On the real impact of sanctions USA on the economy Iran
There are theories about the insignificant effect of sanctions on the economy of the recipient country or the widespread conclusion of Hufbauer about their effectiveness only in 30% of cases. CNBC has published a study proving the opposite with the example of US sanctions against Iran. Let’s consider the main points.
• Iran’s economy has been steadily declining since 2017. In 2020, GDP fell by 4.99% over the previous year. For comparison, in 2016, after the signing of the nuclear deal in Iran, there was a sharp economic growth.
• Sanctions have weakened Iran’s position in the oil market. The IMF estimates that oil exports from the Islamic Republic will continue to decline in 2021. Restrictive measures hit not only oil, but also the import / export of industrial metal.
• Billions of dollars owed to Iran for oil delivered are frozen in bank accounts in Iraq, South Korea and China. The Iranian government cannot take advantage of them and inject them into the economy because of the American sanctions.
• The interdependence of the following processes is noted – a fall in the exchange rate and an increase in unemployment. According to IMF estimates, 12.4% of the population will be unemployed in 2021. The Iranian government, in turn, is spending beyond its means, and its budget deficit is growing.