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Iran’s stimulus package unveiled by the government last month to revive the economy (MEES, 23 October) will be delayed for some time because the required broader economic reforms are not yet ready, Iranian officials and economists have indicated.
The package, which aims to boost investment in productive activities, includes a cut in interest rates for depositors (from 20% to 18%) and for borrowers (from around 24%), a reduction in the “legal reserve requirement” from 13% to 10%, lower interbank rates, and other measures to extend loans and credit facilities aimed at quantitative easing in the economy. But these will have to be accompanied by reforms to banking and other economic sectors to yield the expected results, officials warn. (CONTINUED - 860 WORDS)