Page 4 - IRANRptJun22

1.0 Executive summary
Iran’s economic growth recorded 5.7% in the third quarter of the current Iranian calendar year (September 23 – December 21, 2021), according to a report by the Central Bank of Iran (CBI) on March 14. Iran’s economy has continued to rebound despite US sanctions still levied on it through local production and a boost in exports thanks to high oil and gas prices in the global market.
The CBI’s report said that the country’s gross domestic product (GDP) stood at $13.4bn in the three-month period, showing 5.7% growth compared to last year’s corresponding period. The report put the country’s overall economic growth in the nine months to December 21, 2021 at 4.1%.
This would mean Iran has emerged from the long and bitter three-year recession that set in around May 2018 following then US president Donald Trump’s reintroduction of heavy sanctions on Tehran. Officials have credited higher exports and a general realignment of the economy, necessitated by the impact of heavy US sanctions, with securing the new growth.
There are indications that Iran and the US are moving towards an acceptance of something towards the “coma option”—or an interim agreement—to break the current deadlock over how to resurrect the 2015 nuclear deal, or JCPOA. Biden’s Iran negotiator told the congressional hearing that ‘nuclear talks aren’t dead, but almost’. An interim deal could still salvage the accord and potentially provide the basis for full compliance by both sides after the US elections this November.
The Vienna talks process aimed at finding a path to restoring the JCPOA has not made any significant progress for more than two months, with issues such as Iran’s demand that the US delist the Islamic Revolutionary Guard Corps (IRGC) from its list of designated foreign terrorist organisations (FTO) not overcome.
Iranian Foreign Minister Hossein Amir-Abdollahian appeared at the World Economic Forum in Davos on May 26 and declared: Either US President Joe Biden ends his predecessor Donald Trump’s “maximum pressure” strategy against Tehran and guarantee Iran economic relief from the lifting of sanctions or the window for diplomacy might close.
Western diplomats familiar with the latest Vienna talks developments were cited in a Reuters analysis on May 2 as saying that their governments were losing hope for an agreement to restart the JCPOA, but were not yet "pulling the plug."
The Iranian rial (IRR) hit a year-to-date free market low versus the USD on May 31. The currency touched IRR312,200 for the first time this year. The impasse in efforts to find a way to revive the 2015 nuclear deal, or JCPOA, which would mean an end to heavy economic sanctions on Iran, has soured market sentiment in recent weeks.
The worsening “street rate” of the dollar and other hard currencies in Iran are a further burden to the consumer faced by painful inflation, officially at around
4 IRAN Country Report June 2022 www.intellinews.com