Facilitating foreign financing has been among the top items on Iranian President Hassan Rouhani’s agenda since the signing of the nuclear deal in 2015. Under the current circumstances, with domestic lenders grappling with a credit crunch, the best alternative appears to be embracing foreign capital to help boost economic output. In addition, the Islamic Republic’s Sixth Five-Year Development Plan (2017-2021) stipulates that 25% of funding should be provided through foreign investment, including foreign direct investment (FDI), contractual arrangements and financing.
In a 2015 study conducted on the requirements for 8% annual growth, it was concluded that achieving such a target would require $28-$50 billion of foreign capital per annum. This survey sought to determine the amount of investment required to realize the growth rate, excluding the amount of capital that could be accessed by the means of domestic savings in the banks. When the results of the study were announced, Masoud Nili, the special presidential aide for economic affairs, who apparently supervised the study, reiterated, "It should be noted that the figures mentioned in the report as foreign capital point to FDI. They do not include [foreign] financial investments or financing,” reported economic daily Donya-e-Eqtesad on Dec. 12, 2015. Regarding the findings of the study, Nili also remarked that the required capital would be subject to two conditions in the Iranian economy: First, the economy should have the underlying potential to attract foreign resources, and second, a robust, proactive private sector should be emerging.
