Iran’s economic growth of 3.7% until the end of 1401 – Tejaratnews
According to Tejarat News, the latest information from the Iranian Statistics Center shows that the rate Economic Growth It was 4.3% excluding oil and 3.8% including it in the spring of 1401.
According to the world of economy, after the publication of the economic growth report of the Iranian Statistics Center in the first quarter of this year, the Majlis Research Center, in a report examining the performance of Iran’s economy in the spring of 1401, examined the game makers of this year’s economic growth.
This 24-page report, with a growth forecast of 3.7% for this year, has provided significant details of the state of all sectors. According to this report, while the economic growth of 1400 was affected by the reduction of the effects of the Corona pandemic and the growth of the service sector, in 1401 the country’s economic growth will be affected by other factors.
The contractionary policy of the world’s major economies and the decrease in global demand, the removal of the preferred currency and its impact on the food and agriculture industries, and the negative effect of cutting off electricity and gas are the main things that affect Iran’s economy this year. It is expected that the mining sector will experience the highest growth this year with a growth of 7.9% and the agriculture sector with a growth of 7.9%. In their latest reports, the International Monetary Fund and the World Bank have predicted Iran’s economic growth in 2022 at 3 and 7.3 percent, respectively.
Therefore, the narrative of the research center is in line with international institutions. The noteworthy point is that the growth of 1400 was reported by the Central Bank as 4.4%. Iran’s statistics center also stated that the growth of last year was 3.4 percent. Therefore, if economic growth of 3.7% is realized by the end of the year, the economic growth level of Iran will be reduced.
Three factors affecting economic growth 1401
In a report, Majlis Research Center analyzed the performance of different sectors of Iran’s economy this year and listed the important and influential factors on Iran’s economy in 1401. This report states that based on the latest evidence of Iran’s economic performance in the first quarter of 1401 and the trends that can be analyzed until the end of the year, Iran’s economic growth in 1401 will reach about 3.7% including oil and 3.9% without oil.
In its report, this institution has listed the events and trends affecting Iran’s economy. Accordingly, the first issue affecting Iran’s economic growth this year is the contractionary policies of the world’s major central banks. First, the expansionist policies of the Corona pandemic era and the noticeable increase in the inflation rate around the world caused the major economies of the world to seek to control inflation by increasing interest rates. The same problem with the decrease in total demand in the world has caused the price of raw materials to decrease in the world markets. This has caused the country’s exports and foreign exchange earnings to decrease. For example, the dollar value of Iran’s steel exports has decreased by 17% in the first quarter of this year.
The second most effective factor in this year’s economic growth is the removal of preferential currency. This spring, the government decided to remove the preferential currency for the import of oilseeds and livestock inputs. Despite the increase in the price of this category of goods and the difficulty of production units in providing working capital, the demand for this category of goods decreased. But it is expected that with price reforms, the motivation for domestic production of basic goods will increase. The third effective and important factor on Iran’s economic growth this year is the issue of energy supply for industries. In 1400, electricity outages in the summer season and gas outages in the winter season caused serious damage to the industry. The risks related to this issue are still present this year, and if it continues, it can severely affect the motivation for future investments in the industry sector.
Improving agricultural production
In another part, this report has also depicted the outlook of the main groups. The agricultural sector is of considerable importance with a share of 12.7% of the country’s gross domestic product. This sector was facing decline in 1400 following the decrease of rains and drought. But the recent report of the Majlis Research Center indicates that following the significant increase in rainfall compared to the last water year, an increase in the production of this sector can be expected.
On the other hand, the increase in the guaranteed purchase price of wheat from five thousand tomans in 1399 to 11,500 tomans in 1401 has set a positive outlook for the production of this strategic commodity. In general, based on the estimates of the Ministry of Agricultural Jihad, about the amount of production of all kinds of agricultural products, including agricultural, horticultural and livestock products, a growth of about 7.9% of the added value of the agricultural sector is expected in 1401.
The decline of the fuel of the oil sector
One of the key sectors of Iran’s economy, which plays the role of driving demand in Iran’s economy, is the oil sector. Although this part of Iran’s economy experienced a growth of about ten percent in 1400, it seems that this significant growth subsided in 1401.
Despite the lack of official statistics published by the Ministry of Oil, the information published by OPEC shows that Iran’s oil production in the winter of 1400 and the spring of 1401 was 2.56 and 2.52 million barrels per day, respectively, which, taking into account the consumption of 1.7 million barrels in the country, It means the daily export of 830 and 860 thousand barrels of oil in these seasons.
It is expected that if the current situation of oil exports continues, there will be no significant growth in this sector. Based on this, for the year 1401, there is an expectation of 1.1% growth in the oil and gas sector.
The report of the Majlis Research Center has used the information published by the mining companies present in the stock market to predict the trend of the mining sector. Based on this, despite the lack of access to detailed information on the production of mining industries and their secondary statistics, it is possible to predict a growth of 9.7% in the spring of 1401, considering the 13.8% growth of the production index of mining companies present on the stock exchange in the spring of 1401. experiences
Industry growth in positive orbit
The industry sector is one of the most key sectors of Iran’s economy, with a share of 7.21% of the country’s gross domestic product, it plays an essential role in growth and employment, and it can affect the total demand through the second channel. Industrial production, based on the index of production of industrial activities in the first quarter of 2011, has faced a growth of 2.9%.
During this period, tangible growth can be observed in the fields of machinery and equipment, automobile and parts, coke and refining, ceramic tiles and textiles. It is predicted that the industry sector will grow by 4.6% in 1401. The service sector, as the largest constituent sector of Iran’s economy, experienced significant growth last year following the recovery of the country’s economy from the damages of the Corona pandemic.
The published statistics of the growth of this sector in the spring of 1401 indicate a full recovery of services and the continuation of the growth of 1400 in 1401 is not very feasible. In general, taking into account the developments of service sub-sectors, the growth of this sector in 1401 is estimated to be around 3.6%.
Housing entering the declining phase
The housing sector is the last sector of Iran’s economy that is considered in this report. The available evidence from building permits issued in 1400 indicates a negative growth of investment in building.
On the other hand, the performance of the government’s construction budget in the first quarter of 1401 shows the negative growth of investment in government non-residential buildings. In total, the growth of the construction sector in 1401 is estimated to be negative 3.4%.
It is important to mention that this estimate is made assuming the continuation of the process carried out in the first quarter of 1401 and, for example, if the national housing leap plan is followed seriously in the rest of the year, it can affect the growth of this sector. In general, the report of the Majlis Research Center states that Iran’s economic growth will reach 3.7% by the end of the year, but it seems that there is an empty place in this analysis, and that is the involvement of the nuclear agreement factor.
According to many experts, the lifting of sanctions and the presence of Iran in the global sector can create a second scenario for economic growth, which is much higher than the prediction of the Majlis Research Center.