Page 11 - IRANRptMay20

3.1​ ​Macroeconomic outlook
Pandemic-afflicted year puts Iran on course for 2020 GDP contraction of 6% says IMF
Iran will this year suffer a GDP contraction of 6% if the​l​atest World Economic Outlook forecasting​​of the International Monetary Fund (IMF), released on April 14, proves correct.
Warning that the “Great Lockdown” brought about around the world by the coronavirus (COVID-19) pandemic would cause the worst recession experienced internationally since the Great Depression of the 1930s, the IMF said Iran was inevitably in for another tough year following last year’s estimated 7.6% decline in economic output, although it added that the country might achieve growth of 3.1% in 2021. Previous forecasting from the World Bank that Iran might at least see a GDP stagnation of 0.0% in 2020 came before the coronavirus health and economic emergency and can thus be thrown in the waste paper basket.
The US sanctions-weary Iranian economy—one of the earliest affected by a COVID-19 outbreak, which is the worst in the Middle East—was also projected by the IMF to endure consumer price inflation of 34.2% and 33.5% this year and next year, respectively. Last year, the rate was an estimated 41.1%.
For Iran’s current account balance across 2019, 2020 and 2021, the IMF gave estimated figures of -0.1%, -4.1% and -3.4% of GDP, respectively.
For Iran’s unemployment rates across 2019, 2020 and 2021, the IMF estimated 13.6%, 16.3% and 16.7% of GDP, respectively.
The IMF said its latest forecasts were highly uncertain and that the risks were that the economic cost of the pandemic for all assessed countries could turn out to be worse than currently envisaged. Recovery would rely on stimulus measures proving effective in forestalling widespread company bankruptcies, limiting job losses and easing financial strains. The WEO modelled three alternative scenarios: a 2020 lockdown lasting 50% longer than it is forecasting; a mild recurrence of the virus in 2021; and a protracted pandemic and longer containment effort in 2020, as well as a recurrence in 2021. In the worst case, the global economy would shrink by around 11% rather than 3% this year, it said.
Gita Gopinath, the IMF’s economic counsellor, said the global economy was suffering a crisis “like no other”.
11​ IRAN Country Report May 2020 www.intellinews.com