Last month, government spokesman, Mohammad Baqer Nobakht, announced that 66 FDI projects worth $5.16 billion were being implemented after the nuclear agreement came into effect in January.
“These projects are mostly in transportation, renewable energy, tourism, recycling, electronic industries, food and machinery,” he said.
The nuclear deal signed by Iran and the six world powers (the five permanent members of the UN Security Council plus Germany) in July 2015 saw the easing of sanctions on Tehran in exchange for limits on the scope of its nuclear program.
Kamel Taqavinejad, the director of Iran’s National Tax Administration, said $80 billion in foreign investment will be needed to achieve the 8% annual economic growth enshrined in the sixth five-year economic development plan (2016-21).
“Attracting foreign investment depends on peace and stability. The government of President Hassan Rouhani has managed to create both in the country,” IRNA quoted Taqavinejad as saying last month.
The Statistical Center of Iran recently reported that Iran’s gross domestic product expanded by 4.4% in the first quarter of the current Iranian year that started in March, compared with the same period of 2015.
The economy emerged from recession two years ago with a 3% growth. The rebound in economic output followed two years of recession when the economy contracted 5.8% and 1.9% back to back. Last year’s growth was officially put at 0.9% by the SCI.
Government officials predict a 5% GDP growth this year, which is slightly above World Bank’s 4.2% and 4.6% estimated for 2016 and 2017 respectively.
The International Monetary Fund sees a 4-4.5% GDP growth over the medium term.
The president and government officials have often said decent growth rates would not be possible without substantial foreign investment in key sectors, namely oil, gas, transportation, heavy industries, energy, infrastructure and health. Their reasoning is based largely on the steep decline in the international price of crude that has taken a beating over the past two years, falling to $40 a barrel from $110 in 2014, reports Financial Tribune.
The Iranian Mines and Mining Industries Development and Renovation Organization estimated in its annual general meeting held on Saturday that Iran’s mining sector requires $15.3 billion in foreign direct investment to meet the goals stipulated in the Sixth Plan.
Development plans are laws drafted by the government and ratified by parliament every five years since 1991 and are meant to provide the broad directions for a wide range of economic reforms and social priorities.