A Bet on the Future

Ever since tear-spouting Premier Mohammed Mossadegh brought his country close to economic ruin in 1951 by nationalizing its oil industry,* Iran has been trying to import as much foreign money and knowledge as possible. Thanks to the Western-minded Shah, Iranian law now offers solid safeguards to foreign investors. The question, after what happened in neighboring Iraq, is whether the politically discontent will wait for long-range economic benefits. Wall Street is making an impressive bet on Iran's peaceful future.

Last January Lazard Freres & Co. and Chase International Investment Corp. sent a mission to Iran to set up a financial center to provide credits for investors. In southwestern Iran, the government authorized the U.S. Development and Resources Corp. founded by former TVA Chiefs David Lilienthal and Gordon Clapp, to work on plans for a $5 million dam, a 375,000-acre irrigation project, a sugar mill and refinery, Iran's first major electric transmission line, and a gas pipeline from the Agha Jari oilfield.

Last week two more U.S. companies--Ebasco Services Inc., a subsidiary of the engineering and construction firm of Electric Bond and Share Co., and the investment firm of Allen & Co.--announced that they were combining resources and talents in the Kerman Development Corp., to study the possible development of 50,000 promising square miles of Iran's mountainous south central area.

On the basis of this study, the Iranian government hopes to persuade private enterprise to help finance port installations, mining of coal and chrome, and agricultural projects. "A very conservative guess" of the sum involved for the planning: up to $100 million.

*Mossadegh, now in his 80's and living in his home village of Ahmadabad, is banned forever from holding public office.

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