Finance Minister says Iran seeks ‘Resilient’ Economy

He said that in the previous Iranian year ending in March, Iran for the first time had a positive trade balance in non-oil goods amounting to $1 billion. The figure for the first four months of the current Iranian year is $3 billion, he said.

The IMF is predicting that Iran’s gross domestic product will grow by at least 4.5% over the next year, thanks in part to oil exports, which have recovered to pre-sanctions levels, but also because of economic diversification and sanctions relief. The IMF team that recently visited Iran advised the Islamic Republic to strengthen its banking sector, clear up nonperforming loans and implement new laws against terrorism financing and money laundering.

“The staff sees these reforms as critical if Iran is to harness its reintegration into the global economy to spur growth and become a more market-based, diversified economy,” the report said.

Tayebnia told Al-Monitor that Iran has followed this advice. He said Iran had reduced imports, strengthening its currency and facilitating a gradual end to multiple exchange rates.

He said the differential between the official rate of the rial and the market rate is now 14% and predicted it would shrink further. A “big bulk of goods which were purchased using the official rate are now being traded using the market rate,” Tayebnia said.

“In the course of the next two months, the share of the official exchange rate [in trading goods] will be zero. We are very smoothly and gradually doing that reunification without having lots of rhetoric and propaganda about it.”

Iran has also taken steps to improve international confidence in its banking sector. Tayebnia told Al-Monitor that Iran is implementing laws against money laundering and terrorism finance to prevent funds from going to groups such as the Islamic State.

That may not be sufficient to reassure Western banks that are fearful of contact with banks that maintain relationships with Hezbollah and other organizations still on a US State Department terrorism list.

Tayebnia said Iranian banks have installed software to track suspicious transactions, and he expressed confidence that Iran would fulfill an action plan reached with the Financial Action Task Force (FATF), a Paris-based multinational financial watchdog, earlier this year. FATF has suspended countermeasures against Iran for a year, giving it a chance to earn removal from a blacklist that includes North Korea.

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