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Iran's economy a 'masterpiece of structural ambiguity'

For President Hassan Rouhani to realize his campaign pledge to revive the Iranian economy, he must find a way to rein in the quasi-state sector.
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The economy dominated Iran’s recent presidential election. Hassan Rouhani, the incumbent, argued that integration into the global economy is the only path to prosperity and job creation, while his rivals accused his administration of having ignored the poor. Rouhani's opponents also promised to create millions of jobs, double the size of the economy and triple monthly cash payments to low-income families. In the end, most Iranian voters preferred Rouhani's path. Whether President Rouhani can deliver on his promises remains unclear, as does whether the head of government is powerful enough to realize any pledge to fundamentally revive the economy.

The distinct division between the public and private sectors of national economies as generally understood by economists does not apply in Iran. Iranian university professor Amrollah Ghadiri wrote in a May 1 editorial for the leading daily Donya-e Eqtesad, “It is time for us to separate the government as the executive branch from the state and organizations affiliated with the state in studying the economy.” In short, study of the impact of government policy must take into account the so-called quasi-state sector in Iran.

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