has come up with proposals forstrong legal and regulatory framework toensure harmonization of border crossingprocedures, need for unification of policieson transit fees, common insuranceand rail tariffs etc. Landmark achievements have been twoagreements namely ECOTA and the Transit Transport FrameworkAgreement. Both these agreements have the capacity to providea strong base for a harmonized if not fully unified regulatoryregime for an efficient transport and trade transit administration.Lack of Awareness& Need to Educate"Before concluding, I would like to say that our success isdependent on the degree of ownership of our programmes bythe Member States as well as the commitment of the directbeneficiaries. Additionally, it is also important that the ECO'sprogrammes and initiative must be known to the GeneralPublic. We have observed that only concerned authoritiesknow about the programmes of ECO and General Public andbusiness community is unaware of our efforts, which is notgood. Since our objective is to change the socio-economiccondition of the people of our region, we will request theMember States to educate their people and business communityabout the programmes of the organization and encouragethem to utilize the opportunities being created by the ECO intrade and transport sectors.

NewsECOCHRONICLEThe 1st Meeting ofECO Experts Groupand 3rd Workshop on RenewableSources of Energy were held on 25 & 26October 2011 respectively. A field visit tothe Electrical Industry Exhibition on 27thOctober was also arranged. The eventswere arranged in Tehran by theRenewable Energy Organization (SUNA)of the Islamic Republic of Iran.Delegates from the ECO MemberStates of Azerbaijan, Iran (Host),Kazakhstan, Kyrgyzstan, Pakistan,Tajikistan and Turkey as well as representativesof ECO Secretariat and theUNIDO also participated.The participants expressed grief andsympathy with the people of Republic ofTurkey on the colossal loss of life andproperty caused by the recent earthquakein the Province of Van of Turkey.Mr. Yousaf Armodli, Managing Directorof Renewable Energy Organization"SUNA" of the Islamic Republic of Iranand Mr. Abolghasem Tahmasebi, DeputySecretary General of ECO Secretariatdelivered opening statements underliningthe importance of the renewable energyresources. They stressed upon theMember States for collective efforts andregular exchange of experiences in thisfield. The representative of the ECOSecretariat presented a review of theECO Activities on Renewable Sources ofEnergy and Implementation of the ECOPlan of Action for Energy CooperationThe head of delegates of the MemberStates made statements on their NationalProgress on Renewable Sources of Energyand the Implementation of the ECO Planof Action for Energy Cooperation. Intheir statements/presentations theyhighlighted their respective countriespositions on the NationalProgress on Renewable Sourcesof Energy reflecting their country'spolicies, achievements,experiences, latest developmentsand trends in the field ofthe Renewable Sources ofEnergy as well as theImplementation of the ECOPlan of Action for EnergyCooperation.RenewableSources ofEnergy1st Meetingof ECO ExpertsGroup & 3rdWorkshopThe participants exchanged views ondevelopment of a mechanism for implementationof the following strategies ofECO Plan of Action for EnergyCooperation:Developing a policy and institutionalframework for the development ofRenewable Energy (RE)Financing mechanismFurther strengthening informationnetwork in REPromoting intra-ECO cooperation onECO made products and servicesPromoting the utilization of new andrenewable energy technologies, thedevelopment and contribution of RE inenergy supply and demandPromoting education for trainingskilled personnelThe participants also agreed to enhancecooperation with the relevant internationalorganizations in the field ofRenewable Sources of Energy andstressed upon the ECO Secretariat todevelop association with the internationalorganizations particularly UNDP, UNIDO,World Bank (WB), Asian DevelopmentBank (ADB), Islamic Development Bank(IDB), United Nations Economic andSocial Commission for Asia and thePacific (UNESCAP) etc. in this field.WorkshopIn the Workshop the participants madepresentations on the following topics:Wind Power Industry DevelopmentStrategyWind Energy, Preparation of WindEnergy Resource Assessment ProjectIntroduction to Wind TurbineComponents and Installation of WindFarmsIntroduction of Iranian CompaniesInvolved in Wind Energy SectorThe representatives of the Iranian companies(Niroo Research Center, SabaNiroo Company, Moshanir PowerConsultant, MKS International Ltd andParaye) involved in the wind energy sectormade their presentations and underlinedthe background information of theestablishment of their companies and thefunctions, responsibilities and the servicesbeing rendered by them in the field ofwind energy as well as elaborated thefields of their competence. The representativeof the Islamic Republic of Pakistanpresented national report highlighting theresearch achievements in renewablesources of energy and briefed the participantsabout Pakistan's potentialand future plans in this field. Healso shared with the participantsthe incentives being offered tothe prospective investors in thealternate energy sector. Hestressed the need for a closercooperation among the ECOMember States in the field ofrenewable energy resources.ECO CHRONICLE17

Bonn InternationalConference on AfghanistanECOCHRONICLEThe SecretaryGeneral on December5, 2011 participated in the InternationalConference on Afghanistan held in Bonn,Germany. The Conference was attendedby more than eighty Member States ofthe United Nations including theSecretary General of UN, H.E. Mr. Banki-moon. The Bonn Conference waschaired by His Excellency Mr. HamidKarzai, the Honorable President ofAfghanistan. The final document, welcomingthe profound changes occurredin the country over the last decade,expressed overwhelming support to thecause of maintenance of peace, security,economic development and stability inAfghanistan after 2014 and pledged thatthe international community will remaincommitted to provide the necessary assistance.The Bonn Conference shall be followedby other international gatherings inTokyo and elsewhere to maintainmomentum of support for Afghanistan.The Secretary General of ECO, in hisstatement, presented short overview ofECO activities on Afghanistan andexpressed readiness tocontinue on its effort.On the sidelines ofthe Conference, theSecretary General metwith the ForeignMinisters of Azerbaijan,Kazakhstan andTajikistan on ECO'songoing activities. Inseparate meetings withthe Secretary General of the UnitedNations and the Minister of ForeignAffairs of the Federal Republic ofGermany, the ECO Secretary Generalemphasized the regional dimension ofECO as a viable mechanism for globalactivities toward progress and development.ECO CHRONICLE18Istanbul Conf. for AfghanistanSecurity and Cooperation in the Heart of AsiaECOCHRONICLEThe ECO Secretary General, on the combinedinvitation of the Foreign Ministers ofTurkey and Afghanistan, participated in the IstanbulConference for Afghanistan on November 2, 2011. The conferencewas opened by the Heads of States of the two countriesand the working session was chaired by the ForeignMinisters.The ECO Secretary General, M. Yahya Maroofi, inhis remarks expressed the support and commitment of ECOin the reconstruction of Afghanistan and emphasized on thefact that the maintenance of peace and security inAfghanistan is the cardinal requirement to ensure sustainabilityof the country and the region.The conference concluded with the Istanbul Declarationwhich outlined international action in Afghanistan followingthe drawdown of international forces in 2014. During themeeting the Secretary General called on Hamid Karzai, theHonorable President of Afghanistan, to brief the President onthe ECO activities in Afghanistan.

NewsECOPolice Chiefsto ReinforceJoint Coop.ECOCHRONICLEThe First Meeting ofChiefs of Police ofECO Member States was held inTehran, the Islamic Republic of Iran,on November 23 - 24, 2011, hostedby the Police of Iran.The Meeting was attended by delegatesof Afghanistan, Azerbaijan, Iran,Kazakhstan, Kyrgyzstan, Tajikistan,Turkey, as well as the ECO SecretaryGeneral. Brigadier General IsmailAhmadi Moghaddam, Commander InChief of the Police of Iran addressedthe inaugural session.The Chiefs ofPolice Meeting was preceded by anExperts Group Meeting for finalizingnecessary formalities/documents forestablishment of ECOPOL.The Heads of delegation expressedtheir commitment to enhance jointcooperation to eradicate the menacesof drugs, terrorism and organizedcrime within the regional context. Theparticipants agreed that in order tocontribute effectively to regional andglobal efforts for combating drugs, terrorismand transnational organizedcrime, there was a strong need forexchange of information and sharingbest practices among all the stakeholdersof the police organizations of theECO Member States.ECOCHRONICLEThe ECO SecretaryGeneral attended thefirst Meeting of the ECO High LevelExpert Group on Human ResourcesDevelopment held in Tehran onNovember 21-22, 2011. In his openingspeech, while underlining the importanceof the human resource development,he referred to the Article II (h) ofthe Treaty of Izmir, the founding Charterof ECO, which identifies "developingjoint programs for human resourcedevelopment in ECO region" as one ofthe objectives of the Organization.The Member States have been collaboratingto accelerate the pace of regionaldevelopment through their commonendeavors. Underlining the importanceof the human resource development, hereferred to the Article II (h) of the Treatyof Izmir, the founding Charter of ECO,which identifies "developing joint programsfor human resource developmentin ECO region" as one of the objectivesof the Organization. He stressed uponthe Member States for collective effortsand regular exchange of experiences inthe field of Human ResourcesDevelopment.Dr. Lotfollah Frouzandeh,Vice-President for Management andHuman Capital Development of theIslamic Republic of Iran inaugurated theECOArrangesHumanResourceDevelopmentMeetingMeeting. During two days Meeting theparticipating Delegates highlighted theircountries' positions on the HumanResource Development reflecting theorganizational structure, recruitment,promotion policies, systems for performanceevaluation/ appraisal of theemployees, functions and responsibilitiesof their respective departments involvedin this field, socio economic situation oftheir respective countries and discussedthe challenges confronting them.They also exchanged information andexperiences on the most importantissues of Human Resource Developmentsuch as Recruitment System, TrainingSystem, Compensation System, DownsizingGovernment Structure,Strengthening the Monitoring &Controlling Role of Government, PrivateSector Partnership, ElectronicGovernment, and PerformanceAppraisal.It was decided that the 1stMinisterial Level Meeting on HumanResource Development ("The FirstMeeting of the ECO Ministers/Heads ofthe HRD ResponsibleOrganizations /Commissions") be held in October /November 2012. The Islamic Republicof Iran offered to host the MinisterialLevel Meeting which was appreciated.Other interested Member State can conveyits readiness to host the said Meetingto the Secretariat in two months time.ECO CHRONICLE19

ECO CHRONICLE20ECOSurveying& MappingOrganizationsexchangedviews andexperiencesECOCHRONICLEThe representativesof nine countries ofAfghanistan, Azerbaijan, Iran,Kazakhstan, Kyrgyz Republic, Pakistan,Tajikistan, Turkey and Turkmenistanattended the first Meeting of ECO Headsof Surveying and Mapping Organizationsheld on September 26-27, 2011 inTehran. Hosted by the Iranian NationalCartographic Center, the meeting discussedlatest developments & technologies,exchanged views and experienceson a wide range of issues including geodeticnetworks and earthquake topographicmapping, remote sensing andphotogrammetric activities and hydrographicactivities as well as future regionalcooperation among ECO countries inthe field of Surveying and Mapping.Thehost country gave detailed presentationsof their achievements and provided theparticipants with information about theirfacilities. New proposals were also consideredfor the improvement of theMember States' future cooperation.ECOHoldsWorkshoponDrugRelatedIssuesECOCHRONICLEECO-Drug andOrganized CrimeCoordination Unit (DOCCU) organizeda workshop on drug related issues inthe Region on September 5-8, 2011.The Workshop held at the AntiNarcotics Police Headquarters of Iranin collaboration with the Iran'sInternational Police Department andthe European Union, deliberated onissues of drug concealment and searchingtechniques and the routes of drugtrafficking in the ECO Region. Theworkshop mainly aimed to increase thecapacity and level of expertise of antinarcotic forces of the ECO MemberStates.Law enforcement and customs officialsof Afghanistan, Azerbaijan, Iran,Kyrgyz Republic, Pakistan, Tajikistanand Turkey, representatives of the ECOSecretariat and the UNODC-PortControl Unit of Pakistan Segment of

NewsKarachi attended the workshop.Faculty Members of the InternationalPolice University of Iran delivered lectureson the subject with the maintheme of the lectures being the introductionof different kind of drugs,methods of identification, drug-concealmentmethods and searching techniques.The UNODC officials elaborated onthe Global Container Control Programand especially the activities of the PortControl Unit of Karachi, Pakistan linkingcomponent 1 and component 3 of theEU-funded Project titled Fight againstTrafficking from/to Afghanistan with theECO Member States. This project isbeing implemented with a contributionof 9.5 million Euros by the EuropeanCommission.The participants were also briefedabout concealment methods and profilingtechniques. They also visited thepermanent exhibition at the AntiNarcotics Police Headquarters of Iranand had the opportunity to visit theSniffer Dog Training Center in Karaj, acity west of Tehran.Demonstration was also made as tohow the dog with its handler performsduties of searching drugs hidden in differentparts of a vehicle.The participants expressed their sinceregratitude towards ECO-Drug andOrganized Crime Coordination Unit,Anti Narcotics Police and NCB, Tehranalso the European Union for their supportto organize this important workshop.Towards the end of the workshop, Mr.Rashidifar, Vice President of theInternational Police University of Irantogether with Mr. AbolghasemTahmasebi, Deputy Secretary Generalof ECO, awarded certificates to the participants.Trans-EurasiaVIII International Conf.ECOCHRONICLEUpon invitation of Kazakhstan's Ministerof Transport and Communications, theECO Secretary General participated in VIII InternationalConference "TransEurasia" held on November 10-11, 2011in Astana.The Conference was attended by senior officials of 42countries from transport authorities and private sector, andalso delegates from ECO, SCO, EurAsEC, EuropeanCommission, CIS T??, TRACECA, World Bank, IDB, JBIC,UIC, IRU, ICAO, IATA participated in the Conference.The Conference was inaugurated by Aset Issekeshev, VicePrime Minister - Minister of Industry and New Technologyand Berik Kamaliev, Minister of Transport andCommunications of the Republic of Kazakhstan.At the Plenary Session I of the Conference, the SecretaryGeneral shed light on ECO's major activities in the transportsector and shared future plans of ECO in the transport sector.He emphasized that, in view of advantageous geopoliticallocation of the region, a number of important rail androad projects have been initiated and implemented toestablish connectivity between Asia-Europe and China.During his visit to Astana the Secretary General called onMinister of Foreign Affairs of Kazakhstan Yerzhan Kh.Kazykhanov.ECO CHRONICLE21

ECO& D-8Sign MoUECONational CivilRegistrationto EnhanceCooperationECOCHRONICLEOn October 6,2011, the signing ceremonyof the Memorandum ofUnderstanding (MoU) betweenEconomic Cooperation Organizationand the Developing-8 Organizationfor Economic Cooperation was held atthe sidelines of the D-8 MinisterialMeeting on Industry at Istanbul,Republic of Turkey.The MoU, signed by the ECOSecretary General M. Yahya Maroofi,and Secretary General of D-8 Dr. WidiA. Pratikto, provides a basis for collaborationbetween the two organizationsin different areas of common concern,including Energy, Minerals, Trade,Agriculture, Industry, Transport, Small& Medium Enterprises (SMEs)Development, Science & Technology,Human Resource Development andEconomic Research & Statisticsthrough exchange of information,knowledge, best practices and experiences.ECOCHRONICLEOn October 3-4, 2011, the Iranian NationalOrganization for Civil Registration (NOCR)hosted the 1st Meeting of Heads of National Civil RegistrationOrganizations/Centers of ECO Member States. Representativesof diplomatic missions stationed in Tehran including Afghanistan,Azerbaijan, Iran, Kyrgyz Republic, Pakistan, Tajikistan and Turkeyparticipated in the event.While briefing the meeting about the historical background ofthe Civil Registration Authorities of their respective countries, theHeads of delegations also highlighted the organizational structure,objective, activities, future plans and projects and bestpractices. They also discussed the challenges being faced bythese Organizations and expressed their commitment toenhance cooperation among these Organizations of theMember States and encouraged the continuity in exchange ofinformation. The participants shared experiences and best practicesin their respective countries on the most important topicsof civil registration such as registration of vital events, productionand release ofECO CHRONICLE22

NewsECO/Mercosurto Bolster Tiespopulation statistics and information such as National Code(ID Number) and Smart Cards, promotion of safety and securityfactors of issued documents, civil status registration and E-Government.The Meeting deliberated on the issue of educational andresearch co-operations and decided to establish a trilateralworking group comprising of Iran, Pakistan and Turkey in collaborationwith the ECO Secretariat to coordinate and identifythe main headlines and topics for educational and researchcooperation among the ECO Member States. The WorkingGroup also worked out on finding the possible financialsources for materializing this proposal.Meanwhile, the I.R. of Iran expressed its readiness to organizevirtual training courses for the experts of the interestedMember States. It was also agreed that the above TrilateralWorking Group in coordination with the ECO Secretariatwould consider all the suggestions and possibilities of theestablishment of ECO national registry authority's website, itscontents and components.The Meeting underlined the importanceof (i) on-time registration of vital events (ii) production ofIdentity Documents (iii) Production of population statistics &information and requested Iran, Pakistan and Turkey to becoordinators of these issues respectively and prepare someproposals for enhancement of cooperation in the above areasto be presented to the next meeting of Heads of CivilRegistration.Introducing of focal points in the field of CivilRegistration and conducting of study tours to witness theprogress made in the field of Smart-Card as well as holding ofworkshops / expert group meetings in the priority areas of CivilRegistration were also discussed.As a sideline program of the Meeting, the Iranian InteriorMinister launched an exhibition depicting the historical backgroundand achievements of the Iranian National Organizationof Civil Registration.ECOCHRONICLEOn October 2, 2011, a one-day Seminarwas held in Tehran on the ways of fosteringcooperation between ECO and Mercosur.While delivering his inaugural statement, the Iranian DeputyForeign Minister for European and American Affairs, Ali Ahani,highlighted the significance and areas of cooperation betweenthe two organizations.Pointing to the huge capacities of theMember countries due to their strategic locations in the region,Ahani stated, "if these countries unite and employ their potentials,they could play a key role in global developments andgain much more bargaining power"."Both ECO and Mercosur can manage to play a role", heunderlined. Ahani further added, "cooperation can go beyondeconomic sphere and focus on political and cultural matters aswell". The ECO Secretary General, in his address, informed themeeting about ECO's activities in various fields and emphasizedthe need for cooperation between the two organizations in theframework of South-South cooperation. He also assured ECOSecretariat's fullest support and assistance towards materializingthe cooperation. While appreciating the initiative, theAmbassador of Uruguay, current Chairman of the Mercosur,pledged to follow up the plans and programs for cooperationbetween the two organizations. It was decided that a WorkingGroup comprising representatives of the two sides should beestablished to explore the possibilities and areas of cooperation.Mercosur (Southern Common Market) is an economic andpolitical agreement among Argentina, Brazil, Paraguay andUruguay. Bolivia, Chile, Colombia, Ecuador and Peru currentlyhave associate member status. Founded in 1991 by the Treatyof Asuncion, it was later amended and updated by the 1994Treaty of Ouro Preto. Its purpose is to promote free trade andthe fluid movement of goods, people, and currency.ECO CHRONICLE23

ECO Bank'sVice President confers withECO Secretary GeneralECO CHRONICLE24ECO S.G.Participates atCOMCECMeetingECOCHRONICLEThe StandingCommittee forEconomic and Commercial Cooperationof the Organization of the IslamicCooperation (COMCEC) held its 27thsession on 17-20 October 2011, inIstanbul.As observer, ECO S.G. participated atthe meeting, which was inaugurated byPresident Abdullah Gul of Turkey.The session reviewed issues includingthe implementation of the OIC Ten-YearProgram of Action, world economicdevelopments with special references toOIC member countries, intra-OIC trade,poverty alleviation and enhancing relationswith private sector.On the sidelines of the meeting, ECOS.G. was received by the PresidentAbdullah Gul and met with the SecretaryGeneral of OIC, Prof. EkmeleddinIhsanoglu.ECOCHRONICLEDr. Yasar Akgün,Vice President andthen Acting President of ECO Tradeand Development Bank visited theECO Secretary General on October24, 2011. The two sides discussedways of increasing the Bank's operationalactivities, improvement of thepresent status of cooperation betweenECOSAConf.ExploredECO RoleECOCHRONICLEThe 3rd ECO SeedAssociation (ECOSA),the International Seed TradeConference (ECOSA-2011) and the3rd Meeting of ECOSA Board ofDirectors (BOD) were held in Istanbul,Turkey on November 16-20, 2011.More than 200 private sector representativesand seed sector specialistsfrom the ECO Member States andnon-ECO countries participated in theECOSA -2011 which provided anopportunity for the participants forreviewing the status of global andregional seed industry, learning aboutsuccess stories in the region, exploringregional trading opportunities andmaking business contacts.the two via focusing on trade financingand initiating regional plans andprojects.The two sides also talkedabout membership conditions andpotential of attracting newmembers.To maximize Bank's fundingability,Secretary General suggestedpromoting of relationswith other financialinstitutions.ECOWorkshoponConformityAssessmentECOCHRONICLEThe First ECOWorkshop onConformity Assessment was held inTehran on 16-17 October 2011 atECO Secretariat. The Workshop providedthe participants an opportunity toshare experiences and exchanging theviews for exploring the areas of cooperationand ways of collaboration in ECOregion in line with international regulationssuch as ISO/IEC/17000. The participantsdiscussed areas of ECO intereston the areas of Testing andCertification of Products, Inspectionand Certification of ManagementSystems and Persons with a particularemphasis on the experience of I.R. ofIran.

NewsECOCHRONICLEOn 24September,2011 and on the sidelines of the66th Session of the UnitedNations General Assembly, theAssociation of the SoutheastAsian Nations (ASEAN) and theEconomic CooperationOrganization (ECO) held their11th Joint Ministerial Meeting inNew York.Foreign Ministers /Representatives of ECO andASEAN Member States andSecretary Generals of the twoOrganizations were present atthe Meeting which was cochairedby HOR Namhong,Deputy Prime Minister, Ministerof Foreign Affairs andInternational Cooperation of theKingdom of Cambodia, and Dr.Ahmet Davutoglu, ForeignMinister of the Republic ofTurkey, on behalf of ASEAN andECO, respectively.While reviewing the advancementof the implementation ofdecisions taken at its 10th edition,the Meeting exchanged viewson the present status of joint cooperation between the twoOrganizations. The two sides also laid emphasis on the needto speed up the execution of jointly developed Work Programand the MoU so as to make their relationship more fruitfuland meaningful. The Co-Chairs also appreciated the holdingof the 11th ASEAN-ECO Ministerial Meeting in their remarksat the outset and noted that the Meeting offered a constructiveforum for exchange of views on matters of mutual interestconcerning ASEAN-ECO partnership and also to maintainmomentum for the reinforcement of their relationship. TheCo-Chairs then highlighted the existing cooperation potentialbetween the two Organizations and resolved to translate itinto tangible actions in the spirit of friendship, cooperationECO-ASEANMinistersCall Attentionto MoreCooperationand mutual benefits.The Meeting also suggested thatin addition to the biennial ministerialmeeting being regularlyheld on the margins of the UNGeneral Assembly in New York,another biennial ministerialmeeting be held alternately in anASEAN/ECO Member State tofurther expand the bilateralcooperation; establish the tacticalvision of a two-way relationshipbetween ASEAN and ECO;supervise the status of their directives'performance and also togive further direction for fosteringthe ongoing relationship betweenthe two Organizations.Convening a senior officialsmeeting featuring all MemberStates of the two Organizations,organizing a business forum withthe participation of private sectorfrom the Organizations' MemberStates and encouraging theECO/ASEAN economic ministersto meet was also agreed at theMeeting.The two sides also encouragedthe accreditation of theAmbassadors of all Member States to ASEAN and ECOrespectively as well as regular interaction among thePermanent Missions of ASEAN or ASEAN New YorkCommittee and ECO Member States in New York to discussissues of common relevance in the Agenda of the UnitedNations. The Meeting directed the Secretary Generals of thetwo Organizations to take early steps, through regular mutualconsultation, for practical activation of cooperation in theareas of Trade and Investment, Small and Medium EnterprisesDevelopment, Narcotics Control and Tourism as envisioned inthe MoU and the Work Programme as well as in other areasof mutual interest. ASEAN and ECO are also looking forwardto promotion of inter-regional connectivity.ECO CHRONICLE25

EPGEvaluatesECO PerformanceOECO CHRONICLE26n 03-04 October, 2011, the 2nd Meeting of the3rd ECO Eminent Persons Group (EPG) was held inthe Headquarters of ECO Secretariat in Tehran.Present at the meeting were eminent personalitiesfrom seven ECO Member State of Afghanistan, Azerbaijan,Iran, Pakistan, Tajikistan, Turkey and Turkmenistan. TheMeeting was chaired by Ambassador Numan Hazar, Republicof Turkey and Associate Professor Sohrab Shahabi (theIslamic Republic of Iran) acted as Vice Chairperson-cum-Rapporteur.In his inaugural remarks, the ECO Secretary General welcomedthe participants and said that while having theincreasing role of ECO as a competent instrument to secureprogress and security in the region in mind, there must be acollective endeavor for eliminating the deficiencies andobstacles on the way of ECO's progress and strengthening thespirit of cooperation in the region for realizing organizationalcommitments and duties.Also, Ambassador Numan Hazar, Chairperson and representativeof the Republic of Turkey to the EPG, while deliveringhis speech, underlined the importance of the 3rd EPGprocess for enhancing dynamism, efficiency and visibility ofECO.In keeping with its mandate, the Group deliberated on differentsubjects pertaining to the Organization's performanceand suggested ways and means to enhance ECO's dynamism,efficiency and visibility.The meeting was concluded with appreciation remarks bythe Group towards the ECO Secretariat for making excellentarrangements for the Meeting and extending hospitality tothe participants.The Eminent Persons Group (EPG) of the ECO was estab-

Special Reportand procedures, etc.);"Considering the sufficiency of the available financialresources for implementation of the envisaged plansand activities;"Evaluating the Secretariat performance;" Assessing the efficiency of communication betweenSecretariat and member states;"Examining national mechanisms for enforcement /implementation of ECO agreements/projects with aview to enhanced participation of member states inECO activities;"Studying basic documentation of the ECO regionalinstitutions/specialized agencies/units and their performancewith the view to their better functioning. Giventhe increasing number of ECO regional institutions/specializedagencies/units, to consider possible mergingand to set criteria/modalities for establishment of newECO entities;"Evaluating ECO's cooperation with otherregional/international organizations and contributionsthereof to ECO's activities, goals and objectives;"Identifying inhibiting factors for realization of theobjectives of ECO as enshrined in the Treaty of Izmirand the other documents;"Identifying factors which led to low participation bysome Member States in ECO activities;"Identifying the challenges and opportunities emergingfrom new regional/international developments and theirpossible impacts on the ECO's future;"Taking any other initiative necessary for realization ofthe EPG's objectives.lished to "study and review thework of the Organization includingthe ECO Vision 2015 in orderto enhance the dynamism, efficiencyand visibility of theOrganization and provide recommendationsto be submitted tothe Council of Ministers."EPG's scope of work includes:"Examining all ECO's basic andregulatory documents as well assectoral strategies, programs, andaction plans;"Conducting a thorough reviewand evaluate the overall performanceof the Organization in differentsectors during the last twodecades;"Conducting a SWOT analysis ofthe ECO's institutional capacity(organizational structure/chart,staff strength, recruitment policyECO CHRONICLE27

“EPG OffersHistoric Opportunity”Highlights of the Statement byECO Secretary General“I welcome you tothe inaugural meeting ofthe ECO Eminent PersonsGroup (EPG) and expressmy gratitude to theMinistry of Foreign Affairsfor convening your initialmeeting in Ankara.Thus, materializing theidea of the establishment ofthe Eminent Persons Groupwhose study of ECO and itsspecialized agencies andresulting recommendationswill hopefully contribute torendering the organizationa more effective body andits activities conducive toregional integration andcooperation.”ECO CHRONICLE28“This Meeting marksthe beginning of a significantprocess for ECO for itwould pave the way forushering our Organizationinto an era of acceleratedeconomic prosperity, wouldequip it to surmount thechallenges of the currenttimes and transform it intoa dynamic and efficient

Special Reportvehicle to achieve socioeconomicuplift of the region.“We are all aware of theimportance of the goals of the EPGprocess. In the main, this Group willstudy and review the work of theOrganization, revise the ECO Vision2015 and give recommendations tothe Council of Ministers toenhance the dynamism, efficiencyand visibility of theOrganization.”“At this point, Iwould place on recordmy sincere thanks to theMembers of the EPG formaking themselves availablein this importantundertaking despite theirbusy schedules.Their varied experience,deep knowledge and diversebackgrounds bring gravitas tothe process and raise ourexpectations and hopes.”"Economic CooperationOrganization (ECO) in its 26 years ofexistence has made good progressand has achieved recognition as animportant Regional Organization.There is no denying the fact thatECO is embodied enormous potentialof regional cooperation.Nevertheless, despite this hugepotential, we are far from achievingour rightful status of eminence.”“Against this backdrop, theECO EPG offers an historic opportunityto evaluate our performance.The recommendations of the EPGwould certainly have critical bearingon the future of ECO as a robustregional organization with thecapacity to achieve the desired socioeconomicgoal through regionalcooperation.”“We expect that the EPG's recommendationswould invigorate andenergize the organization its ongoingefforts and at the same time comeforward with proposals to equip theorganization to meet challenges thatlie before us.”“The challenges such as the differencesand reservations amongstthe ECO Member States on differentinitiatives but hope to find commongrounds through multilateralism tomove forward and forge aheadregional integration as environedin the Treaty of Izmir.We wish to enhance ourunderstanding of the needs ofthe Member States so as tobetter serve their interests.We wish to find ways toencourage active participationof the Member Statesand focus on more essentialand effective fields of developmentin the Region andprepare ourselves to effectivelymeet the challenges of sustainabledevelopments in theinternational arena.”“In conclusion, I have full confidencethat this Group would identifythe factors inhibiting realization ofECO's objectives, the challenges andopportunities confronting theOrganization, expectations emergingfrom new regional/internationaldevelopments and their possibleimpacts on the ECO's future. I lookforward to working closely with youin our common endeavors."ECO CHRONICLE29

Where do you think are ECO's areas ofstrength?ECO enjoys membership of countries that possess vastnatural and human resources and bound by strong historicand cultural ties. The region constitutes an energy andtrade corridor of great importance linking Europe to theFar East and trading partners in the north to the warmwater ports of the south.As an Organization, ECOprovides an important platformfor leaders in the region to meet and exchange views ontopics of mutual concern and has been instrumental ininstitutionalizing sectoral meetings, promoting coordinationand advancement of cooperation on areas such as trade,transport, energy, agricultural and trafficking. In short, ECOoffers a platform for dialogue and venue for exchange onconstructive and effective ways to promote regionalgrowth and integration.Some critiques believe ECO's capacityis much more than the present level.Do you agree with this assertion?Yes, indeed, we can say, that ECO has gainedimportant recognition as a regional organizationwhich can play a vital role in the economies ofthe region and its development. It has establishedimportant links with other regional economicorganizations and areas of cooperationwith major international organizations.ECO CHRONICLE30“We Must Move towardsConcrete Initiatives& Actions”Sorayya Maroofi (Afghanistan)Member of EPG - 2011

Special ReportHowever, compared to its great potentials its achievementshave been relatively modest. Some headway has beenmade in transport and communications and trade and transitagreements and the establishment of the ECO Trade andDevelopment Bank can be regarded as a significant milestone,but we have a long way to go before we can considerourselves a vibrant interconnected and integrated entity.It is important that we do not lose sight of our commonobjectives and make serious effort to overcome impediments.As a member of EPG, what are youroverall suggestions/ recommendations forfuture long-term strategies/plans for ECO?Any future long-term strategy or plans must have solidlinks between national and regional plans. They must haveeffective measurements for impact and established benchmarksas well as the necessary commitment by memberstatesto develop and monitor agreed programs and plans ofaction. At the same time, strategies must foresee resourcesto help backward economies catch up with the moreadvanced economies in their implementation. In my opinion,the most important challenge in the years to come willbe to move from conservative to an active approach toachieve economic integration and seek common grounds toexplore potential opportunities for the prosperity and stabilityof the region. We must promote the reality that peaceand prosperity of the region are interdependent. Unrest, beit political or economic can adversely affect our collectiveefforts towards economic growth and advancement of theideals that have brought us together.What do you consider the main challengesfor ECO's growth?The strength of any regional organization rests on thecommitment and resolve of its members. Vision declarations,Strategies, Action Plans are easy to formulate onpaper. However, it requires determined effort to realizedesignated goals and objectives. It is important that membersconduct continuous and serious exchanges amongstthemselves and with the ECO Secretariat on ECO programsand activities through designated ECO national coordinationunits and build the technical capacity and necessaryinfrastructure to successfully achieve adopted Plans ofAction and approved sectoral projects.Only through the serious and active participation of allMember-States can ECO attain its objectives of sustainabledevelopment. We must move from rhetoric and grand declarationsto concrete initiatives and actions. While it isimportant to set long-term goals, it is essential that realisticintermediate targets are focused on in which membercountries have clearly shared interest and ownership of theprocess.The cooperation process must not be burdened by overlyambitious projects but limited to issues where progress isfeasible and in which all members have a stake. The differencesin stages of economic development of member statesmust be taken into consideration when formulating sectoraland regional infrastructural development projects. At thesame time, it is important to ensure that the organizationpossesses the necessary tools and resources to discharge itsmandate.Effective leadership and competent staffing as well as realisticbudgeting are crucial if ECO is to successfully dischargeits responsibilities. Geographic representation must not takeprecedence over competence. At the same time, Member-States must be diligent that the composition of the secretariatdoes not become overly represented by a few.They should make every effort to ensure that importantvacancies receive extensive announcements both within theprivate and public sector as to ensure quality selectionamong a wider circle of applicants. The EPG will concentrateon this process at their next meeting. However, it wasgenerally felt that a thorough review of the organizationalstructure and decision-making process were required toenable the Secretariat and its agencies and affiliates toeffectively discharge its mandate and responsibilities.How do you realistically foresee ECO'sdevelopmental trends and future prospects?Future trends will heavily depend on the global economyas a whole. The world financial sector is in crisis and in direneed of reform. It is inevitable that this wind of change willheavily affect our region as well. We must all learn animportant lesson from recent events. There are no proveneconomic systems and no crystal balls. However, the importantlesson to be learned from the recent outrage is that theworld's wealth should not be the monopoly of the few, thatwe must be collectively responsible and shoulder responsibilitiesand ensure a more just and equitable distribution ofresources.We must learn to empower each other and make maximumuse of our limited resources. The fragility of the globaleconomy, our environment and interdependency must beat the forefront of our endeavors in any strategic plans forthe future. This EPG Member is a strong advocate of establishingThink Tanks within each member state to study andcome forward with concrete proposals on developmenttrends and future prospects.What role can ECO Cultural Instituteplay to publicize and improve ECO image?The ECI has proved most dynamic in bringing the peopleof the ECO region together through programs and activitiesthat have emphasized their common cultural and historicalheritage and infusing a sense of pride in their traditions andculture.It has played a vital role in reviving the glory of theregion's past through exhibitions and seminars on scholarsand poets of the past as well as organizing theatrical eventsin the west that pay tribute to the region's artistic and musicaltalents.ECO CHRONICLE31

In your opinion where are ECO'sareas of strength?I certainly believe that ECO has a great capacity.First ECO is an important organization. It covers avast geographic area. Another significant featureis that there is an affinity and very close culturalinteractions among the memberstates.Member states are rich in naturalresources and energy. They possess apositive economic variety which canhelp a flourishing future based on economicand social development. Allthese indicate that there is a greatpotentiality for the success of theorganization.As a member of EPG,what are your overallsuggestions/ recommendationsfor futurelong-termstrategies/plans for ECO?Basically, ECO is a technical organization not a political one. ,aimed at realising close economice and technical cooperationand integration among member states. Indeed, from the verybeginning, the Organization has been able to bring about andto complete many significant projects.In todays world, however, it is not possible to make a satisfactoryassement in view of and as compared to the high potentialityof member states which could, undoubtedly, carry out morein their cooperation in all fields where ECO might have importantstakes. ECO can do much better. When the organization ismuch more active, this will serve best interets of all membercountries. EPG's mandate , as defined in Istanbul Declaration of23 December 2010, is to study and review the work of theorganization including the ECO vision of 2015 in order toenhance the dynamism, efficiency and visibiliity of the organizationand provide recommendations to be submitted to theCouncil of Minister (COM).I personnaly suggest an increase of the budget together withother measures, taking into account the experiences of otherinternational organizations such as an external auditor mechanism,surmounting difficulties in present decision-makingprocess, improvement of Secretarat ( financing, power etc for amore active and dynamic functioning). I also suggest to givepriority to full implementation of ECO Trade Agreement and toenhancing membership of the ECO Trade and DevelopmentBank to achieve tangible progrees in ECO's agenda. In this context,I believe, we should also encourage the payment ofarrears and involvement of all member states in all ECO activities.How do you realisticallyforesee ECO's futureprospects?I see a bright future for the ECOwhen we gain a dynamism, efficiencyand visibility .ECO CHRONICLE32“Bright Future for ECO if We GainDynamism, Efficiency& Visibility”Numan Hazar(Turkey)Member of EPG - 2011

Country ReportNeutrality Day is, in fact, the second most important nationalholiday in Turkmenistan after Independence Day. Judging bythe political, economic, legal, and social implications of thisstep the choice the country made 15 years ago was, withoutexaggeration, historic and crucial.A simple declaration of neutrality could not ensure internationalsecurity guarantees. That is why the country created anunprecedented mechanism of coordinating its neutral aspirationswith the international community.As a result, Turkmenistan was the first country to obtain theinternational status of neutrality through consensual agreementof all UN member states. It happened, on December 12, 1995in New York, during the UN General Assembly session, whereall 185 UN member states, without exception, voted for theadoption of the special resolution titled "Permanent neutralityof Turkmenistan".By gaining a new status, neutral Turkmenistanundertook certain obligations to the internationalwas an opportunity to successfullyaddress issues of national economicdevelopment. Neutrality, from theeconomic and legal point of view,was instrumental in attracting foreigninvestments in major economicprojects to develop mineralresources of the Turkmen land andtake its energy resources to theworld markets.Today, according to theWorld Bank, in terms of thelevel of foreign direct investmentper capita,TurkmenistanranksTurkmenistanCommemoratesNeutrality Daycommunity. These are non-alliance with political, economic,military alliances and blocs; presence of army only for protectionof peace and freedoms; renunciation of weapons of massdestruction; prohibition of transportation of such weapons byland and by air of the country; commitment to universal values,principles of democracy; guarantee of civil peace in thecountry; conducting own policies in close cooperation with theUN and humanitarian international organizations.The unconditionalrefusal to participate in international military and military-politicalgroupings and blocs allowed Turkmenistan toavoid being drawn into any form of military confrontation inthe region, while ensuring its own security guarantees thatwere confirmed by the entire international community.In accordance with the Declaration "On InternationalObligations of Neutral Turkmenistan" in the sphere of HumanRights adopted on December 27, 1995, Turkmenistan undertookadditional commitments in this area.The institutions of democracy and human rights are continuouslydeveloping in modern Turkmenistan in full accordancewith the country's obligations. The country's prestige as anactive conductor of ideas and programs of the UN in globalpeacemaking processes has also increased. It was not accidentalthat Ashgabat was selected as a place for dislocation of theRegional Centre for Preventive Diplomacy for Central Asia.Another major effect of implementing a policy of neutralityamongst the countries with themost favorable investment climate.Duringthe recent years,according to its positive neutral policyTurkmenistan has offered newmethods to resolve regional andinternational challenges and problems.These methods were mentionedby GurbangulyBerdimuhamedov, president ofTurkmenistan, in the 64th, 65thand 66th general assembly of theUN.In addition, the president ofTurkmenistan explained the conceptof peaceful coexistence andstable development in the CentralAsia complex region to the globalSociety.There is no doubt that withthe evolution of our neutral statusand strengthening of its understandingby the international communityas a reliable way to achieve security,the level of international politicalconfidence in Turkmenistanincreased significantly.ECO CHRONICLE33

Born on April 1961 in Balikesir, Turkey,Ambassador Umit Yardim graduated inPolitical Science and International Relationsfrom Bogazici University, Istanbul. He didhis graduate work in International Relationsat Gazi University, Ankara on question ofPalestine. He holds an honorary Ph.D inIslamic Architecture in Balkans.Yardim started his professional career inthe Foreign Ministry of the Republic ofTurkey in January 1985. He was Turkey'sConsulate General in Stuttgart, Germanybefore his assignment as Turkey'sAmbassador to Iran in April 2010. ECOChronicle’s Editor had an opportunity tointerview Turkey's top envoy to Iran.ECO CHRONICLE34We are at the threshold of 88thAnniversary of the Proclamation of theRepublic of Turkey, what have beenTurkey's major achievements during thisperiod?I find it difficult to just summarize the achievementof Turkey, because after all we are speaking about 88years of Turkish Republic, it is really a big story, butjust to have a framework I can give you some hintwhich would hopefully shed some light on the subject.To begin with, one should ask how Turkey's situationwas at the beginning of last century andwhere it is now. At the start of last century, Turkeywas a country of poverty, disintegration, beinginvaded by foreign powers which turned anEmpire into a very small devastated Turkey, theAnatolia of Turkey. I would like to say that Turkeywas a martyred political power. It was a countrywith almost zero economy, where a needle hadto be imported from outside, where industryand services were almost nil, one or two percentmaximum.We are a generation which our forefathershad to develop every thing from the scratch;it was the rise of Turkey from the beginning.We are the third generation of the Republic;we all grew up learning about unbelievablestories by our grandparents. Even during myown life, electricity was introduced when Igot to the high school, so imagine the burdenof the previous generations.Now letme provide you with some interesting statisticsabout today's Turkey. In terms ofPurchasing Power Parity that is the buyingpower, Turkey stands 16th in theworld. In terms of EconomicUmit YardimAmbassador, Republic of Turkeyto TehranExclusive Interview

InterviewPower(Condition of having sufficient productiveresources at command that give the capacity tomake and enforce economic decisions), it is the 8theconomy of Europe, so it is better than some of themembers of the European Union.Ten years ago our GDP (Gross domestic product)per capita was $3500, now after 10 years our GDPper capita has reached to $10,000. (GDP refers tothe market value of all final goods and services producedwithin a country in a given period and GDPper capita is often considered an indicator of acountry's standard of living).We are doing best inagriculture which is more industrialized now. We arenot exporting wheat to outside world which was thecase in the beginning of the Republic. We importsome agricultural goods but export agriculturalmachineries like many of the developing countriesof the world.According to Organization for Economic Co-operationand Development (OECD) , (an internationalorganization helping governments tackle the economic,social and governance challenges of a globalisedeconomy), in the coming 5 years, Turkey willbe one of the most rapidly developing economy inthe world between 2012-2017.In the constructionWhat is more important than these figures and numbersis that for every inch of development which Ihave just summarized, there were the hard work,devotion and dedication of the Turkish peopleinvolved.This is a glimpse of our success story ineconomy; these achievements happened afterdecades of devastating war with foreign powerswhere we lost millions of our people. The loss ofTurkish population only in the 19th Century wasaround 5 million people. That figure may not lookthat many in terms of today's population but in realityand in the context of those times, indeed that is ahuge loss of precious lives of our people.So what is Turkey's goal for thefuture?With today's economy of Turkey, we are trying tobecome a regional and hopefully with the humbledEurope, a global power.This is a very ambitious goal butcan you reach this goal by mere economicmeans?“We ShouldTake LessonFrom the Global Financial Crisis”of ships and yachts, turkey is 7th in theworld and in motor production, Turkey is16th in the world. In the field of construction,Turkey ranks 2nd or 3rd globally. Intourism, Turkey is one of the top 10 mostdeveloped countries in the world. Onlylast year, 30 million tourists visited Turkey,an incredible number indeed. For the year2030 which coincides with the 100Anniversary of Turkish Republic, our targetis very ambitious, we expect 50 milliontourists to visit Turkey. We would like ourGDP to hit more than $25000. Our lastyear's trade volume was around $320 billions.We anticipate our Trade Volume in2023 reach around $1 trillion, ten timesthe size of our today's Trade Volume!Of course for a balanced and developed country,economic power, political and cultural power shouldgo hand in hand. What I have just summarizedabout Turkey's success story in economy, I couldalmost say the same about other fields such as political,social and cultural.ECO is now 19 years old but someare on the view that ECO's performancehas not met the expectations. Asone of the three Founding Members ofECO how do you asses ECO's performancetoday?I do believe with all my heart that ECO is in a veryimportant socio- political and geographic location. IECO CHRONICLE35

ECO CHRONICLE36don't see any other similar organization with somany commonalities shared by its members. It is aunique organization in a unique region.Of course I have never meant to compare ECOwith EU or ASEAN. In the case of EU which is in theintegration process, may be it is years ahead of ECOeconomically, but ECO as we know it today is rathera young organization, created only in 1992.Eighteen years for a regional organization whichmost of its members have been shifting their economicsystem from a centrally planned structure to afree market economy, a total change of economicapproach is not a long time. ECO is still in its embryonicstage of development, nevertheless in manyways is still ahead of many other regional organizationsin the world. Of course a number of achievementshave been materialized particularly in the priorityfields of transport and trade. ECO is slowly butsteadily assuming a special role as a regional playerand its value becomes more and more apparentwith the current prevailing international economicand financial crisis. ECO, with all its limitations, hasreally made contributions towards regional understandingand unity.On the other hand, it is a fact oflife that each organization gets itsstrength from its member countries. Ifwe don't turn all our energy into ourdevelopment, I am afraid we don't getthe desired results.As a region, we are facing problem ofpoverty, we are all together facing problemof terrorism, underdevelopmentetc. With few exceptions, the majorityof regional organizations are confrontingsimilar bottlenecks.There areother reasons which are beyond the scope of ourdiscussion today but I only pray for the days thateach member state, including Turkey becomes agreat power globally in economy and trade so thatour collective effort would contribute to strengtheningof ECO as a regional organization.Statistically, when we look at some regional orglobal numbers in the area of trade, there are reasonsto be concerned; they really leave negativeimpact on us.What are those numbers?For instance last year, out of ECO members' globaltrade, only 7% was intra trade within the ECOregion. This is something unacceptable and extremelylow for ECO region with a population of over 400million people. We have to promote and increasethis number.Another figure which I can share with you is theGDP (gross domestic product) per capita in the ECOregion which is $3500. We have to increase thisnumber.If we look at tourism globally, the number isstaggering. The tourist circulation around the worldIn the ECOregion weshould workvery hard tostrengthen ourrelations.is in the hundreds of millions but when we look atthe tourist circulation inside ECO it is hardly 3 or 4million people a year, this is unacceptable. I don'twant to compare, but only Rome or Paris has 50million tourists per year. ECO region with its fabulouscultural legacy, enriched with remarkable touristattraction sights such as Istanbul, Qonia, Esfahan,Shiraz, Samarkand, Baku, Lahore and many othersare among the areas of the world where the wholehuman heritage has been developed and couldpotentially benefit tremendously from the existinglucrative tourist market.Some ECO analyst argue thatECO's targets and goals were set veryambitious and the available means torealize them are scarce, such as budgetarymatters. What are your thoughtson this?Of course ECO has some structural issues whichwe need to resolve them at the earliest. Like budgetaryissue, decision making issue, participation levelwhich all need to be taken care ofimmediately. Since this is a process thatall the ten member countries are workingvery hard on it, I don't want to gointo their details but to make a very generalcomment, for your question I agreefrom the budgetary perspective; itshould be strengthened and powered.Hopefully the eminent persons group(EPG) focus and review these issues andcome up with concrete ideas to tacklethe problems.Would you brief us about EPG andits aims and objectives?In brief, formation of first EPG was initiated atthe 2003 ECO Council of Ministers Meeting heldin Bishkek, where it decided to set up an EminentPersons Group from among the member stateswith the objective of making ECO more effectiveand to implement the needed changes in the procedures,e.g. quorum, decision-making etc with aview to facilitating the work and progress of theOrganization. After thorough discussion and deliberationson the issue, the EPG among other decisions,agreed that ECO should have a vision strategyfor the next decade, known as "ECO's Vision2015".Second time, we also formed an EPG in IstanbulSummit last year. EPG aims at creating a newvision for ECO for the coming years, it will focuson how to turn ECO into a really economicpower, to become an effective organization

Interviewbeyond its today's border. In my view, EPG membersface real challenges; they are putting sometough questions on the table and try to find someacceptable answers. They will submit their finalReport to Baku Summit which is scheduled to beheld in June 2012.Turkey has been elected as theChairperson of the 11th ECO Summitsince Dec. 2010, till this June whenAzerbaijan is to take over this post.What have been Turkey's contributionsso far?It is the participation of all the member countriesthat project the power of the organization.Previously, Iran was the Chairperson, now is Turkey,up action on the decisions of the Summits, Com andRPC. But for me in this time period, the EPG activitiesare really a great challenge not only for theChairperson Turkey but also for all the members.Currently most ECO member statesare adversely affected by the prevailingworld financial and economic crisis.The current mass protests in the westernworld the so called "Wall StreetMovement", shows the problem is veryfundamental. What can ECO learnfrom this crisis?I agree that the global financial crisis is affectingeach members of the international community,some more and some less. Countries with biggerin June it will be Azerbaijan's turn, it is a continuousprocess, so each Chairpersonship tries to make allcontributions to make ECO a more successful organization.We are grateful to the previous Chairpersonand will be grateful to the next one.Of course eachcountry that becomes Chairperson follows a calendarwhich is organized and prepared in the Summitsof Leaders CoM, RPC (the Regional PlanningCouncil) and which is composed of the Heads ofthe Planning Organization or the equivalent ministryof the member states and CPR. But if you ask mewhat will be our main agenda this year, of course Iwould say there are enough of agendas which wecarry with the CPR, composed of Ambassadors fromthe ECO Member states, who monitor and followsize economy are more affected. For instance whenwe look at the European Union, some members aremuch more damaged than some other nations inthe world.Turkey is less influenced or affected than some EUcountries and the crisis is still continuing. No singlecountry can cope with the global crisis alone, it isimpossible. For example within the European community,some of its members would have gone intothe very serious crisis if EU was not there to supportthem. The structural relations saved them.In theECO region, we should take a lesson from this crisisand more than ever and work very hard to strengthenour relations.ECO CHRONICLE37

Iran's Portion inECOTradeMarket *Out of Iran's $26 billion USdollars non oil trade, duringthe past 3 years, only $4 billionUS dollars were tradedwithin Economic CooperationOrganization (ECO) region. In someIranian business sector there is astrong sentiment that in such a situationgovernment's special attentionis needed for improvement.According to ILNA (Iranian LaborNews Agency) ECO charter and treatiesare based on increasing economiccooperation and trade within the organizationas well as with its neighbors.Since its foundation, ECO has workedhard to develop regional trade cooperation.However, as M. Yahya Maroofi,ECO Secretary General has rightly putit: "our ideals are much higher".The ECO member countries' delegationsmeet regularly to discuss ways andmeans by which the trade barriers inthe region may be eased or removed alltogether. But, in comparison with otherregional blockings, ECO region has stilla long way to ideal improvement.Iran has always paid particular attentionas the host of ECO Secretariat toECO CHRONICLE38enhance ECO trade volume and whilethis policy has resulted in increase oftrade volume amongst nine other ECOmember states regrettably as aforementionedfigure shows the Iranian concernedauthorities need also to reconsiderIran's own trade share and policieswithin ECO region.In 2010, Iran's totalnon-oil export to ECO member Statesamounted to $3.69 billion US dollar.This figure has slightly improved anduntil recently, this has reached to $4.31billion dollars. Iran's import from ECOcountries is around $3.306 billion dollars.Amongst ECO member states thatimported goods and services from Iran,Afghanistan stands first with $1.337 billiondollars and Kyrgyzstan stands lastwith $31.733 million dollars.Meanwhile, goods and services'export from Turkey, (one of ECOfounder member states) to Iran isaround $2.455 billion dollars. withinECO region Turkey and Iran areimportant trade partners and Turkey,during the first half of 2010, importedmore than $1.854 billion dollarsworth of goods and services fromIran.Pakistan, another founder memberof ECO, stands next to Turkey interms of export to Iran with the exportvolume of $156 million dollars.The third country in line isKazakhstan. Iran imported more than$80 million US dollars worth of commoditiesfrom this ECO, Central Asianmember country. Undoubtedly ECOregion with a population of more than400 million people has tremendouspotential for regional trade. In thisregard, experts are of the opinion thatIran as the host of ECO Secretariat canplay more effective role in enhancingIran's trade with ECO member states.……........................................…* The above story has been reproducedfrom an August 23, 2011 article of EttelaatDaily

From Editor’sDeskProspects forPakistan's EconomyReasons for OptimismThere is quite a bit to feel goodabout with respect to the recentnews regarding the Pakistani economy.Here is a quick summary:1) When the floods hit, there waswidespread reporting that the budgetdeficit would hit 7% and in fact, somecommentators from across the bordereven speculated that it would reach 8%.In the Finance Minister's budget speech,it was confirmed that the budget deficitactually reached only 5.1% for the year,a far cry from 7 or 8%. This is perhapsjust one more indication that on thesubject of Pakistan, whatever negativityyou see in the press, you should generouslydiscount. This economy was ableto weather the WoT, the global financialcrisis and the floods quite well in 2010.2) The Federal Board of Revenue(FBR) has confirmed that tax revenuecollections for the year have alreadyexceeded last year's collections and aretrending up. Much has been said aboutthe low level of tax collection in Pakistanand this news is certainly very welcome.This year a major initiative has beenlaunched to further enhance tax collection.It is not unreasonable to expectthat within 3-5 years the tax collectionissue can be addressed to quite somedegree.3) Remittances continue to be atremendously important, and fast growing,source of foreign exchange forPakistan. These are funds being sent toPakistan by the 7+ million overseasPakistanis and represent the confidenceof our expatriate community in thecountry's future. For the 11 months ofthe financial year, these remittanceshave already crossed $10 Billion andsince we've had multiple consecutivemonths each accounting for more than$1 BN in remittance receipts, it is notunreasonable to expect the year to closeat or above $11BN. Not only is thisalmost 30% up from the previous year, itis also an all-time record.4) While the NASDAQ and Dowhave given up all their gains for the year,the KSE (Karachi Stock Exchange) isdoing quite well. In fact, it closed yesterday(6/13/2011) at 12,353 which iswithin about 300 pts of its 52-wk high of12,768.There's quite a bit of other positivenews with respect to development projectsand the increases in provincialdevelopment spending, but we'll savethose updates for another post. For now,the economy seems headed in a gooddirection.Editor’s Note:ECOCHRONICLEThe views expressedand data containedin this publication are provided by writers/authors from ECO member countriesor from outside the ECO region,and are not necessarily those held oragreed by the ECO Secretariat or ECOChronicle Editorial Board.ECO CHRONICLE39

Dollar Diplomacy vs.Energy DiplomacyBy: Sam Barden*ECO CHRONICLE40As the G20met in Cannes,France, onNovember 3,2011 there wasmuch hope for amagical solution tothe Greek debt crisis.Of course, before thesummit got underway, Greeceannounced a referendum onwhether it wanted the debt reliefbeing offered, which meant thatthere was no hope for a solution atthe G20 meeting. That meant nosolution to Europe, or the rest ofthe western financial world's debtcrisis. Nevertheless, the leaders ofthe G20 continue to surf the waveof chaos that is dollarpolitics and theglobal debt crisis, lookingto solve the world's debtproblems by issuing more debt,linked to austerity measures.There was another meeting last week. It was in Tehran,Iran. The meeting was held by the IIES (Institute forInternational Energy Studies). In fact it was their 15th Annualconference, and I, along with my college, Chris Cook, werekey note speakers. We were in good company. Also speakingwas the OPEC (Organization of Petroleum ExportingCountries) Secretary General, the GECF (Gas ExportingCountries Forum) Secretary General, and the IEF (InternationalEnergy Forum) Secretary General. The ECO (Economic CooperationOrganization) was also represented and we alsoheard from the Iranian Oil Minister and the Vice President ofIran.The point is that as the G20 countries' main focus was on

Outlookshow they could save their economies from default, by issuingeven more debt. The conference in Iran spoke of innovationin technology and how the energy producing and consumingnations can work together to achieve energy efficiency, stabilityand security. Chris Cook and I presented a simple yet radicalnew market framework, along with a global product set,called 21st Century Resilient Markets, and 21st CenturyEnergy Funding and Finance. It is estimated that the globalmarket in gas alone through to 2035 will need trillions of dollarsin new investments alone.As the G20 meeting has highlighted, dollar economics (debtdriven) are subject to dollar politics. Dollar politics is definedby bank intervention, where we have become totally relianton Wall Street and the City of London for money supply sincethey seem to supply it. As we saw in 2008, it was the bankswho received bailouts, not the people.Dollar politics is practiced through dollar diplomacy, which iswhat the G20 is all about. Through the IMF orthe World Bank more debt is offered to payexisting debt, via the banks of course, inexchange for governments agreeing to austeritymeasures on their countries, which are normallythings like slashing public sector spending,pensions and social security. Each countryis also asked to increase taxes in order to payfor the new debt which is used to pay for theold debt. This is where the Greeks have saidenough is enough. They do not want moredebt. They are instead prepared to default,something which the European Union seemsunprepared for. The credit crisis has invalidateddollar diplomacy. It is simply no longerworking.What we need is a debt equity swap. Ourcurrent economic system is distorted becauseit is overlaid by bank money which is intrinsicallyworthless.The time is right for a move toreality-based economics, by way of swappingdebt based money for intrinsic-based value.The simple solution is to price our currenciesnot against something with no intrinsic valuesuch as debt, but price it against somethingwith intrinsic value such as energy, or morespecifically energy units.An energy unit is an undated credit, redeemable in paymentfor the underlying. This is different to a USD (actually aFederal Reserve Note) because an energy unit is asset-based,whereas a USD is debt-based. If we start with an energy unitin gas, and say that each energy unit in gas is redeemable for5 mmbtu (one million British thermal units) each worth $5,then all of the sudden we have an asset-based currency valuedin energy. To put this in perspective, one btu would heatabout three cups of tea or 500 milliliters of water.Dollar politics and dollar economics will evolve to energyeconomics. Energy economics is neutral, and relies on innovationof production, efficiency ofdistribution and a mechanism forclearing and account. This willdrive us to naturally value energysavings, unlike the current carbontax, which has no intrinsic valueand taxes valueless CO2 emissions.Energy economics is not an alternativeto dollar economics but is acomplimentary or additional economicapproach.Energy diplomacy will be instrumentalin this evolution. The IEF(International Energy Forum) has87 member countries whichaccount for 90% of oil and Gassupply and demand, just onehome for the practice of Energydiplomacy. As long as we keepriding the wave of chaos with theG20, we know what the result islikely to be. Chaos!………………………………*The author, Sam Barden is foundingPartner of SBI Markets DMCC, a Dubairegisteredcommodities trading andadvisory company. Barden has workedin the global financial markets for morethan 17 years in Europe, Russia and theMiddle East.ECO CHRONICLE41

It was a pleasure to meet SOCARhigh officials that I used to meetduring my career in Iran petroleumindustry prior to my retirementat the recent GasInfrastructure Conference in Baku. I wasmember of many negotiating team fordeveloping Islamic Republic of Iran andRepublic of Azerbaijan energy cooperation.I thought I might share with ECOChronicle readers some thoughts on thebasis of my long experience working forIran petroleum industry and EconomicCooperation Organization (ECO)Secretariat in the Caspian region. Thekey question under discussion at theBaku conference was this:Is Politicization of Pipeline TransitRoutes a threat to development ofCaspian energy resources?Gas Consumer Perspective- the view from the EUAmbassador Roland Kobia, Head ofDelegation of the European Union inBaku made clear the view from Brusselswork led to an agreement being signedbetween EU and Ministry of Petroleumin Iran for the opening of the EU-IranCenter for Energy Cooperation.Iran honoured its part of the agreementand duly opened the Center at theInstitute of International Energy Studies(IIES) in Tehran. Unfortunately the EUfailed to honor their commitment tofinance the engagement of an internationalconsultant for the relevant studies.Ambassador Kobia was unaware of theexistence of this agreement.Gas Supply Perspective -the view from the CaspianCompanies interested in exporting gasAzerbaijan to join Nabucco. The fact is -and I am old enough to remember! -that the original purpose of Nabucco wasto export Iran gas to EU. The economicand environmental case for Iranian gaswas as strong then as it is now, and itsaddens me that politics have evisceratedthe original proposal.I have no doubt that due to currentEuro zone crisis and EU economic troublesall other options for Caspian gasexport to the west such as a TransAdriatic Pipeline (TAP); or the Italy,Turkey, Greece Interconnection (ITGI)are also in difficulties through lack of gasto fill them. It was also interesting thatthe SOCAR president when talking tojournalists at the conference said thatAzerbaijan would also be able to exportgas to Syria once the transit talks withTurkey have been completed (the AzeriTimes reported on 23 September 2011 -page 5). Many observers considered thatthe recent agreement between Iran, Iraqand Syria for construction of the IslamicGas Pipeline to the West via theMediterranean Sea would provide anIs Politicization ofA Threat to Development ofECO CHRONICLE42of the opportunity."EU is practically ready to build TransCaspian Pipeline (TCP) for Turkmenistangas supply to Europe; this is the firsttime that EU has concluded a treatyfor all 27 member states of the EU."The organizers, whom I commendfor the fine conference, had printed amessage of "use your brain" on theirbrochures that encouraged me to talkto Ambassador Kobia over the teainterval, reminding him that in 2000his colleague Faouzi Bensarsa's hardproduced in the second stage of developmentof the Shah Deniz field have notyet submitted their final bids. Mr. RovingAbdullayev, president of SOCAR told theconference that Azerbaijan is consideringall the option routes for gas supply to EU.While he did not mention Iranian supplyand rout to EU, I think that it is self evidentand well understood by all, that theIran option is superior in economic andenvironmental terms.One of the othermessages delivered in the conferencewas the invitation extended toalternative route for Turkmen and Azerigas to end users.So, the messages delivered in the conferencefrom both ends of the pipelineomitted Iran entirely, which could onlybe on purely political grounds. But therewere other perspectives:Gas Transit Perspective -the view from TurkeyDr. Reha Aykul Muratoglu Head ofDepartment for Transit Petroleum

OutlooksPipelines Ministry of Energy and NaturalResources of Turkey said:"In view of the increasing demand forenergy, the supply disruptions and therecent global financial downturn, allcountries are in need of considering theirpolicies for enhancing energy security.Access to and reliability of energy transitis becoming ever more important withthe increase in energy trade and thegrowing integration of energy markets."Dr Muraglotu recognized that energysecurity increasingly outweighs otherpolitical considerations and that this factis crucial to the need for integrated energymarket infrastructure, both physicaland financial.Financial Perspective -theView from the UnitedKingdom (UK)The UK has in recent years been at theforefront of energy market development,and so I was fascinated to hear AngusMiller, Caspian Energy Adviser to UKForeign & Commonwealth Office, say:new idea related to Caspian Sea MasterPartnership which is developed during aperiod of more than ten years of studyand observing the issues andproblems of the Caspian SeaEnergy resources developmentand transportationto end users . Theidea as defined andexplained by amember of researchteam studying Global Gas Market andPricing at University College of London,supports the concept of a Caspian SeaMaster Partnership as an apolitical frameworkfor the development of Caspian/ECO resources and the financing andfunding of the necessary infrastructureconnecting Caspian /ECOresources to the EU and theemerging global market...............................................*The author held the positionof the Director for Energy,Minerals and Environment atthe Secretariat of theEconomic CooperationOrganization (ECO)during 1996- 2000.By: Mahmood Khaghani*PipelineTransit RoutesCaspian Energy Resources?"Pipeline transit route politicization willremain another long term potentialthreat to development. Here, I thinkmarket forces, not politics, should createthe balance and reality within the states."In my personal capacity as an Iraniancitizen I intervened to suggest that heclearly meant that the oil and gas industryshould be de-politicized. In supportof de-politicization I prepared, andattached for conference delegates, theoutline proposal for a Caspian MasterPartnership in a PowerPoint in which theH.E. Maroofi, ECO SecretaryGeneral, believes ECO region withits vast population can play a majorrole for dialogue between oil andgas producers and consumers.In fact many Energy EconomicsExperts are of the view that for thesake of resolving current globaleconomic crisis oil, gas and energyindustry in general must bedepoliticized.ECO CHRONICLE43

It is a sad fact oflife that what ischeap is too oftenwasted. As one ofthe most important oiland gas producers inthe world Iran's peoplenaturally expect cheapenergy as of right. Butwith oil prices over$100 per barrel thewasteful use of such avaluable resource is aluxury Iran cannotafford. To raise energyprices without compensationwould beunfair, but to pay acompensating subsidyin Rials or even dollarsruns the risk of inflation. But what else could be done?ECO Unit, a Flight to SimplicityAn ECO Unit is so simple that it can be difficult tounderstand for anyone accustomed to the complexitiesof the Western financial system.Anyone, as individuals or collectively, may issueBy Chris CookECOEnergyStandardUnitA Flight toSimplicityundated credits (IOU)and Iran's energy producersare no exception.I propose thatIran's energy producersco-operate to createpools of energyproduction fromwhich they will issueenergy Units whichmay be used by consumersto pay forenergy.Iran may thenincrease prices ofelectricity and carbonfuel (such as naturalgas and gasoline) toglobal levels. Priceswould be set by creatingand publishing abenchmark energy price probably at a strategicCaspian energy hub location. In 2001 I proposed suchan international price benchmark for oil when I originatedthe concept that became known as the Iran OilBourse.The innovation I propose is that Iranians will not becompensated for increased energy prices either in dol-ECO CHRONICLE44

Outlookslars or Rials which are subject to inflation, but rather inenergy Units. Every Iranian could then have - as long asthey live - a fair and inalienable proportional 'JusticeShare' allocation of energy Units.ECO - Energy Standard UnitThis entitlement of valuable ECO (Energy Convertible)Units could be used to payfor energy of all types. AnECO Unit is the energyequivalent of 10 Kilo WattHours of electricity: otherforms of energy, such as carbonfuels (e.g. natural gas orgasoline) or even heat (e.g.geothermal hot water), arenot ECOs, but will be pricedagainst the ECO.ECO Units will be valuableglobally in exchange,because Iran will acceptthem in payment for energysupplied domestically, regionallyand internationally.Holders of ECO Units willunderstand that it now makes sense to conserve energy,because Units are not only valuable in exchangebut will maintain value in an uncertain world. WhileECO Units may be spent or exchanged for other value,part of the proceeds from increased energy pricescould be allocated for 'energy loans' as public and privateinvestment Energy loans made in ECOUnits are repayable not in Rials or dollarsbut in energy, as borrowers buy back ECOUnits at the energy market price out ofenergy savings.Such investments would be in renewableenergy projects andwith a carbon fuel price set at a level reflecting its truevalue, then to invest in renewable energy and energysavings is literally to obtain free money.TransitionIt has been said that if you wish to keep a cowhealthy you do not regulate what comes out of thecow: you regulate what goesin. So, rather than participatein the trading of intrinsicallyworthless carbon dioxidecredits, Iran could leaddevelopment of a systembased upon the intrinsicenergy value ofcarbon.Instead of pricingenergy in dollars Iran mayprice dollars in energy. Byadopting the ECO energystandard Iran may lead aglobal financial revolutionbased firmly upon the valueswhich underpin Iran's culturaland religious heritage............................................................................*The author, Chris Cook is a former director of theInternational Petroleum Exchange. He is now a strategic marketconsultant, entrepreneur and commentator.in energy savings,such as a new generationof energy efficienttransport; energy efficient buildingswhich are well insulated fromheat and cold; and energy efficientcity and town planning through betteruse of space.Such energy investmentsare not currently economic in Iranbecause valuable carbon fuel is pricedtoo cheaply, but in an ECO economy,ECO CHRONICLE45

By: Mohammad Valipour Pasha*The Global Financial Crisisand its PotentialImpacts on Iran'sEconomyIntroductionThe Global Financial Crisis is ponderedby many economists to be the worstfinancial crisis since the Great Depressionof the 1930s which led to the bailout ofbanks by national governments, the collapseof large financial institutions, anddownturns in stock markets in the globe.The story of the financial crisis was initiatedthrough a vague interaction offinancial assets and a significant issue e.g.liquidity in the US banking system in2008. This financial catastrophe was initiallytriggered by the US housing bubblepeaking in 2007 and resulted in a plummetof real estate pricing that took placewith universal damaging of the financialinstitutions.The Crisis camealong with thereductions inconsumerwelfaretogether with a deep local depressingrecession in economic activities which-aspredicted by financial experts- will leadto a severe global economic recession in2012. The housing markets have stronglybeen influenced causing a lot of job dismissalsand foreclosures in many countriesaround the globe.AnalysisThere seems to be numerous reasonssuggested for the financial crisis.However, the Levin-Coburn Reportissued by the United States Senate states:"the crisis was not a natural disaster, butthe result of high risk, complex financialproducts; undisclosed conflicts of interest;and the failure of regulators, thecredit rating agencies, and the marketitself to rein in the excesses of WallStreet.".According to the critics' arguments,major bugs occurred in pricingthe risk of housing mortgage and therelated assets by the credit rating institutionsand investors. Financial marketsand punctual regulations have not beencarefully adjusted by the central statesduring recent years.1. Macroeconomic EffectsAs credit tightened and internationaltrade declined, Economies haveslowed globally since 2008 wherethe central banks andGovernmentsECO CHRONICLE46

Outlooksreacted with fiscal and monetary policies.Interpretations signify that Iran's economywill also be affected by the worldfinancial crisis albeit the degree of theconsequences may vary. Having beeninfluenced by the global crisis, the oilprice will dip which may result in diminishingoil revenues and that has a majorimpact on the economy.On the onehand, the outcome will probably be overthe non-oil exports as a result of reducingnon-oil export revenues. The effect willcontinue to be on the balance of currentaccount where the exports minusimports are included andexpected to be distorted.In addition, the net entry orexit of capital- comprising thecapital account - is influencedby two factors: First, by the foreignliabilities of Iran's economyand second, inability to absorbforeign investment.It is believed that the phenomenonmay limit currencyentry amounts to Iran whichmeans a remarkable reductionin government revenue of sellingoil currency.The demand and supply sidesof the currency will be influencedto unstable the exchangerate. According to macroeconomicDD-SS analysis, thedemand and supply side of thewhole economy is shockedleading to price disequilibriumand that is the beginning of thefluctuations in macroeconomic variablessuch as inflation, employment and economicgrowth.On the other hand, thedemand for energy will be decreasingwhich may lead to a graduate decreasein oil market price. Provided that it willaffect the real economy of Iran throughoil revenue, the production by the manufacturingestablishments and firms willdrop dramatically.2. Oil Revenues ImpactsAs formerly mentioned the main channelthrough which the Iranian economyis mostly affected is by the oil revenuewhich is a significant challenge - the fallin global oil prices and subsequent fall inoil export revenues.As time is beingpassed through the end of the year(2011), the magnitude of this impact hascombatively been modest, due to exceptionallyand relatively high oil prices andrevenues. However, the recent year'sbudget has demonstrated major fiscalcontraction. The contraction looks evenlarger in the final version of the statement,which does not include revenuesfrom an increase in domestic energyprices proposed by the Government.With reference to the InternationalMonetary Fund October 2011 forecast,Non-oil revenues of the CentralGovernment are expected to decreasefrom 12.1 percent of the non-oil GDP in2011 to 11.9 percent the non-oil GDP in2012. General Government TotalRevenues are forecast to fall from 26.7percent of GDP in 2011 to 24.2 percentof the GDP in 2012, showing signs of anexpected slow-down in economic activity.As for the General GovernmentExpenditures, they are predicted to fallfrom 24.3 percent of GDP in the currentyear 2011 to 23.2 percentage points ofGDP in 2012.3. Financial Market OutcomeBanking system, stock market and thewhole financial market of Iran seems notto be very much influenced by the crisisdue to the closed economy which is notrobustly in connection with the globaleconomy and major stock markets in theworld.Therefore, they would not be directlyaffected because there is no Iranian bankplaying as a shareholder role of the globalbankrupt financial and banking institutionsand vice-versa.Some probable indirect outcomeswould be the share price of nonoilexporting products and their influenceon the price of other shares and it mightresult in a significant decrease instock market Index which is dangerousbecause it will lead to capitalexit from the stock market tothe replacing markets such asgold, currency and housing.Concluding RemarksTo sum up, it seems that thenegative impact of the crisis wouldto some extent be less for us thanfor the other countries. The reasonfor this is that our relation withworld is mainly by oil sales on theone hand that its price has notreached a critical point, and onthe other hand by imports thatpresent situation works in supportof Iran. However, it is quite obviousthat the global recession influencesall the sectors in the economyand each will be sufferedaccording to its share.As this crisisis almost completely not comparablewith the previous economic crises in theworld, the present management has notexperienced it so far. Therefore, it isquite necessary to take effective andthoughtful actions to pass the crisis sothat there are still plenty of unknownaspects of it.…..................................................* The author, Mohammad Valipour Pasha agraduate of Tehran University in "Economicsand International Marketing" is a Senior Expertwho has worked on Future Market Forecastsince 2000.ECO CHRONICLE47