The International Monetary Fund (IMF) has slightly cut its growth outlook for the Iranian economy amid projections that the country might continue to struggle with the economic impacts of one the largest outbreaks of the coronavirus pandemic in the Middle East.
Charts and tables published by the IMF related to its World Economic Outlook Update in January showed the global financial body predicts that Iran’s economy will grow by 3% in 2021.
The IMF had predicted in October that Iran’s growth would reach 3.2% this year, after an estimated contraction of 1.5% last year.
Iran’s economy shrank by 6.5% in 2019 when the country began to feel the impacts of lower oil sales because of a series of American sanctions enacted a year before.
However, the IMF raised its forecast for Iran’s growth in 2022 by 0.5 percent, saying the country’s gross domestic product (GDP) will grow by 2% next year.
That comes as some experts estimate that Iran could even show a better GDP performance next year if a current administration in the US decides to ease sanctions on the country by rejoining a 2015 international agreement on Tehran’s nuclear program.
Increased economic activity that might follow an easing of coronavirus-related restrictions in Iran could also help boost the country’s growth in 2022.
IMF forecasts for 2021 means Iran will outperform regional rival Saudi Arabia at 2.6% of GDP growth while trailing Turkey at a growth rate of 3.5%.
However, the IMF data and forecasts, presented on the basis of Iran’s fiscal year to late March, showed that the country would continue to grapple with high levels of inflation in 2021 with a projected increase of 30% in its consumer price index.