The Forum for Partners in Iran's Marketplace

January 2018, No. 86


Startups Did What Governments Failed to Do!

Sattari believes that education is a key issue for knowledge-based companies; that is, manpower is the basis of knowledge-based economy, and nothing is more important than its training.

The development of new business practices has drawn the attention of the country’s decision-makers under conditions that this newly emerged spectrum complains about lack of laws that would fit the businesses; they talk about legal hindrances which, according to analysts, have faced the pace of transition from traditional economy to modern economy with serious challenge. However, the emergence of startups in the Iranian economy has received strong backing from the Vice President for Science and Technology Sorena Sattari.

Speaking at a “breakfast session” with members and board of directors of the Iran Chamber, Sattari came up in defense of modern businesses in line with changing the traditional Iranian economy since the coming to power of the 11th government: Changes that, taking into account the development of certain issues, including the “brain drain” have become a matter of concern for the government’s economic authorities.

The issues raised by Sattari, in his second meeting with the private sector parliament (Iran Chamber), can be divided into two distinct parts. The first part was about the “transition from traditional economy” and the second part was devoted to the “educational system”.

In the first part, he said that nowadays startups have transformed urbanization, so that those active in service-related fields have offered high-quality and cost-effective services. Sattari also mentioned examples for these changes, examples which extended to “intra-city transportation” on the one hand, and the “number of judicial cases” on the other hand. According to the vice president, the government could not bring about new changes in the intra-city transit debate, but the initiative of ​​a group of young people brought serious transformation along with high quality and low cost.

In the opinion of Sattari, it is also possible to easily use new technologies in other services too, so that the number of judicial cases, 60% of which is related to the State Punishment Organization, would reach zero. He said for services sector startups, an average has been set according to which, if they fail to experience 10% growth per week, the authorities would realize that there are problems.

In another part of his speech, Sattari pointed out the high potential of Iranians’ genetics in biotechnology and said: “Iranian talent in the field of knowledge and in manufacturing equipment is fully compatible with this knowledge.”

He is convinced that good things have occurred in the field of nanotechnology in the country; last year, adding, sales in the field of nanotechnologies was tripled and reached 9,000 billion rials. Noting that the number of companies is growing, he announced the arrival of firms that would soon be challenging traditional companies. According to Sattari, these firms will change the economic players with their technologies. The VP believes that new ideas will shake up everything, and Iran can revive new players in technological areas where they have been lagging behind for many years. Sattari also emphasized the necessity of forming an appropriate “ecosystem” for the Iranian economy, the one that has no connection with the state but comprises the private sector. He believes that the creation of this ecosystem is conditional: Conditions that require the restructuring of banks’ investment because the government cannot accept risky investments. 

Risky Educational System

The second part of Sattari’s speech focused on the “educational system” of the country. He believes that education is a key issue for knowledge-based companies; that is, manpower is the basis of knowledge-based economy, and nothing is more important than its training. He spoke of his concerns about the fact that there is always a debate about why university and industry do not work together and why there is no connection between education and economy. In his opinion, there should be new ideas in the economic sphere: ideas that seem to be impossible without proper training.

Sattari is of the view that universities which receive one hundred percent of their budget from the government cannot produce a suitable output of work force and training, and therefore will have no efficiency for the market. He believes universities should be set up which would receive about 70% of their budget from the private sector, in the form of contracts for industry, technology and startups. He reiterates that over the past four years, these events have occurred at universities, which have also affected the behavior of students.

The VP for science and technology added: “Education is not something to be limited to high school and university and should continue until death; and the ground for these trainings is the cities. That is why the debate on creative cities is raised.” He said the only thing we offer our children is the employment debate, while we must say that recruitment would destroy them and eliminate their creativity, and that is why we must teach them entrepreneurship. 

Technological Gap

Chairman of Iran Chamber of Commerce, Industry, Mine and Agriculture Gholamhossein Shafei, also addressed the meeting. Referring to the severance of Iran’s relations with global markets over the past decade, he said: “There is a significant technological gap between manufacturers in Iran and other countries, especially in the field of industry. This technological gap has made us keep away from global competition.” He emphasized the necessity of using up-to-date technology in all economic and productive fields and said: “It seems that under the status quo and given our economic failures over the past decade, the only solution to our economic problems especially in the field of production, is a breakthrough in the area of modern knowledge and technology. He also underlined the need to use the up-to-date technology in the field of agriculture and said: “Despite the problems we face in agriculture, especially the water crisis, we still have not been able to use new and modern agricultural methods of irrigation.”

Shafei also emphasized on the issue of green economy and noted: “In the environmental field too, we are faced with numerous problems. Given the concept of green economy development, while addressing the environmental dilemma, we can also pay attention to the economic issues in the environmental field.” Referring to the commissions and organizations active in the chamber in the field of entrepreneurship and new businesses, he said: “Entrepreneurs and economic activists from the chamber are ready to start a new chapter in cooperation with the office of vice president for science and technology and boost their support for knowledge-based companies, particularly at provincial levels.”

Shafei also suggested that a joint committee to be established between these two bodies to pursue relevant matters and issues of mutual interest. In another part of his speech, he emphasized the need to further facilitate the business climate for startups and knowledge-based companies. He also referred to the science and technology parks and the centers of growth, saying these centers are very close to the private sector, but their administration is highly state-sponsored. Shafei emphasized the need to formulate a long term roadmap and said: “I believe we need to map out a roadmap for this sphere and determine the priorities.”


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  January 2018
No. 86