Page 13 - bne IntelliNews Country Report: Iran Dec17

3.2 Macro outlook
World Bank cuts 2017 GDP growth forecast for Iran to 4%
The World Bank has cut its 2017 GDP growth projection for Iran by 1.2pp to 4%, noting that limited spare capacity in oil production and difficulty in accessing finance are weighing on the country’s economic expansion.
The revised forecast for Iran, the second largest economy in the Middle East and North Africa region, was given in the June edition of the World Bank’s Global Economic Prospects. The previous expectation of 5.2% was published in the January edition.
The report update also observed that “food price pressures have further contributed to rising inflation in ... the Islamic Republic of Iran, which climbed back to double digits (y/y) in March 2017 (although it is still on a declining trend from an annual rate of about 35% in 2013).”
The World Bank estimated that Iran achieved economic growth of 6.4% in 2016. For 2018 and 2019, the World Bank is now expecting Iranian GDP growth of 4.1% and 4.2%, respectively. Its January report anticipated 4.8% and 4.5%.
Iran's GDP is projected to grow by at least 6.2% in the current Iranian year (spanning March 20, 2017 – March 19, 2018) with inflation to average around 9.8%, Mehr News Agency reported on February 1 citing the Iranian Ministry of Economic Affairs and Finance.
Under Iran's sixth five-year development plan, Iran should aim for average annual economic growth of 8%. The plan stipulates protectionist business policies and identifies the oil, gas and petrochemical industries as the primary drivers of growth.
Alternative growth scenarios to that put forward by the ministry will be advanced by the Statistical Centre of Iran (SCI) and the Central Bank of Iran (CBI) in coming weeks, prior to the two-week Iranian new year holiday period.
The economic ministry is also predicting 15.4% growth in foreign direct investment and local investment in the current Persian year.
13 IRAN Country Report November 2017 www.intellinews.com