Baku, Azerbaijan, Dec.27
By Leman Zeynalova – Trend:
After rising again to $430 billion in 2018, Iran’s GDP is predicted to fall back to $334 billion in 2019, Trend reports citing the World Economic League Table 2019 (WELT) of the Centre for Economics and Business Research (Cebr).
The report shows that unemployment in Iran has risen to 12.9 percent and is forecast to reach nearly 15 percent in 2019 while poverty, which had fallen at the beginning of the decade, appears to be rising again.
“The budget deficit has risen from 1.8 percent of GDP in 2017 to a forecast 4.1 percent in 2019. For a country with limited access to capital markets this is likely to prove a difficulty and reports of unpaid government sector wages are rising,” said Cebr.
Future growth depends on the extent to which Iran can evade the impact of sanctions, according to WELT.
“The EU has rejected the enforcement of US based sanctions but given the extent to which the US insists on extraterritorial powers it looks unlikely that these sanctions can be effectively avoided. We therefore expect the contraction of GDP to continue into 2019 and sluggish growth thereafter,” said the report.
Cebr expects average growth rates of 0.7 percent from 2018-2023, 1.9 percent from 2023-2028 and 1.9 percent from 2028-2033.
“This compares with a predicted growth rate in the 2020s of 3.9 percent before the US re-imposed sanctions. Iran will fall from 30th in the 2018 World Economic League Table to 34th by 2023.”
US President Donald Trump declared Washington’s withdrawal from the nuclear deal with Iran in May 2018. Trump also announced the restoration of all sanctions against Iran, including secondary ones against other countries doing business with Iran. The United States re-introduced part of the sanctions against Iran on August 7, while the second batch of the sanctions came into effect on Nov.5.
The US government has agreed to let eight countries, including South Korea and Japan, as well as India, keep buying Iranian oil after it reimposes sanctions on Tehran. The waivers have been granted for six months.
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