Iran's president scoffs at western sanctions

TEHRAN // Iran's president claims his country can create 10 times more wealth from inventions than from oil, rendering western economic sanctions powerless.

The West's oil embargo over Iran's suspect nuclear programme won't stop the Islamic Republic's scientific and technological progress, Mahmoud Ahmadinejad said.

Addressing a group of Iranians in the western city of Hamedan, Mr Ahmadinejad mocked the embargo, saying that Iranian universities would churn out moneymaking innovations. He did not mention any specific technologies.

"Don't buy our oil? To hell with you," Mr Ahmadinejad said on Tuesday. "It's better if you don't buy ... 10 times more money will head to people's pockets through the inventions of our scientists."

Last week, Mr Ahmadinejad said Iran must move away from dependence on oil revenues to overcome the western sanctions that have slowed the economy and disrupted foreign trade. Iran has long depended on oil sales for about 80 per cent of its foreign currency revenue.

Iran's income from oil and gas exports has dropped by 45 per cent as a result of sanctions. The West fears Iran may ultimately be able to develop nuclear weapons, a charge Tehran denies.

Iran's national currency has also lost about 8 per cent of its value in the past two days, hitting a record low against the US dollar and other foreign currencies in street trading. Street traders said on Tuesday it reached 36,200 rials to the dollar. It was 33,500 rials on Sunday.

Iran's national currency lost nearly 40 per cent of its value in 2012 alone. Each US dollar was traded at about 10,000 rials as recently as early 2011. Iranian authorities have accused the West of waging an "economic war".

The country is living under stepped up western sanctions that also include banking restrictions that make it increasingly difficult for Iran's Asian customers to pay for oil deliveries.

The government is preparing an austerity budget for the next Iranian calendar year that begins March 21. It aims to avoid a budget deficit by substantially increasing income taxes to make up for shrinking oil revenues.

Despite economic hardships, Mohammed Ebrahimi, the head of Iran's Aerospace Research Institute, said on Tuesday the country plans to design and manufacture high-tech space suits within the next eight years, state Press TV reported.

Iran has also said it will soon send monkeys into space, as a prelude to sending humans into space. In 2010 it launched a rocket into space carrying a mouse, a turtle and worms.

The US and its allies are concerned that technology from the space programme could also be used to develop long-range missiles that could potentially be armed with nuclear warheads. Iran denies it seeks nuclear weapons and says it wants only energy-producing reactors.