Trade and Foreign Exchange Policies in Iran : Reform Agenda, Economic Implications and Impact on the Poor
Iran's economic performance in the last two decades has been very disappointing. This is highlighted by the fact that per capita GDP was 16 percent lower in 1998 than in 1979. However, the most important single reason for this poor performance...
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| Language: | English en_US |
| Published: |
Washington, DC
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2001/11/1620915/trade-foreign-exchange-policies-iran-reform-agenda-economic-implications-impact-poor http://hdl.handle.net/10986/15478 |
| Summary: | Iran's economic performance in the
last two decades has been very disappointing. This is
highlighted by the fact that per capita GDP was 16 percent
lower in 1998 than in 1979. However, the most important
single reason for this poor performance was not any domestic
economic policy, but the long and costly war with Iraq.
Fluctuations in oil prices and the US embargo also adversely
affected the economy. Once the war with Iraq had finished,
economic performance began to improve slowly; in the decede
ending in 1998 per capita GDP growth was positive, although
it averaged only 3 percent per year. Although less important
than the war with Iraq, Iran's domestic economic
policies have not been conducive to rapid economic growth.
Economic performance has been and still is hampered by
administered prices; large, poorly targeted subsidies;
multiple exchange rates (Which remain important, despite
recent progress in reducing disparities among them); trade
restrictions; and state domination of economic activity. All
banks in Iran are sdtate owned, and most large firms are
owned by the state or by the quasi-public religious
foundations. This report describes Iran;s trade and exchange
rate policies, proposes and explains a reform program, and
develops a computable general equilibrium of Iran's
economy to estimate the gains--to the economy as a whole and
to the poor--likely to accrue from various reform options.
The report also recommends a program for sequencing the reforms. |
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