Iran’s central bank chief replaced

September 24th, 2008 - 11:51 am ICT by IANS  

Tehran, Sep 24 (DPA) The Central Bank of Iran (CBI) chief Tahmasseb Mazaheri has been replaced by his general secretary Mahmoud Bahmani, Iranian Students’ News Agency (ISNA) reported.Mazaheri is the second CBI governor to resign within President Mahmoud Ahmadinejad’s three-year presidential tenure. The first, Ebrahim Sheibani, resigned in August last year over differences with the president in the country’s economic management.

So far the ministers of economy and finance, interior, cooperatives, mines and metals, oil, education, the head of the planning and budget organization, and chief nuclear negotiator Ali Larijani have left Ahmadinejad’s administration, reportedly due to disagreements with the president’s policies.

ISNA carried the official appointment letter by Ahmadinejad to Bahmani and called on him to increase the country’s economic growth and value of the national currency Rial.

The Fars news agency had Saturday reported about the probable replacement of Mazaheri owing to grave differences with Ahmadinejad over economic policies.

Mazaheri initiated last month a three-month currency reform process with the aim of knocking off three zeroes from the national currency (Rial).

Upon his order, the central bank printed new 50 and 100 Rials, replacing the previous 500,000 ($518) and one million Rial ($1,036) bank cheques.

Although the central bank reassured on state television that the new bank cheques could be used as de facto bank notes, severalinstitutions, including banks, have hesitated to accept them, reflecting the government’s dispute with Iran’s Central Bank in the currency reform process.

Owing to an inflation rate of more than 26 percent - in some cases even up to 50 percent - the current banknotes, which range from 500 Rials (about five cents) to 50,000 Rials ($5.18) no longer correspond to the prices and people have had to take a lot of cash with them for even simple shopping. The coins are de facto worthless.

Inflation in Iran has led to widespread criticism of Ahmadinejad, not only by opposition parties but also within his own political camp.

Both sides have often accused him of ignoring experts’ opinions, especially on economic issues, and instead adopting an ideological approach.

Ahmadinejad has so far failed to implement his promised economic reforms toward fairer distribution of national wealth, including the country’s increased oil revenue.

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