Experts: Capital Depreciation Has Caused Destruction of Iran’s Economy

While recent reports from the Iranian market indicate rising inflation and price increases across all economic sectors, a burden that has become unbearable for the middle and poor classes, officials of the Islamic Republic continue to attribute inflation, rising prices, and shortages to sanctions and international restrictions.

Iran’s economy in recent years, concurrent with the decline in coronavirus-related activities and the conditions resulting from international sanctions, has faced prolonged stagnation in productive sectors and high inflation in service and commodity sectors.

Meanwhile, economic experts say that even the revival of the JCPOA will have no positive effect in improving Iran’s economic situation, just as the JCPOA agreement during the Obama era did not lead to economic improvement and better living conditions for the Iranian people.

Jamshid Asadi, an expert on economic issues, in an interview with Voice of America, stating that the structure and roots of the economy in the Islamic Republic are damaged, said: “In recent years, not only has no new investment been made in Iran, but previous capital and investments have gradually disappeared.”

Stating that in the past few years Iranians have not had much inclination to invest in the country, he emphasized: “Even if the JCPOA is revived, foreign investors are not willing to return to Iran and accept the investment risks in the country, unless the government guarantees their capital with oil.”

Last month, the head of the Iran Chamber of Commerce had also told the assembly of the Chamber of Commerce representatives: “If the JCPOA agreement is finalized and sanctions and restrictions are lifted, the approach to managing Iran’s economy should shift towards development economics; otherwise, like the first round of the JCPOA agreement, injecting money into the country will only lead to an increase in imports, not sustainable investment development.”

According to Gholamhossein Shafaei, Iran’s economy in the past few decades, particularly in the last 10 years, has faced very high inflation, economic stagnation, and very low and poor quality employment creation, and the expansion of poverty and inequality, and usually economic policymakers, by adopting palliative policies, have postponed radical solutions to problems to the future.

Source: Voice of America