Economy of Resistance

Economy of resistance is not limited to reaching self-sufficiency, reducing dependence on oil revenues and alike. Even boosting productivity and hitting high levels of efficiency in national economy do not necessarily translate into economic security. Self-sufficiency entails reducing dependence on imported inputs. This is the price the country has to pay to provide for economic security. In the meantime, self-sufficiency may be able to provide for partial economic security, however, the situation will be different in the long run. Reducing dependence on oil revenue, to some extent, can help economic security to be achieved. Realizing this requires the government to strengthen strategic and fundamental industries such as steel, copper and cement which, in turn, can help to shape a self-sufficient economy resistive against internal and external shocks.
Economy of resistance serves as an overall strategic plan for the new administration by which production and consumption patterns of the country can be reviewed in order to boost employment and production at the same time.
Generating wealth for the country out of mining activities is solely subject to exploring and discovering new mines and completing earlier discoveries. Thus, mining plays a decisive role in the economic growth. Economic policy-making system in every country is decided based on its capacities, potential and actual advantages. Iran currently enjoys 60 billion tons of known mineral reserves while a large part of potential areas remain unexploited due to geological limitations, lack of exploration and engineering equipment and meager knowledge and studies on the actual size of reserves. The shallow exploration of mineral resources so far makes it necessary to review the process and take certain measures to improve production and productivity in mining sector. To this end, the following measures are proposed:
Planning for development and recruitment of skilled human resource as the most important national social capital
Focusing on entrepreneurship development; and
Employing various available capacities
Economy of resistance is not specifically designed for Iran but currently it can serve the current needs of the country. Iran is unique in terms of mineral reserves in the Middle East. According to the latest statistics, its proven reserves are estimated to worth around $770 billion. Despite rough estimations on the actual mineral reserves in Iran, mainly due to lack of strong exploration facilities, it is still believed that 3% of world's proven mineral reserves are located in Iran.
The concept of economy of resistance revolves around the nation not the government. It relies on nation's determination and capital.
In the past nine years (2005-2013), mining sector and mineral industry have not been privatized as expected and the government has continued ownership through irrelevant quasi-governmental companies leading to significant fall in total and average ROI in upstream mineral industries which is considered to be the lowest among other groups with a meaningful difference (Statistics provided by Parliament Research Center). It seems there is a structural barrier to privatize mining sector demanding further examination. The real private sector has certain potential but the government's determination in this respect needs to be reviewed. Restoring the mining sector to its original footing requires serious research and studies on the privatization process in this sector.
The main policies, strategies and plans that the government need to pursue in order to realize Article 44 of the Constitution and economy of resistance are as follows:
Reforming public companies in order to devolve them to the private sector;
Boosting mines and mineral industries' competitiveness in local and international markets;
Fostering transparency in economic information flow (modifying and completing mines and mineral industries statistics);
Increasing Iran's share in mineral and metal production and export;
Empowering the private sector with a focus on fostering a sound competitive structure free from extremism;
Balancing investment in mining and mineral industries that are intertwined technically and economically;
Making investment in other countries in order to export raw materials in particular bauxite and coal;
Employing private sector's facilities as well as modern shipping methods;






Upgrading production techniques especially in aluminum industry in order to reduce energy consumption;
Employing less water-intensive technologies given the prevailing water scarcity in the country.
The road to developing economy of resistance passes through solving economic issues which in turn strengthens the pillars of economy. In this respect, it is vital to meet the major requirements namely lending support to domestic production and investors.
Based on the statistics released by relevant authorities and Central Bank of Iran, the pace of negative growth in mining and mineral industries' added value has slowed down in 2013 in comparison to previous year. Although various factors including sanctions, mismanagement, liquidity shortage to boost production and finally recession fed the negative growth, recession is considered to be the main economic malaise of Iran in the period from the end of previous administration to the assumption of office by the new team. Thus, government's export-oriented support for domestic production is vital to the development of economy of resistance.
Undoubtedly, economic boom is achieved through optimal use of resources, opportunities and existing capacities and is subject to the application of principles of meritocracy while selecting the senior management. A large share of productive capitals and assets in the country are organized in the form of quasi-private companies, the managers of which are only accountable to their superiors not the shareholders and owners. Such companies are prone to lose contact with the principles of meritocracy giving way to nepotism and favoritism. Economy of resistance is unattainable unless the management models are reviewed and reformed. Moreover, equal attention must be divided among all the social, economic and ecological aspects in order to realize sustainable development through mining and mineral-related activities in mineral-rich developing countries. Neglecting any of the above aspects will not only result in backwardness of economy but also hinders sustainable development. In developed countries, the proper use of minerals and the ensuing revenue generated contribute both to human and economic development and creates new sources of income for the government, for instance, through taxation. Unfortunately, although Iran is among the mineral-rich countries and enjoys unrivaled reserves of oil and gas with over 100 years of experience in exploiting oil, metals and non-metals, her mining sector remains underdeveloped with zero contribution to the country's sustainable development.
Extraction has remained below the standard despite the significant size of the known reserves. Regrettably enough, mineral-rich regions are still categorized under less developed or underdeveloped parts of the country. Proper economic, social and ecological planning in the area of mining, regular supervision of various aspects and setting strong regulations can boost equal development of economy, ecology and society. To this end, all ecological and social policies of mineral communities and those of mining, from exploration to exploitation, should be converged. Minimizing potential damages to the natural resources, it would be useful to extend technical supervision to the work of miners, carry out environment-friendly plans, revive mineral-rich regions via exploitation and provide relevant training to various partners and concerned organizations. Traditional approaches towards mining and minerals should change and effective investments in this sector should drive the industry into the world markets. Efforts should also be intensified if the country seeks to rank first in the region in terms of mining and minerals.
Unlike medium and large-size mines, unfortunately, the small mines accounting for 40% of the total suffer from lack of advanced exploitation technologies. The followings are part of the reasons why small-size mines are still exploited using traditional methods:
Lack of incentives
Ignorance on difficulties involved in mining activities
Outdated equipment
Non-technical supervision
Lack of relevant experience among the stakeholders
Cumbersome regulations
Absence of mining associations
Problems posed by non-mining organizations
Lack of interest on the part of skilled workforce to work in the sector