SHAH'S REMARKS ON PRICE OF GOLD
1. SUMMARY: PROMPT GOI CLARIFICATION OF SHAH'S STATEMENTS TO
AP REPORTER ON "PRICE OF GOLD" AFFIRMS IRAN IS MORE CONCERNED OVER
ANY INFLATIONARY IMPACT OF A CHANGE RATHER THAN IN PRICE OF
GOLD PER SE. END SUMMARY.
2. GOI PROMPTLY ISSUED CLARIFYING STATEMENT APPEARING IN PRESS
DECEMBER 21, CONCERNING SHAH'S STATEMENTS ON PRICE OF GOLD TO AP
REPORTER HUGH MULLIGAN. AS REPORTED IN INTERNATIONAL HERALD
TRIBUNE (PARIS) ON DECEMBER 20, SHAH REFERRED TO TALKS BETWEEN
PRESIDENTS FORD AND GISCARD D'ESTAING AND INDICATED INCREASE IN
GOLD PRICE WOULD BE A "VERY, VERY GRAVE PROBLEM" AND THAT INCREASE IN OIL PRICES WOULD "SURELY FOLLOW." HE FURTHER INDICATED INCREASE
IN GOLD PRICE COULD END RECENTLY DECIDED NINE-MONTH FREEZE IN PRICE
OF OIL BY OPEC COUNTRIES. MULLIGAN QUOTED SHAH AS SAYING
THAT INFLATIONARY SPIRAL AND LOSS OF IRANIAN PURCHASING POWER
COULD EVENTUALLY LEAD TO COLLAPSE OF THE WORLD MONETARY SYSTEM.
3. CLARIFICATION ISSUED BY IMPERIAL COURT STATED:(BEGIN TEXT)
HIM THE SHANANSHAH, IN THE INTERVIEW GRANTED TO A CORRESPONDENT
OF THE ASSOCIATED PRESS, REFERRED TO RECENT DECISIONS CONCERNING
THE UP-PRICING OF GOLD HELD IN STOCK BY VARIOUS GOVERNMENTS. TO
AVOID ANY POSSIBILITY OF HIS IMPERIAL MAJESTY'S REMARKS BEING
ERRONEOUSLY INTERPRETED OR OTHERWISE MISCONSTRUED, IT SHOULD BE
CLEAR THAT THE SHAHANSHAH SAID: "IF THE UP-PRICING OF GOLD
RESERVES PROVES TO LEAD TO AN EROSIION OF THE REAL PURCHASING
POWER OF OIL EXPORTING NATIONS FROM EXPORTS OF THEIR OIL,
THESE COUNTRIES SHOULD TAKE NECESSZRY STEPS AIMED AT PROTECTING
THEIR REAL PURCHASING POWER." (END TEXT).
4. COMMENT EMBASSY BELIEVES AP REPORTER EITHER INACCURATELY
REPORTED SHAH'S REMARKS OR QUOTED HIS STATEMENTS OUT OF CONTEXT.
IRANIANS DO NOT SEEM TO HAVE STRONG VIEWS ON PRICE OF GOLD
PER SE. MINISTRY OF ECONOMICS AND FINANCE UNDER SECRETARY
FOR ECONOMIC AFFAIRS AHMAD KOOROS TOLD EMBOFF SHAH'S REMARKS,
ALSO QUOTED IN INTERVIEW, ELABORATING ON HIS CALL FOR TALKS
WITH OIL IMPROTING NATIONS ON LINKING THE PRICE OF OIL TO MARKET
BASKET OR OTHER COMMODITIES WERE MOST IMPORTANT PART OF INTERVIEW
AS STATEMENT OF GOI POLICY. CENTRAL BANK OR IRAN DIRECTOR-
GENERAL FOR INTERNATIONAL AFFAIRS SHAHPUR SHIRAZI SAID LIQUIDITY
AND MANAGEMENT OF DOMESTIC POLICIES IN MAJOR WORLD TRADING COUN-
TRIES REMAIN IRAN'S CHIEF CONCERN.
5. IRANIANS CLEARLY ARE APPREHENSIVE OVER CURRENT UNCERTAIN
INTERNATIONAL FINANCIAL SITUATION, AND CHANGES IN STATUS OF GOLD
IS ONLY ONE ASPECT OF THEIR CONCERN. THEIR MAIN GOAL REMAINS
TO DEFEND AS ENERGETICALLY AS POSSIBLE THE PURCHASING POWER OF
THEIR PETRODOLLARS. IF A COUNTRY'S VALUATION OF ITS GOLD RESERVES
AT CURRENT MARKET PRICES DOES NOT HAVE AN INFLATIONARY IMPACT
IN TERMS OF PRICES IRAN MUST PAY FOR ITS IMPORTS, THE GOI WILL
NOT OBJECT. QUICK "CLARIFICATION" OF SHAH'S STATEMENTS INDICATES
GOI'S CONCERN THAT THEY NOT ADD ADDITIONAL CONFUSION TO SITUATION.
HELMS
Source: http://www.wikileaks.org/plusd/cables/1974TEHRAN10780_b.html
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