Tuesday, 21 July 2009

Bonyads


Bonyad, meaning "Foundation", are tax-exempt charitable trusts in Iran. Quite uniquely, they form a huge part of the Iranian economy, forming around 10-20% to 33-40% of Iran's GDP, $115 billion in 2002 and employing from 400,000 to 5 million people.

Bonyads were initially founded as "royal foundations" by Shah Mohammed Reza Pahlavi, they were consortium that would specialise in certain areas in a charitable context, such as Religious or Cultural institutions, though they would move into other areas such as property development and trade. Originally private, they became nationalised after the 1979 Revolution by Ayatollah Khomeini and taken over by religious leaders or pro-Khomeini supporters. They gradually became more powerful as these foundations expanded into more and more areas, such as agriculture, manufacturing, trade etc. until they formed the huge part of the economy we see today. However, this fits into the centrally planned economy structure, with different economic sectors being able to be controlled by the government through foundations as they are constantly run by religious leaders and former or current government most of whom are appointed by Supreme Leader Ayatollah Khamenei.
Examples of Bonyads include:

Foundation for the Oppressed and Disabled (Bonyad-e-Mostazafen va Janbazan)

Established in 1958 by Shah Mohammed Reza Pahlavi as the "Pahlavi Foundation", which held the assests and interests of the Shah, his predecessors and most of his family, with an estimated value of $3 billion. After the 1979 Revolution, this was changed to the "Foundation for the Oppressed and Disabled". The government took properties it nationalised while those taken by the Revolutionary Courts were made part of the Foundation for the Oppressed and Disabled. The foundation uses the huge profits from these assets to assist 120,000 families of veterans and victims of the 1980-88 Iran-Iraq War and the poor. It now controls 400 companies and factories in Iran, and employs 200,000 people and has a budget of 10% Iranian GDP (around $10 billion)
It controls (among other things):

  • Bonyad Shipping Co. (BOSCO)
With offices all around the world, controls shipping to and from Northern and Southern Europe and Oman and works with ports , the Shipping Organization and Khuzestan Steel Company for transporting Iron ore from Khuzestan, Iran to all around the world. Managing Director is currently Ali Safarili.
  • Azadi and Laleh hotels in Tehran
The biggest hotels in the country. World class as they were originally the Hyatt and Hilton hotels, they were nationalised in 1979 and placed under the foundations control.
  • Zam Zam soft drink company
Zam Zam (formerly Pepsi until it was nationalised in 1979 and turned into an Iranian brand) is the most popular soft drink in Iran and hugely popular in Muslim countries such as Malaysia and Saudi Arabia, where it was nicknamed "the soft drink of the Hajj" following the countries boycott of Coca-Cola. With headquarters in Tehran, the company has 17 production factories across Iran and produces many diverse soft drink products, such as Lemonade, Orangeade, Mango, Mineral Water etc. It's name comes from the Zam Zam Well in Masjid al-Haram in Mecca, which millions of muslims drink from each year during Hajj.
  • Ettele'at and Kayhan newspapers
Both originally pro-Shah newspapers, became nationalised after the 1979 Revolution. Ettele'at (meaning "Information")