Page 18 - Trends

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Focus: Irancus: Iran

On the Threshold

Reeling from stagnation, inflation and unemployment, the Iranian economy is making
meticulous attempts to revive its old glory and strike amiable relations with its neighbors.

By Gareth Smyth, Tehran

O n December 18, 2017, a visiting $KPDGLQHMDG KDG SXUVXHG UHFNOHVV LQ- a relaxation of United States and Euro-
delegation from the International
ternational policies, including the nu-
pean Union sanctions enabled Iran to
Monetary Fund gave a generally
double its oil and condensate exports to
clear program that had isolated Iran and
upbeat assessment of the Iranian
economy, estimating 4.2 percent GDP sparked international sanctions, damag- nearly 2.7 million barrels a day. Growth
KDV RQO\ MXVW EHJXQ WR EURDGHQ WKH QRQ
ing the Iranian economy. By 2015, Rou-
JURZWK LQ WKH FXUUHQW ÀVFDO \HDU HQGLQJ hani reached an agreement with six world oil sector, says the IMF, which puts non-
in March. Ten days later, protests broke powers that saw Iran limit its nuclear pro- oil growth for the Iranian year 2016-17 at
out in Iran’s north-eastern Iranian city gram in return for an easing of sanctions. only 0.8 percent.
of Mashhad, spreading within days to “This gave Iranians an eagerness and op- Iran’s foreign direct investment (FDI)
many other cities and centered on peo- timism that a new era was beginning for rose from around $4 billion in 2011 to
ple’s anger over price rises, unemploy- them,” said the professor. “But Rouhani is $11.8 billion in 2017, according to gov-
ment and corruption. not succeeding with his message of hope. HUQPHQW ÀJXUHV )UHQFK RLO DQG JDV ÀUP
“It was an explosion,” an Iranian profes- Iranians are starting to think nothing is Total reached a $5-billion agreement in
sor told TRENDS. “The people arrested going to change.” July 2017 to lead a consortium to devel-
were mainly under 25; many were high- RS SKDVH RI WKH 6RXWK 3DUV JDV ÀHOG
school students. For them, the economy Scaling up apparently after receiving assurances it
is not the whole story, but it is the most The IMF believes the Rouhani adminis- would not face US punitive action.
important. All of my family and friends WUDWLRQ KDV PDGH SURJUHVV 7LJKWHU ÀVFDO Attracting the interest of the large en-
WDON DERXW LQÁDWLRQ DQG WKH ODFN RI MREV µ GLVFLSOLQH KDV EURXJKW LQÁDWLRQ GRZQ ergy companies is vital for Iran to exploit
,W KDV EHHQ ÀYH \HDUV VLQFH +DVVDQ from more than 40 percent to approxi- the world’s largest combined hydrocar-
Rouhani was elected president, when he mately 11 percent. Recession in 2013 was bon reserves, 158 billion barrels of oil
argued that his predecessor Mahmoud transformed into growth largely because and 33 trillion cubic meters of gas, both

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18 TRENDS | February 2018 TRENDS | February 2018