Domestic Economy

Tayyebnia Simplifies Economic Data

Tayyebnia Simplifies Economic DataTayyebnia Simplifies Economic Data

In a television interview on Saturday on the occasion of the Government Week, which started August 24, Minister of Economic Affairs and Finance, Ali Tayyebnia provided a brief review of his ministry's performance over the past two years since the administration of President Hassan Rouhani assumed office in August 2013.

"When the new government took office, the country had experienced negative economic growth of -6.1%. This figure increased to 3% during the past Iranian year (ended March 20)," he noted.  

Tayyebnia said breaking free from government-dominated and oil-based economy and increasing financial transparency are essential to sustainable economic growth.

He also said passing new regulations for improving the business environment led to a boost in the World Bank's ranking of ease of doing business in Iran from 152 among 189 countries in 2013 to 130 in 2015.

He said the economy ministry is pursuing eight major projects which "will make considerable difference in key structural areas", including drafting a comprehensive plan for the national tax system, implementing smart treasury management system, increasing productivity of government properties, upgrading and diversifying the financial system, organizing the justice shares, improving the business environment, facilitating international trade and creating a suitable platform for integration and coordination of various government agencies.

Taming inflation was another major achievement highlighted by the economy minister. "When the government took office, the inflation rate stood above 40%. However adopting contractionary policies and reducing dependence on oil revenues helped curb uncontrolled growth of liquidity," he said.

"Hence, year-on-year inflation was brought down from 15.2% in the first quarter of the last Iranian year to 14% by the year's end," he noted.

> Two Key Strategies

According to Tayyebnia, two major strategies were adopted by the government to reduce liquidity growth and in turn, the inflation rate: first, reducing the share of oil revenues in the national budget and second, improving the trade balance.

"As per the first strategy, the share of oil revenues in the fiscal budget was lowered from the previous 43% to 33% in the current year's budget," said Tayyebnia.

In terms of non-oil trade balance, the minister noted that the $8 billion trade deficit in 2013 has given way to trade surplus.

He also referred to improvement in the business environment and competitiveness through privatization and providing government funding to the private sector as other measures adopted for reducing the government's dominance in the economy.

The minister predicted a positive prospect for the capital market. "The country is eventually stepping out of recession and the government will help revive the capital market by injecting liquidity," he said.