The Iranian economy saw a modest recovery in the second half of 2020 after more than two years of economic recession. Limited access to foreign exchange reserves and limited other external funding sources put pressure on the exchange rate and higher inflation in 2020-2021.
The coronavirus pandemic (COVID-19) has further increased economic pressure on the most vulnerable. Iran’s economic outlook depends on the development of the coronavirus pandemic (COVID-19), the pace of the global economic recovery, and the possibility of US sanctions easing. The economy is at a crossroads and urgently needs a stimulus plan with comprehensive and coordinated macro-financial reforms.
Growth-promoting reforms such as investments in green infrastructure, the digital economy and renewable energies can help bring the economy out of the pandemic and create much-needed jobs. The report also includes a section with a special focus on poverty and inequality in Iran at the onset of the COVID-19 pandemic.