Numerous Challenges Facing Inflation Reduction

Since any analyst who has monitored the state of Iran’s economy over the past years invariably speaks of high inflation as one of the key factors in giving rise to economic difficulties, the government is required to place special programs on its agenda to reduce inflation, Abbas Argon, vice chairman of Money and Capital Market Commission of Tehran Chamber of Commerce, prefaced an article for the Persian daily Ta’adol with this note. A translation of the full text follows:
One of the main challenges facing Iran’s economy is the large size of the government, the domination of which over many economic fields has restricted the space for the activities of private sector. On the other hand, when a problem emerges concerning the government’s financial resources, we notice that the economy faces problems. 
When we experience restrictions on oil revenues and as we have not carefully prepared the mechanism for collecting fair and accurate taxes, the situation gives rise to a budget deficit, which in turn can give rise to inflation. Therefore, to make efforts to downsize the government and make it more agile by paying attention to the capacities of the private sector can prove to be an important step in reducing inflation. 
As a result, while the government is expected to reduce inflation, it is being recognized as the cause of inflation, and the large state economy itself is an important obstacle to improving the conditions of Iran’s economy. The state-owned economy has spread the shadow of politics over the economy. 
Reducing sanctions, improving relations with other countries, either in the region or in the world, returning stability to economic indicators and, of course, making the future predictable are among measures that can lift the spirit of the society about the future of the economy, which can in turn reduce inflationary expectations. 
As we have seen recently, negative and positive news can have an impact on our markets and, therefore, the more stability in the economic environment increases, the more inflation will reduce.
The main cause of inflation is generating more money than producing goods and offering services; therefore, when there is a production boom, a part of inflation can be managed by using the emerging capacities. However, production requires investment growth, but our performance in the past decade has not been positive in this regard. 
Downsizing the government and providing the real private sector with opportunities, as well as diversification of the economy and putting politics aside, are measures that must be seriously placed on the agenda so that we can witness a reduction in inflation.