In the one week since implementation of the first stage of the Geneva agreement and the partial lifting of sanctions against Iran, citizens and experts believe that new hope has been created in Iran’s economic arena but no tangible, positive change has been experienced. During the first days following the signing of the agreement, although foreign currency prices dropped somewhat, the prices reverted to the previous rates several days later. Although several billion dollars of frozen Iranian assets in the US were released, the question is whether this sum can even slightly help the poor state of the Iranian economy. Economic expert Ahmad Alawi, who lives in Stockholm, believes that this is a far lower sum than what Iran needs. According to Alawi, at this stage, in order to exit the stagnation, Iran needs at least $100 billion but at the same time, he believes that the released sum will have a psychological impact, hence the brief drop in foreign currency prices. Alawi adds that in light of basic factors and obstacles to Iran’s exiting its stagnation, the price of the dollar again rose but is expected to balance out. He further says that the scientific, psychological, financial and physical aspects might affect Iran’s economy in the long term, which means that the players in the economic arena cannot immediately stream the released sum into the economy, thereby restoring activity to normal. The processes need time until their effects are felt. For example, with the lifting of sanctions on Iranian shipping insurance, Iran’s oil importers cannot immediately suspend their current transactions to purchase oil from other countries and to immediately return to Iran.
Iranian market anticipates positive impact following implementation of Geneva agreement, but time will be needed
- Published: 2 years ago on Thursday, 30 January 2014
- By: Iran Daily Brief
- Last Modified: January 30, 2014 @ 3:31 pm
- Filed Under: Economy
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