Imam Ali KhameneiIranLeaders of UmmahMiddle East

The necessity of having an economy independent from the oil industry

"Instead of us being in the hands of oil, oil should be in our hands. We should reach a point where we can close our oil wells whenever we want." Imam Khamenei

Our economy’s dependence on oil: our problem remaining from the period of the tyrannical gov’t

Security is important throughout different areas of the country. Because, in the present time, one of the fundamental matters of the country surrounds the people’s livelihood, I would like to point out that the economy needs security as well. The economic structure of the country should be built on a solid foundation. Our problem – our historical problem, one that has lingered from the tyrannical era [of Pahlavis] – is the dependence of our economy on oil. This dependency has caused us to be highly concerned regarding security in the area of economic matters.

We are always concerned about the price of oil, the forbidden sale of oil under certain circumstances, the problems arising when exporting it and certain customers’ refusal to give us our money. When every economic dimension revolves around oil, then the economy becomes insecure. The economy should become secure. I said this here because, despite the fact that the military environment is not an environment for economic matters, the significance of security should become evident in all areas. –This holds true even for economic matters which are not apparently relevant to soldiers and the Armed Forces. Oct 25, 2017

The sanctions on selling oil are a short-term problem; the long-term advantage is no more reliance on oil

An important point is that sanctions – primarily the ones on selling oil – and their maximum pressures, which are focused on the issue of oil, are undoubtedly a problem for the country. However, it is a short-term problem. A long-term profit can be obtained from this short-term problem and that is getting detached from oil. A few days ago, government officials announced that we are going to eliminate oil revenues from the budget from a specific date – they have set a specific date for this. Well, this is very good news. This is a great achievement!

If we keep selling our oil and receiving dollars in return, we will never think of separating the country’s budget, expenditures and costs from oil revenues. We would never think of this. When selling oil is prevented, when this easy source of income is taken from the government, then we will think of doing something important. Oct 2, 2019

We need to stop drinking oil

Another issue is about economic progress and solving the people’s problems. One of their purposes of imposing sanctions is to separate the people from the Islamic Republic. They want the people to have problems. They want the country to suffer from unemployment, recession and various economic problems. They want us to keep talking while the people have economic problems. They impose sanctions so that these things happen. And when they seemingly lift sanctions, they do so in a way that these problems will not be eliminated.

What should we do in return? Our antidote is that we should do something to make the economy become a strong, resistant and stable economy. This is the same as the economy of resistance which we have spoken about many times. This is another element of power for our country. The currency of a country that has a strong economy is valuable. Its officials are valuable as well and his people are respected. Under such circumstances, no one can impose anything on them. I have said many times that we should gradually separate ourselves from sucking oil and being dependent on it. We should gradually decrease this dependence. Oil policies and the fluctuations in its price are in the hands of others. Oil is ours, but it is in the hands of others. We should be able to make the economy of the country resistant. We should act in a way that it becomes strong. This is another element of power. Jan 8, 2017

Oil revenues: a great trial for the country

One malady is our dependence on oil. The grave flaw of our economy is dependence on oil. We extracted this substance from underground and we sold it in exchange for dollars without creating any value-added for this cash money – it is like cash money. And we used it for daily affairs. This is wrong! The National Development Fund that we established was for the sake of separating ourselves from oil step by step. In the present time, there is a good opportunity to do that. One of the tasks that should really be considered alongside macro planning by our economic officials is this: we should do something to decrease our dependence on oil on a daily basis.May 14, 2019

There are countries which do not produce a single drop of oil, but they searched and found other means. They found better means and this proved to be in their best interests.

Oil is not in our control. It is not in the hands of oil producers, as you can see. This is not only due to sanctions because sanctions are a recent development, but even when there are no sanctions, oil is in the hands of common bullying consumers in the world. Oil is in the control of the US, Europe and their followers. Pricing and other matters are in their control and they hatch different plots and launch various attacks. Therefore, we should resolve this issue in the country. Aug 21, 2019

Sanctions are an opportunity

Sanctions can be an opportunity. Why? Because experience has shown that whenever the revenues of countries benefitting from natural resources such as oil decreases, they think of implementing economic reforms and they become motivated to develop these reforms. They become motivated to liberate themselves from dependence and they adopt appropriate measures. This happens when the revenues from natural resources are reduced. Later on, when those resources return to their prior state and when their financial resources increase again, they forget about continuing those reforms. So, the pressure stemming from a decrease in the revenues of natural resources has this great advantage, not only for us but also for all countries similar to us because it will save them from dependence on this natural resource, from being a one-product country and from this oil-based economy.

One of the main problems of our economy is that it is based and dependent on oil. This is really the truth of the matter. In the present time, extensive research is being conducted both at a governmental level and at a research-based and academic level in order to find ways to manage the country with non-oil revenues. This is a very important and good measure. Mar 21, 2019

No to an oil based economy; Yes to considering human resources

Well, sometimes, there are not active and intellectual minds in the country; therefore, you formulate plans in certain other ways. But, sometimes, there are thousands of young, enthusiastic, and intellectual forces with lofty thoughts, some of whom definitely have management capabilities – this is because lofty ideas are not necessarily equivalent to having management capability – and by considering these forces, you decide to formulate plans for the country. So, this is another way of considering outstanding personalities, and this is a fundamental point: their influence in formulating plans for the country.

Even when it comes to turning the oil-based economy into an independent, knowledge-based and resistant economy, they are influential. If we did not have outstanding, active, diligent, and enthusiastic forces, we would not embark on changing our economy. However, when competent, industrious, and enthusiastic individuals are available for the decision-making section of the country, one, naturally, takes action Oct 17, 2018

One of the fundamental tasks that we should carry out in the area of economic issues and the future of the country is severing our country’s dependence on oil. –This has been repeated, frequently, for years by all competent and intelligent economists. –And this can become a reality. I have always said to officials that we should separate the economy from selling crude oil as much as possible. Nov 3, 2018

We should reach a point where we can close our oil wells whenever we want

the oil-based economy – in other words, overreliance on the sale of crude oil – is one of the fundamental flaws of our economy. I said this 20 years ago, and some of the officials in those days looked at me in a particular way: they smiled and ignored my statement. I said that we should reach a point where we can seal our oil wells whenever we wish, so much so that we will have the power to avoid exporting oil for three months and keep it for ourselves. I wish we could do this: this is possible. This should not be considered as unlikely.

It is said that we might lose our customers and the like, but there are ways around all of this. We should not be a prisoner of oil. Today, we are a prisoner of oil. We are in the clutches of oil, and oil is not in our hands. The production of oil is in our hands, but its price is in the hands of foreigners: the possibility to sell it is in their hands; imposing sanctions on it is in the hands of others. We are, in fact, very much prisoners of oil; however, it is oil that should be our prisoner. Oil should be under our control: this is a definite policy we must follow.

Oil is a national resource; so, of course, it will take many years for it to be exhausted, but it will be exhausted eventually. We have gotten used to extracting oil and selling it without any value added. We should at least work to create value added for it – for both oil and gas. Of course, we have created some value added for gas in petrochemical industries and the like, but oil is just going out of the country: these are our fundamental shortcomings. We should decrease our dependency on oil with each passing day: this is another crucial point. May 23, 2018

Many years ago – perhaps, 20 years ago – I mentioned this among the executive officials of the time. We should act in a way that we can close our oil wells whenever we like. We should act in a way that we will not be afraid of a lack of customers, markets and oil revenues. We should reach this point. So, we should really think about this. There should be a replacement for oil.

You can see in what conditions we are in the area of oil. One signal from powers and vicious elements in the region to each other will make the price of oil drop from 100 to 40 dollars. How long has it taken for the price of oil to go down from 100 dollars to the current price? So, this is not a reliable resource. We cannot make the economic fate and life of the country dependent on such a thing. Oil belongs to us, but it is in others’ hands and moreover, they earn more from it.

A European or another government that imports oil from our country benefits more than us by receiving tax and other things. We are giving our oil and we receive some money for it, but such countries take our oil and receive money from their people. Such governments use it more than we do by selling oil. What loss-making deal this is! Of course, sometimes we have to produce oil and we have no other option, but I do not at all become happy when I hear the figures on increased oil exports and oil production. I always think that we have to find a replacement for oil and if we decide to do so, one of the best replacements is mines.

In the case of mines, we should seriously avoid selling our raw materials. We have valuable mines. There are very valuable building stones in Kerman Province or in the southern part of Khorasan. If all of a sudden, we dig these stones and send them to Italy so that they work on it and gain value added – and after some time, they will export it to our country – one really finds it difficult to accept this. So, this is another issue. In my opinion, the role of the private sector is important on the issue of mines as well. According to the reports that have been sent to me, a number of provinces and governors have announced that they can involve the private sector in the area of mines and in other areas. Aug 27, 2015

Instead of us being in the hands of oil, oil should be in our hands

My dear ones, the dependency of the country on oil also serves as a problem. Oil is a blessing given to us by God, but the fact that our economy is dependent on oil is one of the biggest problems of our country. We should allow in some changes to make oil separate from the economy of the country. It is not oil that should be in control of us, rather it is we who should be in control of our oil. If oil is in control of us, such problems will persist. This is because it is other powers which set the price of oil; they sometimes impose sanctions; sometimes they buy it; and sometimes they say that they should not buy it from a certain country. We should get rid of an oil-based economy. Of course, this is a very difficult task, but it should definitely be pursued in the country. Mar 21, 2018

A resource-centered economy means continually selling our resources and living off of this

It is correct to say that our economy is an oil-based economy. It is a resource-based economy meaning that you sell resources and eat! They are resources anyway. This should change. Our economy should be based on value-added. Even in the area of stones – the precious construction stones that exist in the country – many of them are exported abroad even before they are fully prepared. This is very surprising and some of our ministers have really shown negligence in this regard. Well, these were some points about political matters. Oct 18, 2017

What does it mean to make our economy resilient?

the issue of the economy of the country and making the country resistant in the area of the economy and economic work so that the enemy will not be able to pressure the country and to impose its demands and will on us through this area.

If we are not dependent on oil and if we strengthen our domestic products, then the day when the price of oil goes from a hundred dollars to 20-plus dollars, our bodies will not tremble. If we can improve our domestic products and climb out of recession, we will not frown when the enemy limits and bans the importation of such and such a product. Our domestic economy should be strengthened. Our country is a large country. We have a large and four-season country. We have a country with numerous resources, the most important of which is our manpower. We have talented, competent, young and motivated manpower. We are one of those countries in the world that have the largest number of educated individuals. We are one of those countries that have the largest number of engineers. We are among the first four, five countries in the world in many fields of knowledge. This manpower is not a minor achievement. This is the most important source of progress for a country.

This vast land, these diverse seasons and climates in different parts of the country and the great resources that exist in Iran are all provisions that give us the power to make our country resistant. When you make your economy resistant from the inside, others will seek your favor instead of imposing sanctions on you. When they see that you will not frown at economic pressures and sanctions, that you do not retreat, and that you do not have to accept defeat, then the hell they will impose sanctions because they will understand that such a course of action is of no avail!  Feb 8, 2016

I complained about the dependence of our economy on oil. I brought this issue up in one of my speeches. This issue is related to what I am saying. We should do something to reduce or stop the sale of crude oil gradually. We should bring about value added. Banks can play a role in this regard. They can both play a constructive or destructive role. Mar 21, 2015

When you pin your hopes on foreign powers so that they come and develop your economy and when you develop it by giving in to them, they will not be satisfied easily. When you rely on the outside, you will be faced with the issue of reduction in the price of oil. All of a sudden, arrogant powers and their regional cohorts come to the conclusion that they should halve the price of oil or reduce it even more. You will be faced with such a problem. When we pin our hopes on the outside, this is what will happen. But when you look at the inside, this will not be the case. Mar 21, 2015

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