Majlis: Economic Growth Under 0.5 Percent

Roozonline - IRAN: First in Inflation and Last in Growth While Mahmoud Ahmadinejad’s administration has for years refrained from providing statistics on the state of Iran’s economy and the numbers published by the Statistical Center and the Central Bank on inflation, unemployment, GDP and other monthly or annual figures have been ruled unrealistic by Majlis deputies, economists and international organizations, Majlis’ Research Center has now published figures that show the country’s economic growth in 2012 (1391 in the Persian calendar) to be 0.39 percent, positioning the country as the second last in the region.

These figures are published after Ahmadinejad last October told the Majlis economic growth was “over 10 percent,” even though his own minister two days later said that real economic growth in Iran was 5.1 percent. All of these contrasting figures are inconsistent with the economic realities on the ground.

While the fifth development plan of Iran originally provided for over 8 percent economic growth for 2012, putting Iran at the top of all regional countries, in reality there has been a 74 percent deviation from that, making those projections and plans comical.

According to Mehr news agency, the report published by Majlis’ Research Center reads, “Iran’s economic growth in 2012 stood at 0.36 percent which ranks Iran the 23rd country in the region and 164th in the world in economic growth. Projections estimate that Iraq, Afghanistan, Uzbekistan, Turkmenistan and Kuwait will display to have had the highest economic growth in the region in 2012. Iraq, Kuwait and Armenia have experienced the most significant change in ranking in the region in the last two years. Iran’s rank slipped from 18th in 2010 to 23rd in 2012.”
According to Majlis’ report, Iran’s economic growth was even less than that of Syria which is going through a civil war and better than only one country in the region, Yemen, which occupies the country with the lowest economic growth in the world.

This report also mentioned that while the Central Bank had put Iran’s inflation in August at 21 percent, Iran had the highest inflation rate in the region and sixth highest in the world.

But even this gloomy picture is said not to represent the real dire state of the Iranian economy. The Economist for example has written that the country’s economy is much worse than what the Majlis report indicates adding that economic activity was a negative 1.1 percent compared to the previous year, something that has caused harm to the economic infrastructure of the country.

It should be noted that the statistics that were used by the center to conduct its research predate the sharp drop in the value of the Rial, the oil sanctions against Iran and other developments such as the crises in the gold exchange between Iran and Turkey or the imbalanced gas price contract between Iran and Pakistan.

Generally, economists do not trust the statistics that Ahmadinejad’s administration has been providing since it came into office in 2005, making figures provided in 2004 as the only and last reliable figures on the economic state of the country. Iran’s economy was reported to have grown at about 7 percent in those days. This figure was used to project the next 5-year economic plan to stand at a reasonable 8 percent. But the performance of Ahmadinejad’s first and second terms now indicates that the economic growth during these 8 years at best stood at 0.39 percent.

Writing on the discrepancies in economic figures, Iran’s Donyaye Eghtesad opined that Iran’s economy suffered not from low rates but from unstable rates. “Unstable rates meant inability to plan economic and business activity and investments, thus killing or disregarding business opportunities.”