Quantcast
Iran draft budget eyes growth, more oil sales despite sanctions - Metro US

Iran draft budget eyes growth, more oil sales despite sanctions

Iran's President Ebrahim Raisi meets Syria's Foreign Minister Faisal Mekdad in Tehran

DUBAI (Reuters) -Iranian President Ebrahim Raisi presented an upbeat state budget on Sunday that aims for 8% economic growth and increased crude oil sales of 1.2 million barrels per day (bpd) despite continued U.S. sanctions.

World powers and Iran were locked in talks this week on reviving their 2015 nuclear deal and lifting U.S. sanctions, with Britain and Germany warning that time may be running out.

Iran’s top budget official has said the fiscal plan for the next Iranian year which starts on March 21 was drawn up on the assumption that the U.S. sanctions would continue.

“The growth projects include 4.5% in investment growth and 3.5% in productivity growth,” Raisi told parliament, presenting the draft budget based on 1.2 million bpd in oil exports projected at a price of $60 per barrel, according to state media.

In November, imports of Iranian oil by its main customer, China, were estimated at over 500,000 bpd and Iranian estimates of total exports have been as high as 900,000 bpd.

State media gave the value of the nominally balanced budget at 15,052 trillion rials, equivalent to $50.2 billion at the free market exchange rate of the Iranian currency.

The new budget is about 10% bigger than the current budget in local currency terms although its value in real terms is lower due to annual inflation running at more than 40%.

The semi-official Tasnim news agency said the budget allocates about $5 billion to strengthen Iran’s defence programme.

The Institute of International Finance (IIF) said in a report in June that Iran’s economic recovery is likely to be modest should it revive the 2015 nuclear deal without expanding the scope of the pact.

The United States reimposed sanctions, crippling Iran’s economy by driving down crude sales, the Islamic Republic’s main source of revenue, after Washington withdrew in 2018 from the nuclear pact.

The draft budget has to be passed by parliament and approved by a clerical body that vets legislation before it becomes law.

($1=300,000 rials at the free market rate)

(Reporting by Dubai NewsroomEditing by Gareth Jones, Raissa Kasolowsky, William Maclean)

More from our Sister Sites