Page 17 - IRANRptSep21

Iran set to see growth after three years of recession says World Bank
grow by 3.5% this year, and by 4.1% and 3.8% in 2022 and 2023, respectively, said the IIF, a trade body for the global financial industry.
“The modest recovery may not reduce unemployment significantly, which currently hovers around 20%,” it said.
“The likely outcome for the JCPOA [Joint Comprehensive Plan of Action] negotiations is a return to the 2015 agreement, which would keep many sanctions in place. Such a limited agreement would deter significant investment by Western firms, making a sharp pickup in growth unlikely,” the IIF added.
New, expanded deal
Should the signatories to the original JCPOA manage to agree a comprehensive new nuclear agreement that moves beyond the 2015 terms, Iran would see GDP expand by 4.3% this year and by 5.9% and 5.8% in 2022 and 2023, respectively, the IIF forecast.
Also under this scenario, official reserves could more than double by the end of 2023 from $70bn as of May this year, foreign direct investment would help deliver jobs and Iran would achieve a fiscal surplus by 2023, the organisation said.
US President Joe Biden wants to eventually broaden the nuclear pact to put tighter controls on Iran’s nuclear and ballistic missile programmes and address Tehran’s support for various militant groups in the Middle East. Iran has rejected overtures from the US aimed at securing these objectives.
No deal
If Tehran and the major powers fail to strike any agreement to revive the JCPOA, unemployment in Iran would likely remain in double digits and there would be subued economic growth of 1.8% this year, the IIF concluded.
Iran appears to have lately emerged from a bitter recession that lasted nearly three years.
Iran has endured three years of recession under US sanctions (see table below) but if the forecasting of the January edition of the World Bank’s Global Economic Prospects report proves correct 2021 should bring growth.
The World Bank anticipates Iran recording a GDP expansion this year of 1.5%, followed by 2022 growth of 1.7%. Should Tehran manage to strike a breakthrough deal for the lifting of heavy US sanctions by the incoming Joe Biden administration and should the coronavirus crisis be for the most part overcome in the Islamic Republic in the year ahead, the forecasts would likely be substantially upgraded.
“Growth in the Islamic Republic of Iran is expected to recover as domestic consumption and tourism begin to normalize, and disruptions related to COVID-19 taper. Oil production in MENA [Middle East North Africa region] is expected to rise as global oil demand recovers,” the World Bank wrote in the report edition.
Iran is among countries that has had to dip into its sovereign wealth fund in the past year to mitigate fiscal pressure caused by the effects of the coronavirus pandemic, it added.
17 IRAN Country Report September 2021 www.intellinews.com