October 30, 2020
The latest estimates by the International Monetary Fund (IMF) predict the Iranian economy will shrink this year by 5.0 percent, an improvement over the estimate of minus-6.0 percent issued in the spring.
IMF’s October World Economic Outlook showed Iran’s economy would be hurt less than fellow oil producers Saudi Arabia, projected to contract 5.4 percent, and the United Arab Emirates, at minus-6.6 percent, despite the fact that Iran faces sanctions as well as the corona-virus.
Tables provided in the report projected that Iran’s economy would be on a path to return to positive economic growth in 2021 as the IMF expected the country’s gross domestic product (GDP) to grow by 3.2 percent next year, again ahead of Saudi Arabia at 3.1 and the UAE at 1.3 percent.
Some Iranian news outlets did not report the IMF prediction for this year, only telling readers that the IMF projected growth next year.
The IMF report also predicted that the inflation rate in Iran would decrease by more than 10 percent this year to stand at 30.5 percent while it would further reduce to 30.0 percent in 2021. Both are horrible rates, not only among the worst in the world but also far above the Central Bank of Iran’s own goal of 22 percent, still among the worst in the world.
The IMF projected Iran’s unemployment rate would increase by less than two percentage points this year to stand at 12.2 percent and would remain largely unchanged at 12.4 percent in 2021.
The IMF projects that all major economies, except China’s, will contract this year. It estimates China’s growth rate at 1.9 percent. It projects the US economy will contract 4.3 percent, the euro area by 8.3 percent, Japan by 5.3 percent and Canada by 7.1 percent.
A handful of states show large growth, led by Latin America’s Guyana, which is starting to produce oil this year and is projected to see its economy grow an immense 26.2 percent.
