Leader proposes privatizing some assets of key force

DUBAI, United Arab Emirates — Iran’s supreme leader has ordered the Revolutionary Guard to loosen its hold on the economy, the country’s defense minister says, raising the possibility that the paramilitary organization might privatize some of its vast holdings.

The comments this weekend by Defense Minister Gen. Amir Hatami appear to be a trial balloon to test the reaction of the idea, long pushed by Iran’s President Hassan Rouhani, a relative moderate. Protests over the country’s poor economy last month escalated into demonstrations directly challenging the government.

Whether the Guard would agree remains unclear. The organization is estimated to control around a third of the country’s entire economy.

Hatami, the first non-Guardaffiliated military officer to be made defense minister in nearly 25 years, made the comments in an interview published Saturday by the state-run IRAN newspaper. He said Supreme Leader Ayatollah Ali Khamenei ordered both the country’s regular military and the Guard to get out of businesses not directly affiliated to their work.

“Our success depends on market conditions,” the newspaper quoted Hatami as saying.

He did not identify the companies that would be privatized.

The Guard formed out of Iran’s 1979 Islamic Revolution as a force meant to protect its political system, which is overseen by Shiite clerics. It operated parallel to the country’s regular armed forces, growing in prominence and power during the country’s long and ruinous war with Iraq in the 1980s. It runs Iran’s ballistic missile program, as well its own intelligence operations and expeditionary force.

In the aftermath of the 1980s war, authorities allowed the Guard to expand into private enterprise. Today, it runs a massive construction company called Khatam al-Anbia, with 135,000 employees handling civil development, the oil industry and defense issues. Guard firms build roads, man ports and run telecommunications networks.

Iran always has maintained some level of state control over its economy since the 1979 Islamic Revolution. However, the government pushed control even further during years it faced crushing international sanctions over its contested nuclear program, said Adnan Tabatabai, an Iran analyst who is the CEO of the Center for Applied Research in Partnership with the Orient.