Majlis Think Tank Offers Solutions to End Data Discrepancy

EghtesadOnline: The research arm of the Iranian Parliament has called on two organizations in charge of publishing economic data to work more closely and form a joint committee to curb actions that could erode public trust.

News ID: ۷۷۴۴۶۹

08 March 2017

Discrepancy in key economic indicators such as inflation rate and GDP figures in recent time had created confusion, prompting the Leader of Islamic Revolution Ayatollah Seyyed Ali Khamenei to urge officials to be accurate and forthright with their data.

In its latest statement, Majlis Research Center noted that the Central Bank of Iran and the Statistical Center of Iran are responsible for drafting and releasing statistics pertaining to national accounts, IBENA reported.

The statement notes that these statistics are extremely important, as they shape the opinion of businesses, policymakers and the public, adding that the manner in which they are published "has always been one of the challenges facing policymaking in the country" as they are not always available and have been at odds with each other on many occasions, Financial Tribune reported.

"In 2012-13 and 2013-14 when economic growth was negative, neither CBI nor SCI released any GDP data," it said, noting that it was only with the start of the tenure of President Hassan Rouhani in mid-2013 that growth figures for these two years were disclosed.

MRC takes issue with the "intermittent" way of publishing data by these two bodies, referring to 2014-15 when CBI published economic growth statistics while SCI remained silent and in 2015-16 when the situation was reversed with CBI remaining inert while SCI came up with figures.

As to the current fiscal year (ending March 20), MRC states that although CBI published GDP data for the first half of the year ending September 21, no entity provided details other than announcing that a 7.4% GDP growth has been achieved . This is "totally against professional principles and accepted international statistical norm", especially since CBI had not published the growth rate for the previous fiscal year.

Furthermore, the central bank proceeded to announce a figure for this year only after the president gave a figure in one of his speeches, which could "set a bad precedent for statistical releases in future", as it creates the possibility of statistical bodies deferring their tasks to elected officials, which can erode public trust.

Common Base Year

The research body advised CBI and SCI to use a common base year for their data and preferably choose the base year currently used by CBI, the Iranian year of 1383 (2004-5), as opposed to the more distant year of 1376 (1997-8) employed by SCI.

According to MRC, it is necessary for the two entities to work more closely and consistently with each other to figure why their numbers do not match.

To do so, "forming a permanent joint committee for the two entities, comprising of their representatives and experts, can prove to be helpful", it added.

In mid-February, CBI's deputy for economic affairs, Peyman Qorbani, announced that "CBI will shift the base year from 2004-05 to 2011-12 for calculating Iran’s economic growth in the third quarter of the current fiscal year [ending March 20]".

The International Monetary Fund recommends updating the base year for calculating GDP at least once every five years.