US sanctions to badly affect Iranian economy: Report

By Mehdi Ansari Jovini

TEHRAN

The U.S. withdrawal from a 2015 nuclear deal with Iran and fresh U.S. sanctions are expected to badly affect the Iranian economy, a new report by the Iranian research center said this week.

A report by the Iranian Parliament’s Research Center forecasts that the economy will grow by either 0.5 percent or minus 2.8 percent by the end of March 2019, which marks the end of the current Persian year.

The IMF and World Bank had earlier forecast that the Iranian economy will grow in 2018 by 3.7 and 4.1 percent, respectively.

The Iranian research center forecast that Iran’s oil-free sectors will grow by 1.9 percent and 0.8 percent this year.

The report recommended that the Iranian government should reduce dependence on imports and activate sectors that have stronger links with other economic sectors, with particular emphasis on attention to the housing sector.

In 2013 and 2014 when the sanctions were tightened up on Iran, the Iranian economy grew by minus 6.8 percent and 1.9 percent, respectively.

According to the Iranian Central Bank, Iran's economic growth hit 3.7 percent in the last Persian year that ended in March 2018.

In mid-2015, Iran signed a landmark nuclear deal with the P5+1 group of nations (the five permanent UN Security Council members plus Germany).

The agreement placed tight restrictions on Iran’s nuclear program in exchange for billions of dollars in sanctions relief.

In May of this year, however, U.S. President Donald Trump unilaterally withdrew his country from the agreement in a move heavily criticized by the deal’s European signatories.

Washington then reimposed sanctions on Iran, which primarily target the country’s banking sector.

EU states, for their part, have urged Tehran to remain a party to the agreement, although Iran has yet to respond to these calls.