Wed Jan 20, 2016 10:59AM
Iranian President Hassan Rouhani speaks at a news conference in Tehran, January 17, 2015. (Photo by IRNA)
Iranian President Hassan Rouhani speaks at a news conference in Tehran, January 17, 2015. (Photo by IRNA)
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Officials from Iran and the P5+1 met Saturday, January 16, 2016, and told the world the deal was now in effect.

Under US pressure, the Security Council adopted six resolutions against Iran in the past decade. The IAEA Board of Governors too adopted 12 resolutions against the Islamic Republic within the same period. All of them were removed when the nuclear deal took effect.

What that means is that all restrictions on trade and investment in oil, petrochemicals, metals, shipping, shipbuilding and other transportation industries, as well as banking, insurance and other related services, including Iran’s ability to move money electronically overseas were rescinded.

In addition to those, Iranian oil money and other assets frozen in different banks for different reasons for years will be unfrozen. Those assets are said to be worth 150 billion dollars. Now, the country says it's determined to make up for its slow progress as much as possible and restore normalcy to its economy. That may have been the reason why President Rouhani submitted next year's budget bill to the parliament a month and a half later than he did in years 1 and 2 of his presidency.

The budget for the next Persian year, which will begin on March 20, is different than the budgets for the previous years in one aspect. A sharp decrease in the number of sanctions. Now the government can count on a flow of foreign investment and technology into the country, and avoid the extra expenses it would have to incur to circumvent those restrictions.

The proposed budget is asking for 83.2 billion dollars, a figure attainable if Iran continued to sell oil for 40 dollars a barrel. According to this budget, Iran will have to sell at least 2,250,000 barrels of oil next year. Also, the budget is based on an exchange rate of 29,970 rials to the dollar. But that is the official rate and differs from the market value of the dollar that now stands at a little over 36,000 rials. Some believe these figures especially the price of each barrel of oil as arbitrary.

When the proposed budget was handed to the Majlis, Parliament Speaker Ali Larijani called on the government to come up with two twelfth plan instead because the legislative body wasn’t able to hold deliberations on the new budget with only two months to end of the current Persian year.

Economists say the Iranian economy has caught the Dutch disease. It is the negative impact on an economy of anything that gives rise to a sharp inflow of foreign currency, such as the discovery of large oil reserves. Experts say that in order to cure the Dutch diseases, money earned from oil sales, should be withheld from the budget, and that the government should try to secure its current expenses and if possible its constructions expenditures via taxation.

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