that Iran would enjoy zero growth this year, but a leading economist says the IMF is just using Iran’s statistics and not endorsing them.
The IMF several weeks ago issued a statistical compilation called World Economic Outlook in which it projected Iran’s economic growth this year at 0.0 percent, the fifth lowest in the world.
Iran complained bitterly that it had given no such number to the IMF and commented that in the past the IMF has just inserted blanks when a country did not produce projections. Iran was correct. But this year, the IMF decided to publish its own projections instead of inserting a blank.
Earlier this month, an IMF team visited Iran. After the visit, it issued a two-page statement that was generally laudatory. It said, “Real GDP [gross domestic product] growth recovered to an estimated 3.5 percent in 2009-10 despite the drop in oil prices, reflecting strong non-oil growth and an exceptional agricultural crop. The positive growth continued in 2010-11.”
That was a complete rewrite of what the IMF said in April. Iran has not issued GDP figures in recent years so the IMF used its own figures: 1.0 percent growth in 2008, 0.1 percent in 2009, 1.0 percent in 2010 and a projected 0.0 percent for 2011.
Why the change? Iran said the IMF was “correcting” errors it made in April.
But Jahangir Amuzegar, a Washington-based economic consultant who was Iran’s minister of finance and of commerce in the 1960s and served on the IMF Executive Board for many years, says the new IMF statement is not a correction, just a reflection of the fact that the IMF uses whatever numbers its member states give it.
“IMF receives all its information and economic data from the countries themselves,” he told the Iran Times. “They cannot go to a country and make an independent survey of inflation, growth, etc. They must and do rely on the host country’s words. All they can do is ask questions and demand explanations. They never quarrel with the host country and cannot issue a press release if the host country objects—as China did recently.”
A number of other economists were highly critical of the IMF statement issued last week.
For example, Mehrdad Emadi with the London-based Data Matrix Systems told Radio Farda he objected to the IMF statement that Iran had brought inflation down from 25.4 percent in 2008-09 to 12.4 percent in 2010-11. He says the real rate is around 30 percent. “The data is entirely government data,” he said. “They don’t make any references to commercial sources.”
Hassan Hakimian of the London Middle East Institute told The Guardian the IMF had gone overboard in proclaiming the shift from subsidies to welfare made six months ago to be a success already. “I believe the IMF is on the optimistic side and comes across as rather rash in its judgment. Most independent observers believe it’s too soon to draw such conclusions … and it has not yet produced the required evidence to substantiate the claims made.”
Borghan Nezami Narajabad of Rice University in Texas called the IMF remarks “premature,” adding, “The IMF has completely contradicted its own previous views … and has ignored independent views such as those expressed by the World Energy Outlook.”