International Monetary Fund: Stability of Poverty and Unemployment Rates Despite Iran's Economic Growth

The International Monetary Fund (IMF) in its latest detailed report on Iran's economy reiterated the country's economic growth rate of 6.6% for the current year, predicting that this rate will average about 4.2% over the next five years. The country's Gross Domestic Product (GDP) is expected to rise from $377 billion this year to $472 billion by the year 1400 (2021). However, according to this report published on the official IMF website, Iran's unemployment rate is expected to remain around 12.2% over the next five years. The unemployment rate has risen from about 10.6% in 2014 to approximately 12.5% this year. The report also adds that the rate of individuals living below the poverty line, defined as earning $5.5 per day (based on 2011 purchasing power), has fluctuated back to about 10% in 2008 and reached the same rate in 2014, with expectations of it being around 9% in the coming years, which is higher than the rates from 2011 to 2013. Despite this, the IMF assesses that Iran has managed to reduce its inflation rate from about 45% in mid-2013 to around 8.9% this year, although it is expected to rise slightly over the next two years and ultimately return to single digits between 1398 and 1400 (2019-2021). Overall, the IMF's analysis of Iran's economic outlook is positive. Regarding Iran's economic growth, the report states that due to the increase in oil prices and export volumes, Iran's oil GDP has reached 5.2%, while the growth of the non-oil GDP is around 0.8%. However, this rate is expected to average 5.7% in the coming years, with the non-oil sectors expected to average over 4.5%, indicating better growth in the non-oil GDP compared to previous years. For instance, last year this indicator was negative 2.7%, while the growth of the oil GDP was 6.4% and the overall GDP of Iran was negative 1.8%. Regarding oil, the report adds that Iran's oil exports are expected to increase by an average of 100,000 barrels per day by the year 1400, reaching 2.9 million barrels per day. Currently, this figure is about 2.4 million barrels per day, which is double the volume of 2014. However, despite a half-million barrel increase in Iran's daily oil exports in 1400, the growth in Iran's oil production will be nearly three times this amount, with production expected to rise by 1.4 million barrels to 5.4 million barrels per day. These figures include crude oil and gas condensates. These statistics indicate that, according to the IMF's assessment, Iran will increase its oil refining capacity by nearly one million barrels per day. The rise in Iran's growth rate is mainly a result of the return of oil production and exports to pre-sanction levels. Currently, Iran's refining capacity is about 1.8 million barrels per day. Iranian officials claim that they will increase this figure to 3.1 million barrels in the next five years, but the IMF's figures on Iran's oil production and exports suggest that this international organization has assessed Iran's refining capacity growth to be lower than the Iranian government estimates. The report further states that this year, Iran's oil and gas export revenues are likely to reach $57.4 billion, which is 70% more than last year. Last year's oil revenues were about $33.6 billion. This figure is projected to be $65.3 billion next year and about $75 billion by the year 1400. These figures are significantly lower than Iran's oil revenues during Mahmoud Ahmadinejad's presidency, where for example, oil revenues in 2011 were about $110 billion. Oil prices have dropped from above $105 since mid-2014 and are currently at half that amount. The IMF has predicted that oil prices will remain stable in the range of $55 to $57 over the next five years.