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EghtesadOnline: The 4.3% economic growth for Iran confirmed by the International Monetary Fund in its April report is thanks to the allocation of 190 trillion rials ($4.41 billion) in loans to the manufacturing units of the private sector and allocation of 435 trillion rials ($10.11 billion) to development projects.

Mohammad Baqer Nobakht, the head of Plan and Budget Organization, made the announcement on Wednesday, ILNA reported.

Nobakht also doubles as the spokesman for the government of President Hassan Rouhani.

The growth Nobakht was citing refers to non-oil GDP expansion for the last Iranian year (March 2017-18). Taking into account production in the oil sector, the growth stood at 3.7%, Financial Tribune reported.

The services sector, as usual, registered the highest growth rate last year with 6.8%.

Production in the sectors of industry and agriculture grew by 1.6% and 1% respectively.

Iran’s economy emerged from recession in the fiscal 2014-15 with a 3% growth after two years of recession, when the economy contracted 5.8% and 1.9% back to back, according to the Central Bank of Iran.

Growth in 2015-16 has been put at -1.6% by the Central Bank of Iran and 0.9% by SCI.

CBI has put 2016-17 growth at 12.5% while SCI says it was much lower and near 8.3%.

The noteworthy growth experienced in Iran after the removal of international trade restrictions on the economy as a result of the nuclear deal the country signed with world powers in 2015 (implemented in Jan. 2016), owed to a great extent to Iran’s ability to increase its oil sales.

Later, however, as crude output was ramped up and the production capacity neared pre-sanctions levels, growth in the key sector slowed down and gave way to better performance in other economic sectors.

The International Monetary Fund estimated Iran’s real GDP growth at 4.2% in 2017-18, projecting it to be sustained or even rise toward 4.5% over the medium-term, if financial sector reforms take hold.

Also, in its latest “Global Economic Prospects” report released in June, The World Bank put Iran’s economic growth rate at 4.3% in 2017, forecasting a 4.1% growth in both 2018 and 2019 and 4.2% in 2020.

The United Nations has estimated a 5.3% economic growth for Iran in 2017, noting that the growth is projected to settle at 5.1% and 5% over the next two following years respectively.

 

Private Sector economic growth International Monetary Fund Iran Growth Development Budget development projects