Rouhani: Iran cannot shut down economy despite worsening coronavirus outbreak

Iran has suffered a sharp economic downturn after US President Donald Trump withdrew from a landmark nuclear agreement in 2018 and reimposed crippling sanctions. (WANA via Reuters)
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Updated 11 July 2020

Rouhani: Iran cannot shut down economy despite worsening coronavirus outbreak

  • Iran must continue ‘economic, social and cultural activities while observing health protocols’
  • The International Monetary Fund predicts Iran’s economy will shrink by six percent this year

TEHRAN: Iran said on Saturday that it cannot afford to shut down its sanctions-hit economy, even as the Middle East’s deadliest coronavirus outbreak worsens with record-high death tolls and rising infections.
Iran must continue “economic, social and cultural activities while observing health protocols,” President Hassan Rouhani said during a televised virus taskforce meeting.
“The simplest solution is to close down all activities, (but) the next day, people would come out to protest the (resulting) chaos, hunger, hardship and pressure,” he added.

However, he called for big gatherings such as weddings and wakes to be banned to stem a rise in coronavirus infections.
Shortly after Rouhani’s televised speech, a police official in Tehran announced the closure of all wedding and mourning venues in the capital until further notice.
The Islamic republic has been struggling since late February to contain the country’s COVID-19 outbreak, which has killed over 12,400 people and infected more than 252,000.
Deaths from the respiratory disease hit 221 on Thursday — a single-day record for Iran.
The country closed schools, canceled public events and banned movement between its 31 provinces in March, but Rouhani’s government progressively lifted restrictions from April to reopen its sanctions-hit economy.
The outbreak’s rising toll has prompted authorities to make wearing masks mandatory in enclosed public spaces and to allow the hardest hit provinces to reimpose restrictive measures.
Iran has suffered a sharp economic downturn after US President Donald Trump withdrew from a landmark nuclear agreement in 2018 and reimposed crippling sanctions.
The International Monetary Fund predicts Iran’s economy will shrink by six percent this year.
“It is not possible to keep businesses and economic activities shut down in the long-term,” Rouhani said, emphasizing that “the people will not accept this.”
Health Minister Said Namaki warned on Wednesday of a potential “revolt over poverty” and blamed US sanctions for the government’s “empty coffers.”
The reopening of the economy “was not over our ignorance (of the virus’ dangers), but it was due to us being on our knees against an economy that could take no more,” Namaki said on state television.
US sanctions targeted vital oil sales and banking relations, among other sectors, forcing Iran to rely on non-oil exports, which have dropped as borders were closed to stem the spread of the virus.


Arabtec Holding said to hire AlixPartners for debt advisory

Updated 25 September 2020

Arabtec Holding said to hire AlixPartners for debt advisory

DUBAI: Dubai-listed contractor Arabtec Holding has hired advisory firm AlixPartners to help it restructure the company’s debt, two sources familiar with the matter said.

AlixPartners is assessing the company’s debt profile, before any potential discussions with Arabtec’s creditors, according to the sources, who declined to be named as the matter is not public.

Arabtec did not respond to a query for comment when contacted on Thursday. AlixPartners declined  to comment.

Arabtec Holding is due to hold a shareholder meeting on Thursday afternoon to decide whether to continue operating or liquidate and dissolve the firm after the pandemic hit projects and led to additional costs.

FASTFACT

 

Arabtec last month posted a first-half loss of 794 million dirhams ($216.18 million).

The company, which last month posted a first-half loss of 794 million dirhams ($216.18 million) and total accumulated losses of 1.46 billion dirhams, said on Sept. 9 that it was calling a general assembly under an article of UAE company law.

The law requires companies to vote on whether they should continue operating if their accumulated losses reach half of their issued share capital.

Shares of Arabtec Holding, which helped to build the Louvre Abu Dhabi and the world’s tallest skyscraper, the Burj Khalifa in Dubai, have plunged 56.7 percent this year. They were down almost 5 percent when a suspension of trading was triggered at 1 p.m. local time ahead of the meeting, which was being held in Abu Dhabi.

Several UAE companies have sought to extend debt maturities or agree better terms in recent years to avoid defaults, after an oil price crash hit energy services and construction.

This week, creditors started to enforce claims against Abu Dhabi-based Al Jaber Group, which has struggled since building up debt in the wake of a UAE real estate crisis and began talks with creditors in 2011.

Dubai-listed construction firm Drake & Scull is working under the UAE bankruptcy law to reach an agreement with its creditors in an out-of-court process.