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Iran Can Afford to Say No to a Nuclear Deal

(Washington Institute for Near East Policy) Patrick Clawson - Just how crippling have the sanctions imposed on Iran been? The answer? No longer so much. The Iranian government has slashed spending drastically and permitted the rial to depreciate by about 60% within a few months. This depreciation caused imports to fall by $22 billion and exports to increase by $11 billion, making up for half the loss in oil export earnings caused by sanctions. In short, Iran has brought its economy into line with the resources available under the new sanctions regime. The IMF forecasts that growth in 2014/15 will be 1.5%, rising to 2.3% per year afterward if oil sales do not pick up and sanctions persist. Put another way, Iran's economy under sanctions is poised to grow at about the same pace as the U.S. economy. Sanctions brought Iran to the table, but the regime may be willing to pay the price rather than agreeing to the steps the P5+1 are demanding. The writer is director of research at the Washington Institute.
2014-07-22 00:00:00
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