Iran

Politics:

• Analysis

  Iran politics: First candidates announced ahead of the June election

  Just three months ahead of Iran's presidential poll, scheduled for June 14th, the field of candidates remains opaque. This reflects the lack of clear party structure in Iran but also the growing effect of international sanctions over Iran's nuclear programme. The legacy of the disputed 2009 presidential election-when the supreme leader backed the now unpopular president, Mahmoud Ahmadinejad-has also sparked internal tension among Iran's conservative camp. However, a repeat of the unrest in 2009 is unlikely, with the regime carefully orchestrating the process to ensure a more amenable and managerial figure takes the role.

  Iranian elections often take shape late and throw up surprises. So far, just two candidates have declared themselves: Manouchehr Mottaki, a former foreign minister, and Mohsen Rezaei, secretary of the Expediency Council, while Mohammed-Bagher Ghalibaf, the mayor of Tehran, is widely expected to run. All are conservatives.

  The election will mark the end of Mahmoud Ahmadinejad's term in office, as he is constitutionally ineligible to stand for a third term. Any chance to amend the laws to allow for another term would fall flat with a hostile parliament. Mr Ahmadinejad's departure will be welcomed by many in the establishment, including senior clerics and associates of Ayatollah Ali Khamenei, the supreme leader, after years of economic mismanagement and populist policies that sought to increase the prominence of the presidential role at the expense of the clerical elite. The election in June will also mark a referendum of sorts on Iranians' approval of their leadership. Ayatollah Khamenei will look to a high turnout in the election as a mark of support for the country's leadership and its stance over the nuclear issue-whether in agreeing to additional talks with the West or in strengthening popular resolve in the face of sanctions or even US or Israeli military attacks.

  Ayatollah Khamenei would therefore appreciate candidates who can motivate voters before the election and then be called upon during their tenure to take some of the heat out of domestic Iranian politics, especially in improving the government's relations with parliament, the leader's office, the senior clerics and the central bank. A calmer and more unified atmosphere might also make it easier to manage the economy more effectively in the face of tightening sanctions.

  The field so far

  Mohsen Rezaei, 58, is a conservative with an independent streak and a lively Farsi-language news website. But when Mr Rezaei stood in the 2009 election, he won only 1.7%, coming third behind Mr Ahmadinejad and the reformist Mir-Hossein Mousavi. Mr Rezaei was also a candidate in 2005, but withdrew in the last week ostensibly to prevent a split in the fundamentalist camp, which still at that point had three candidates. He has been a critic of Mr Ahmadinejad and has considerable experience and impeccable credentials. Earlier in his career, Mr Rezaei served as commander of the Islamic Revolutionary Guards Corps (IRGC) in 1981, aged only 27, and held the post until 1997.

  Since 2007 he has been secretary of the Expediency Council, which arbitrates disputes between state bodies, including cases of deadlock between parliament and the Guardian Council, an Islamic constitutional watchdog. The Expediency Council was influential in drafting emergency legislation in the aftermath of the 1980-88 war with Iraq, but it has declined in power in recent years and has not given Mr Rezaei a high public profile.

  Manouchehr Mottaki, 59, was foreign minister from 2005 -10, after earlier serving both as an MP and an official for 24 years in the foreign office, including stints as ambassador to Turkey and Japan. Given his role as campaign manager for Ali Larijani, the parliamentary speaker and perennial opponent of the president, in the 2005 election, Mr Mottaki's subsequent appointment as foreign minister by Mr Ahmadinejad was a surprise and he never became a strong force in foreign policy, partly because of the influence Mr Ahmadinejad sought to exert over Iran's external relations and partly because of the predominance of the nuclear issue, which is handled by the Supreme National Security Council (SNSC). However, neither Mr Rezaei nor Mr Mottaki are especially charismatic and prospects appear more favourable for a candidate with more panache.

  Ghalibaf-another ex-mayor of Tehran for president?

  Mohammed-Bagher Ghalibaf, 51, has not declared his candidacy, although it is widely expected and last year a close aide said he would run. Mr Ghalibaf has wide experience as mayor of Tehran since 2005, and prior to that national police chief and a distinguished IRGC officer, including during the Iran-Iraq war. Charismatic and articulate, he ran an effective campaign in 2005 as a conservative moderniser, although his apparent decline in support towards the end of the campaign-coming fifth of seven candidates-may have reflected his slick campaigning alienating senior clerics. Articulate and well presented, Mr Ghalibaf has used his role as Tehran mayor, a position in which he succeeded Mr Ahmadinejad, to raise his profile.

  Any colour you want ...

  Another possible conservative candidate is Ali Larijani, the parliamentary speaker, but although a capable politician, he fared poorly in 2005, gaining just 5.9%. Ali Akbar Salehi, the erudite foreign minister, has also been talked of as a possible runner, and although he said in a recent interview with an Austrian newspaper, Wiener Zeitung, that he did not "feel fit enough for the job" his candidacy cannot be ruled out. Said Jalili, the top security official who has led the Iranian side in negotiations over the nuclear programme with the P5+1 (the five permanent UN Security Council members and Germany), could benefit from the high profile he has garnered recently as well as close links to Ayatollah Khamenei.

  ... so long as its conservative

  Under election rules, all candidates need endorsement by the Guardian Council, which vets them for suitability. It is widely expected that the Council, which is in conservative hands, would not accept any close ally of the president, especially his controversial aide, Esfandiar Rahim Mashaei, now chief of the secretariat of the Non-Aligned Movement.

  The reform candidates, who performed strongly in 2009 and prompted large street protests that the regime cracked down on, are unlikely to make it past the Guardian Council. Two reformist candidates from the 2009 election, Mir-Hossein Mousavi and Mehdi Karrubi, remain in effect under house arrest since the unrest following the poll. A coalition of reformist groups has recently written to Ayatollah Khamenei requesting a meeting, probably with the intention to call for the field to be opened up outside the conservative camp. The reformists have different options over the election, varying from backing a conservative pragmatist to calling for a boycott, a move that could provoke a strong conservative backlash, potentially in the form of leading reformists being blocked from public life or imprisoned.

  A heavy hand from the regime in favour of one of its preferred candidates could spark a backlash in another form however. Iranian voters may hold off from participating if they believe the results of the election have been pre-determined, and thus raising doubts about the legitimacy of the regime in the face of harsh international sanctions. Further, Iran's nuclear programme, which is supported widely across the political spectrum, is unlikely to emerge as a campaign issue lest one candidate be accused of being prepared to kowtow to the West's demands. In the aftermath of the poll, a more unified Iranian leadership may be more prepared to engage in serious negotiations with the P5+1.

  March 07, 2013

• Background

  Iran: Political forces at a glance

  Political outlook: Political forces at a glance

  Present government: The president, Mahmoud Ahmadinejad, who was elected in June 2005 and re-elected for a second and final term in 2009, will face a hostile parliament for the remainder of his term and will be unable to maintain his unorthodox and populist conservative agenda. Mr Ahmadinejad appears to have lost a degree of support from the supreme leader, Ayatollah Ali Khamenei, owing to his support for figures who are opposed by the religious establishment. The president's attempts to chart an independent line on domestic and international affairs will be sharply curtailed. Nevertheless, he will remain an outspoken and confrontational figure both at home and in Iran's dealings with foreign partners or adversaries.

  Parliamentary forces: Seeking to keep in check the more extravagant measures advocated by the president is a 290-member directly elected Majlis (parliament). The current Majlis was elected in March 2012 for a four-year term, and a conservative alliance of parties opposed to the president won 182 of the available seats. The United Fundamentalists Front, led by the speaker of parliament, Ali Larijani, won the single largest block of seats, empowering this ally of Ayatollah Khamenei. Parliament, which will receive at least tacit support from the supreme leader, will continue to challenge the authority of the president through legal means, such as sending his proposals for assessment by the judiciary and periodically threatening figures close to Mr Ahmadinejad with impeachment. However, parliament holds little power over foreign or security policy. It also has a limited impact on the budget, as a large share of Iran's government spending is granted to state-enterprises, which are not accountable to the legislature.

  Extra-parliamentary forces: In addition to the presidency and parliament, a number of other institutions play a role in the Iranian political system. Chief among these is the supreme leader. This is an institutional embodiment of the political concept at the heart of Iran: velayat-e-faqih (rule of the Islamic jurisprudent). The current supreme leader is Ayatollah Ali Khamenei, who has in the past tended to adopt an inclusive approach to power, allowing both hardline and moderate figures to influence policy. However, Ayatollah Khamenei has recently made moves against the president (such as reinstating a minister Mr Ahmadinejad had dismissed) and has said that the post could be removed at some point in the future. The clerical establishment behind Ayatollah Khamenei will focus on controlling the political scene in the forecast period by ensuring that an unpredictable president or parliament is not elected. To do this, the religious institutions of the state will play a more active role. The Expediency Council's public role is to mediate between the Majlis and the Guardian Council, a 12-man body appointed by the supreme leader, which in practice is dominated by senior clerics. The Guardian Council vets legislation and political candidates for their Islamic conformity. The supreme leader remains vital to the stability and ultimate direction of the system. In theory he can be removed by the Assembly of Experts, which is made up of clerical figures. However, this is unlikely, not least because the Guardian Council is responsible for approving the candidates for election to the Assembly.

  July 25, 2012

• Structure

  Iran: Political structure

  Official name

  Islamic Republic of Iran

  Legal system

  Based on the constitution of 1979, which was amended in 1989

  Legislature

  290-member Majlis-e-Shuray-e Islami (National Assembly). All candidates for the Majlis must be approved by the 12-member Guardian Council, six of whom are appointed by the supreme leader (rahbar) and six by the judiciary. Majlis legislation must also be approved by the Guardian Council. The Expediency Council mediates between the Majlis and the Guardian Council

  Electoral system

  Universal adult suffrage for elections to the Majlis, to the Assembly of Experts (the body that chooses the rahbar) and for the presidency

  National elections

  Next elections: March 2016 (legislative); June 2013 (presidential)

  The supreme leader (rahbar)

  Ayatollah Ali Khamenei

  Head of state

  President, elected by universal suffrage for a four-year term for a maximum of two terms. Mahmoud Ahmadinejad was controversially re-elected in June 2009

  Executive

  The post of prime minister was abolished in 1989. The current cabinet was approved by the Majlis in September 2009

  Main political trends

  Parliamentary factions are loose. The new Majlis is dominated by the United Fundamentalist Front and the Stability of Islamic Revolution Front, both conservative groups close to the supreme leader

  President: Mahmoud Ahmadinejad

  Head of presidential office: Gholam-Hossein Elham

  Key ministers

  Commerce & industries & mines: Mehdi Ghazanfari

  Culture & Islamic guidance: Mohammed Hosseini

  Defence: Ahmad Vahidi

  Economy & finance: Shamseddin Hosseini

  Education: Hamid Reza Hajibabai

  Energy: Majid Namjou

  Foreign affairs: Ali Akbar Salehi

  Health: Marzieh Vahid Dastjerdi

  Intelligence: Haidar Moslehi

  Interior: Mostafa Mohammed Najjar

  Justice: Morteza Bakhtiari

  Petroleum: Rostam Qasemi

  Speaker of the Majlis: Ali Larijani

  Head of the Supreme National Security Council: Said Jalili

  Head of the Management & Planning Organisation: Amir Mansour Borghei

  Head of the Iranian Atomic Energy Organisation: Fereydoun Abbasi-Davani

  Central bank governor

  Mahmoud Bahmani

  January 03, 2013

• Outlook

  Iran: Key developments

  Outlook for 2013-17

  • The supreme leader, Ayatollah Ali Khamenei, will maintain his authority throughout the forecast period. His rule has been strengthened by the success of candidates loyal to him in the March 2012 parliamentary election.
  • The president, Mahmoud Ahmadinejad, will move into the background in his final months in office owing to an antagonistic parliament. A more compliant candidate is likely to be elected in June's presidential poll.
  • Tensions with the US and its allies will persist over Iran's nuclear programme. We do not expect Israel or the US to launch a military strike against Iran, but we anticipate no diplomatic breakthrough either.
  • Iran's fiscal position will be weak in the forecast period, as tax revenue falls owing to the fragile economy, and as oil income declines. The net fiscal deficit is forecast to average 4.3% of GDP a year in 2013-17.
  • After declining by an estimated 3% in 2012, real GDP is expected to contract by a further 1.3% in 2013, as sanctions hinder exports of crude oil and private consumption declines. Anaemic GDP growth is forecast in 2014-17.
  • Bank Markazi (the central bank) will struggle to maintain the value of the rial as its access to foreign exchange is crimped by sanctions. Inflation will remain high but will decline from an estimated 30% in 2012 to 15% in 2017.
  • As a result of declining oil sales, the current account is expected to record small deficits throughout the forecast period.

  Review

  • Mr Ahmadinejad has cancelled a planned visit to Turkey. The deployment of NATO missiles in Turkey will raise tensions with Iran as the countries differ in their views on the civil war in Syria. But Turkey will adopt a pragmatic approach in relations, given Iran's important economic links to the country.
  • The new sanctions imposed by the US on Iran include the head of its nuclear energy agency. At the same time, however, the International Atomic Energy Agency has reported a positive visit to Iran, although it has still not visited the disputed Parchin military facility.
  • The US has extended waivers to sanctions that prohibit transactions with Iran's central bank (which clears most oil payments). The waivers affect most of the major buyers of Iranian oil, including China and India.
  • Iran has pledged a loan of US$500m to Pakistan to help it construct its side of a Iran-Pakistan gas pipeline. However, US pressure on Pakistan to replace the Iranian gas with LNG from Qatar may stymie the project.

  January 03, 2013

Economy:

• Background

  Iran: Country fact sheet

  Fact sheet

  Annual data	2012a	Historical averages (%)	2008-12
  Population (m)	75.6	Population growth	1.1
  GDP (US$ m; market exchange rate)	478,449	Real GDP growth	1.8
  GDP (US$ m; purchasing power parity)	977,342	Real domestic demand growth	2.2
  GDP per head (US$; market exchange rate)	6,327	Inflation	19.2
  GDP per head (US$; purchasing power parity)	12,924	Current-account balance (% of GDP)	3.8
  Exchange rate (av) IR:US$	12,184b	FDI inflows (% of GDP)	0.7
  a The Economist Intelligence Unit estimates. b Actual.

  Download the numbers in Excel

  Background: Iran became an Islamic Republic after a popular uprising overthrew the regime of the pro-Western shah in 1979. As vali-e-faqih (the supreme Islamic jurisprudent), Ayatollah Ruhollah Khomeini became the supreme religious and political leader. From 1980 to 1988 Iran was at war with Iraq. On his death in 1989, Ayatollah Khomeini was succeeded by Ayatollah Ali Khamenei (who lacked his predecessor's religious credentials). Mohammed Khatami, first elected president in 1997, tried to introduce social and political reforms, backed by a reformist Majlis (parliament). However, the conservative establishment blocked these efforts, and in 2004 and 2012 conservatives won control of parliament. In 2005 and again in 2009 Mahmoud Ahmadinejad, a populist conservative, was elected to the presidency. Disputes over the fairness of his re-election in 2009 led to some of the most intense street protests since 1979.

  Political structure: Iran is defined as an Islamic Republic in its constitution. The president is elected every four years by popular vote, although all candidates must be vetted by the Guardian Council. Superimposed on this republican constitutional structure are several unique Islamic features: the vali-e-faqih exercises considerable power over the government, and the conservative Guardian Council approves all legislation to ensure that it complies with Islamic law.

  Policy issues: Iran's five-year economic plans have emphasised a gradual move towards a market-oriented economy, but political and social concerns as well as international sanctions have hampered progress. Iran's policymakers are now focused on developing an economy that will be resistant to international pressures, but their success is likely to be limited. Iran has in effect returned to a multiple-exchange-rate system in order to protect its foreign-exchange reserves, and the government has wavered over the reform of the subsidy programme.

  Taxation: Iranian tax laws are complex and have been applied inconsistently. The government has lowered unified corporation tax rates and aims to simplify tax administration, but progress will continue to be slow, and foreign firms are likely to continue to face some uncertainty when assessing their tax liabilities.

  Foreign trade: Oil earnings comprise over 80% of export revenue. A tightening of sanctions, particularly those imposed by Europe, will put a strain on Iran's ability to export oil. Iran's oil and non-oil trade will suffer throughout 2013-17 as trade partners seek to engage with other countries out of fear of running foul of sanctions

  Major exports 2010	% of total	Major imports 2010	% of total
  Oil & gas	79.3	Intermediate goods	46.6
  Petrochemicals	2.9	Capital goods	36.0
  Fresh & dried fruits	2.0	Consumption goods	17.4
  Leading markets 2011	% of total	Leading suppliers 2011	% of total
  China	21.0	UAE	30.6
  India	9.3	China	17.2
  Japan	8.9	South Korea	8.4
  Turkey	8.7	Germany	4.8

  Download the numbers in Excel

  Download text file (csv format)

  March 15, 2013

• Structure

  Iran: Economic structure

  Data and charts: Annual trends charts

  
  

  

  January 03, 2013

• Outlook

  Iran: Country outlook

  Iran: Country outlook

  FROM THE ECONOMIST INTELLIGENCE UNIT

  POLITICAL STABILITY: The Economist Intelligence Unit expects the supreme leader (and ultimate religious and political authority), Ayatollah Ali Khamenei, to retain his post throughout the forecast period, whereas the hardline and confrontational president, Mahmoud Ahmadinejad, will be required to step down at the end of his second term in June. We do not expect a repeat of the level of political discontent witnessed after Mr Ahmadinejad's re-election in 2009, as the conservative establishment around Ayatollah Khamenei will stage-manage the candidate-vetting process much more closely, and any reform-minded candidates are unlikely to be approved. However, the impact of expanded international sanctions is compounding already high domestic political tensions. In this context, with economic hardship increasing, there is a risk of outbreaks of social unrest, especially if political in-fighting among the elite continues.

  ELECTION WATCH: A parliamentary election in March 2012 was a boon for Ayatollah Khamenei, as a conservative group close to him that has in the past been fiercely critical of Mr Ahmadinejad won a big majority. The next presidential election is scheduled for June 2013. Mr Ahmadinejad is in his second and final term. The supreme leader will probably intervene to support a candidate of his choosing and manage the process to avoid a repeat of the bitter 2009 campaign (and subsequent street protests). Recent raids on reformist newspapers and detentions of journalists illustrate the regime's intention to stage-manage the presidential election. Manoucher Mottaki, a former foreign minister, and Mohsen Rezaie, a former commander of the Revolutionary Guards, have so far announced their candidacy.

  INTERNATIONAL RELATIONS: Disputes over Iran's nuclear programme will persist in 2013. The US and the EU will maintain financial and trade sanctions on Iran in an attempt to coerce it into making concessions on its nuclear policy. The Islamic Republic has retaliated with threats to shut the Strait of Hormuz, a vital oil supply chokepoint, but neither side appears eager to engage in actual confrontation. As both sides seem keen to avoid an escalation, negotiations between Iran and the P5+1 (the five permanent UN Security Council members and Germany) have resumed, but have so far made little progress aside from agreements to continue discussions. This absence of a grand bargain reflects a deadlock over reciprocity--Iran will not consider suspending uranium enrichment without at least some of the more significant sanctions being lifted, but the US considers the maintenance of these sanctions vital to ensuring a shift in Iranian thinking.

  POLICY TRENDS: With sanctions set to remain in place, Iran will aim to increase its economic self-sufficiency. Government investment will prioritise the oil and gas sector, but raising finance to increase production will be affected by sanctions, and Iran may struggle to replace lost oil output. Although the government has announced plans to invest considerable sums in a number of areas, including refineries, we believe that government investment will be constrained by lower oil revenue. The privatisation programme will also continue, but will only be open to domestic investors. Many of the privatisations involve "justice shares" distributed to the public, and others appear to have entailed shifting assets between different parts of the Iranian state. We expect the privatisation process to slow in the forecast period as the number of available firms suitable for divestment diminishes.

  ECONOMIC GROWTH: Real GDP growth will be held back by sanctions on Iran's oil exports, high inflation and declining oil production. We expect the economy to contract by 1.3% in fiscal year 2013/14 (March 21st-March 20th), following an estimated contraction of 3% in 2012/13, as crude exports and production continue to suffer under US sanctions and the EU import embargo. The economy is forecast to recover slightly in 2014/15-2017/18, growing by an average of 1.6%, assuming that Iran's oil exports start to edge up again as the major purchasers of Iranian oil adjust to international sanctions. Such growth is substantially below Iran's historical trend and potential given its hydrocarbons wealth, and in real terms the economy will remain smaller than it was in 2011/12 until 2016/17. Given uncertainty about the course of sanctions and diplomacy, the risks to this forecast are considerable and mostly on the downside. A further tightening of sanctions could lead to even slower growth than we currently expect, leaving the economy hamstrung throughout the forecast period.

  INFLATION: Inflation will remain high, driven primarily by sanctions, which have caused a dramatic weakening of the unofficial value of the rial and surging prices for imports-owing both to the weaker exchange rate and to scarcer supply. Iran is a major consumer of refined fuel, and a shortage of domestic production capacity means that the country will need to import petrol, exacerbating vulnerability to imported inflation. In calendar 2012 prices averaged 27.2% higher than a year earlier, but displayed a dramatic acceleration toward the end of the year (with prices in December nearly 40% higher year on year). Official average inflation is forecast to fall gradually from 28% in 2013 to around 15% in 2017. In the face of declining government revenue, there is a risk that the authorities will print money to fund spending. This would feed an inflationary spiral.

  EXCHANGE RATES: The rial's market value has fallen by as much as 80% since 2011, reaching a low of around IR35,000:US$1 in October 2012. Press reports indicate that the exchange rate fluctuated in the range of IR33,000-36,000:US$1 in January 2013 but had started to strengthen on the back of talks between Iran and the West. In the short term, Iranians will shift their savings into safer assets such as gold or the US dollar. Bank Markazi has tried to limit depreciation by raising interest rates, introducing a new multiple-exchange-rate system and opening a foreign-exchange centre to satisfy demand for dollars; further moves to control the exchange market are likely in a bid to stabilise the rial. The official rate has been set at IR12,260:US$1, with a IR15,000:US$1 rate for importing capital and intermediate goods. All other imports are purchased using the black-market rate. Given the barriers to accessing foreign exchange owing to sanctions, and the loss of confidence in the currency, these official rates will be difficult to maintain. We therefore project further modest depreciation over the forecast period, although the volumes of transactions at these rates may be very low.

  EXTERNAL SECTOR: Iran's external balances will be weakened by sanctions. The trade balance will have deteriorated from a surplus of US$36bn in 2011/12 to a small deficit in 2012/13 as exports of crude oil declined sharply. We expect the trade balance to move back into a small surplus from 2013/14, but growth in the surplus will be curbed by new restrictions on the purchase of Iranian industrial and agricultural goods. Unlike many other Middle Eastern oil producers, Iran will be less sensitive to US consumption patterns, given a long-standing prohibition on US imports of Iranian oil. The non-merchandise deficit is expected to remain relatively steady. The restrained import bill will suppress growth in services debits, and income debits will be depressed by reduced foreign participation in Iran. Following more than a decade of current-account surpluses, we estimate that Iran will have recorded a deficit of 1.9% of GDP in 2012/13. We forecast small deficits, averaging 0.5% of GDP, over the forecast period, reflecting the ongoing squeeze on crude exports.

  March 11, 2013

• Forecast

  Iran: Country forecast summary

  Country forecast overview: Highlights

  • The supreme leader, Ayatollah Ali Khamenei, will maintain his authority throughout the forecast period. However, economic hardship in the context of tough international sanctions presents a risk of political instability. Debate between the confrontational president, Mahmoud Ahmadinejad, and parliament will persist during his final months in office. A more pliant candidate is likely to be elected in the June presidential poll.
  • Political stability is expected to increase after the departure of Mr Ahmadinejad. The presidential election will probably be heavily stage-managed by the regime to ensure a compliant candidate is selected. Iran will remain committed to its nuclear programme, and any compromises are unlikely unless it receives significant concessions from the West.
  • Tensions between Iran and the West and Israel over Iran's nuclear programme will persist, but we still do not expect a military clash. The US, the UK and the EU will maintain sanctions on Iran in an effort to force the Islamic Republic to curtail its nuclear ambitions. Iran may oscillate between adopting a more confrontational stance and attempting to engage in diplomacy in its attempts to manage the pressures it faces.
  • UN and unilateral sanctions against Iran will hinder efforts by the government to attract investment (especially into the hydrocarbons sector) and will encourage it to pursue economic self-sufficiency. However, the weak economy will contribute to social unrest that could build against the regime.
  • The government will need to tighten its fiscal stance as revenue continues to be affected by lower oil receipts caused by sanctions. Parliament has cast doubt on the sustainability of subsidy reforms, begun in 2010. Nevertheless, a new president from mid-2013 will probably be required to consolidate spending. The net fiscal deficit is forecast to average 4.2% of GDP a year in 2013-17.
  • After declining by an estimated 3% in 2012, real GDP is expected to contract by a further 1.3% in 2013 as sanctions weaken exports of crude oil and private consumption declines amid high inflation. We forecast anaemic GDP in 2014-17 as oil exports stabilise at a lower level, with a base of demand from the major Asian purchasers of Iranian crude. However, this forecast is subject to substantial—largely downward—risks. The current account is forecast to post small deficits throughout 2013-17 as oil output and receipts decline.

  

  March 15, 2013

View detailed map

Country Briefing

Total area

163.6m ha

Population

73.6m (2010, Statistical Centre of Iran)

Towns with populations in excess of 500,000

Population in '000 (2007, Statistical Centre of Iran):

 Tehran (capital): 7,705

 Mashhad: 2,411

 Isfahan: 1,583

 Tabriz: 1,379

 Shiraz: 1,205

 Qom: 1,042

 Ahvaz: 790

 Bakhtaran (formerly Kermanshah): 643

Climate

Continental, with extremes of temperature

Weather in Tehran (altitude 1,220 metres)

Hottest month, July, 22-37°C (average daily maximum and minimum); coldest month, January, minus 3-7°C; driest month, July, 3 mm average rainfall; wettest month, January, 46 mm average rainfall

Official language

Persian (Farsi)

Measures

Metric system. Some local measures are used, including: 1 jerib=0.108 ha; 1 artaba=0.66 hl; 1 rey=11.88 kg

Calendar

The Iranian year begins on March 21st, and contains 31 days in each of the first six months, 30 days in the next five months and 29 in the 12th month (30 in every fourth year). The system relates to the Prophet Mohammed's flight from Mecca in 622 AD, but, unlike the Islamic calendar, follows solar years. The Gregorian equivalent can be found by adding 621 years to the Iranian date. The Iranian year 1391 began on March 21st 2012

Currency

Rial (IR); IR10 = 1 toman. (Although all government statistics are given in rials, in conversation Iranians refer to tomans.) The multiple exchange rate was replaced by a single floating rate at the start of fiscal year 2002/03

Time

3.5 hours ahead of GMT

Public holidays

Many holidays are religious and based on the Islamic year. Exceptions include New Year (Nowruz) celebrations (March 21st-24th)

January 03, 2013