Iranian banks are a viable instrument for linking the country to the global economic system, said a European banking analyst, Banker News Agency reported.
“To connect the commercial banks to the international market, these banks must first restructure their management methods and solve their financial issues by learning from the experiences of other countries,” said Neil Osborn, managing director of the Euromoney magazine, commenting on the Iranian banking system and its characteristics.
He added that the sanctions imposed on Iran by the UN, the US and EU is the main challenge the country’s banking system faces right now. “Sanctions have influenced the lives of many Iranians.”
Iran is sanctioned by the west in order to curb the country’s nuclear activities. The Iranian administration is working with the P5+1 – the US, Britain, France, Germany, China and Russia – to ease the sanctions in exchange for providing more oversight and restraining its nuclear energy program.
Osborn, visiting the Monetary and Banking Research Institute, also pointed to the low level of Iranians’ income compared to inflation, high-interest on loans, and anemic of investment as major problems facing the Iranian economy.
“Each of these factors alone can seriously harm any given country’s economic structure,” Osborn said. The removal of sanctions against Iran can lead to an immediate increase in economic growth, the expert anticipated.
Reforms must begin in many of the banks’ structure, and their revenue sources from that will become diversified, and finally the way financing production by the banks will be opened, Osborn stated.
All these, he said, accompanied by market stability, could start a bullish cycle that any national economy would prosper from. Osborn mentioned Brazil as a successful example among countries that have overcome financial crisis during the past two decades. Euromoney is an English-language monthly magazine focused on business and finance. First published in 1969, it is the flagship production of Euromoney Institutional Investor plc. Euromoney covers global banking, macroeconomics and capital markets, including debt and equity.
