Rebooting Iran's Economy

What Tehran Needs to Do to Fix its Finances

A woman speaks with a seller at the grand Bazar in central Tehran October 7, 2015. Raheb Homavandi / Reuters

The deal between Iran and the P5+1 powers could not have come sooner for the Iranian economy, which has been crippled by some of the twenty-first century’s strictest economic sanctions. The United Nations Security Council’s trade embargoes against Tehran caused the state’s oil revenues to shrink daily, and made Iran’s national currency devalue by almost 80 percent. Unemployment and inflation simultaneously soared to unprecedented levels, and the Iranian economy plummeted to pre-sanctions levels. 

Iranian President Hassan Rouhani has managed to jump-start a modest economic recovery in Iran by dismantling some of his predecessor’s ill-advised populist economic policies and adopting a slew of new economic strategies. As a result, the World Bank reports, Iran’s GDP grew by 1.5 percent in 2014, following two years of economic recession. Iran’s oil revenue is essential for the nation’s recovery over the next few years, as its economy depends on

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