Economic implications of lifting sanctions on Iran (Arabic)

Iran and the Permanent Members of the UN Security Council and Germany (P5 1) reached a deal on July 14, 2015 that limits Iranian nuclear activity in return for lifting all international sanctions that were placed on Iran. This issue of the MENA Quarterly...  See More + Iran and the Permanent Members of the UN Security Council and Germany (P5 1) reached a deal on July 14, 2015 that limits Iranian nuclear activity in return for lifting all international sanctions that were placed on Iran. This issue of the MENA Quarterly Economic Brief traces the economic effects of removing sanctions on Iran on the world oil market, on Iran’s trading partners, and on the Iranian economy. The most significant change will be Iran’s return to the oil market. Secondly, once sanctions and restrictions on financial transactions are relaxed, Iran’s trade, which had both declined in absolute terms and shifted away from Europe towards Asia and the Middle East, will expand. Thirdly, the Iranian economy, which was in recession for two years, will receive a major boost from increased oil revenues and lower trade costs. In addition, there are estimates that Iran holds about $107 billion worth of frozen assets overseas, of which an estimated $29 billion will be released immediately after sanctions removal. Finally, foreign direct investment, which had declined by billions of dollars following the tightening of sanctions in 2012, is expected to pick up. With the lifting of sanctions, the government of Iran has the opportunity to put in place a policy framework that will enable the economy to make maximum use of this windfall and put the economy on a path of sustained economic growth.  See Less -

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