Overview: Iran Analysis Weekly Report April 10, 2016
11 Apr., 2016
Iran’s economy is expected to grow in the new Persian year 1395 (March 2016 – March 2017), as the lifting of devastating international sanctions helps to counter weak oil prices, which could make it difficult for the country to ramp up crude production.
Iran’s economy expanded 0.7% in the first nine months of the Iranian calendar year ending March 19, as growth in manufacturing outweighed declines in the industrial and services sectors, Tehran’s Statistical Centre announced last week.
Iran’s Central Bank announced the average inflation rate in the country’s urban areas in the 12th month of the Iranian calendar year (Feb. 20 – March 20) fell by 0.5 percent compared to the preceding month, standing at 11.9 percent. The also CBI reported that the Producer Price Index in the period increased 4.9% compared with last year’s corresponding period. The index registered a year-on-year increase of 3.5% compared with the similar month of last year. PPI (using 2011 as the base year) stood at 215.8 in Esfand, indicating a 0.6% rise compared with the previous month.
In the fiscal year ending March 19, 2016 Iran enjoyed a historic positive non-oil trade balance since the 1979 Islamic Revolution as the figure stood at $916 million. The country exported $42.41 billion in non-oil goods and imported $41.49 billion. The share of gas condensates harshly dropped in Iran’s non-oil exports in the past year – by 52.42 percent, affecting the total level of exports.
The Statistical Centre of Iran released the unemployment rate of the country in the previous Iranian Calendar Year (2015/16). According to the SCI, the unemployment rate of the country has been 11%, 0.4% higher than the previous year.
On the political note, Supreme Leader Ayatollah Ali Khamenei urged President Hassan Rouhani to implement the Resistance Economy doctrine more aggressively during his annual Persian new year message on March 20. Iran’s Supreme Leader designated this Iranian year as the year of the “Resistance Economy, Action and Implementation.”
Regime hardliners have criticized President Rouhani and his economic team for appearing to prioritize developing external ties with foreign countries instead of promoting economic self-sufficiency.
President Rouhani and his supporters reaffirmed the administration’s commitment to implementing the Resistance Economy in response to Mr. Khamenei’s speech. Rouhani noted during remarks on March 22 that “one important part of the Resistance Economy that is worth emphasizing is constructive interaction with the world.” Rouhani’s language highlights the disagreement between Ayatollah Khamenei and Rouhani regarding the extent to which Iran’s economy should be integrated into the world economy.
President Hassan Rouhani emphasized the importance of a plan he labelled “JCPOA 2” to boost the Iranian economy during remarks on March 20. He added that his goal for the upcoming Iranian year is to reduce unemployment and reach a five-percent growth rate.
In response to hard-liners’ attack on the administration’s policies, President Hassan Rouhani discussed Iran’s role in the world during his speech marking National Nuclear Technology Day. Rouhani called the nuclear deal “an opportunity for the Iranian nation in the field of technology, investment, and the Resistance Economy, and to create engagement with the world and bring unity inside the country.” Rouhani censured the continuing criticism of the nuclear deal from regime hardliners, stating “this chance does not last forever; if a small group is successful and does not allow us to utilize this opportunity well, this opportunity will not return.”
IRGC Commander Major General Mohammad Ali Jafari downplayed the achievements of the nuclear agreement during a meeting with IRGC commanders. He said “Individuals who speak about a series of JCPOAs are unknowingly moving down a counter-revolutionary path.” Jafari denounced taking the Joint Comprehensive Plan of Action (JCPOA) as a “model” for solving “other issues” in Iran, directly challenging President Rouhani’s Norouz message.
On the international note, Tehran’s long-range ballistic missile launch last month — and reported attempts to soon launch a satellite with its new Simorgh missile — triggered new unilateral sanctions from the United States and widespread condemnation from other world leaders.
Iranian leaders, in turn, have been uniformly defiant about the missile program, with Supreme Leader Ayatollah Khamenei, Islamic Revolutionary Guard Corps Commander Mohammad Ali Jafari, and even President Hassan Rouhani and Foreign Minister Javad Zarif all issuing statements enthusiastically supporting the program.
Table of Contents
Notes
Overview
News Highlights
Economic Affairs
Macro-economy
Inflation Rate in Iran Falls to 11.9%
Customs Administration’s Trade Report in 1394
Unemployment Rate Rises to 11%
Outlook for the 1395 Fiscal Year According to CBI Governor
Tax Reform, a Necessity for Economic Growth and more Transparency in Iran
Why Didn’t the Dollar Depreciate after the Sanctions Relief?
Macro-economic Data
Oil and Gas
Weekly Review
Iran Fights for Market Share
Trade and Agreements
Iran’s Trade Impact in Post-Sanctions Era
Domestic Affairs
Political Tensions Accelerate in the New Year
Norouz Messages
Rouhani’s Hard Task
Rouhani’s Elections Victory
Confrontation?
Key Political and Economic Calendar
Expected Future Events
International Affairs
Reactions to Iran’s Recent Missile Launch
Iran Accuses Americans Sabotaging Reconnecting to International Banking System
Laws, Regulations and Policy Updates
Sanctions
The U.S. to Sort Out Financial Sanctions Regulations on Iran
Financial Markets
Tehran Stock Exchange
Tehran Stock Exchange Annual Review
Foreign Exchange Market
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