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A nuclear deal with the West would give Iran a chance to kickstart the economy

Iranians Hope for Nuclear Deal With West to Kick-Start Economy, NYT  By  OCT. 28, 2014 For more than a year, President Hassan Rouhani has been dangling the prospect of a bright economic future before the middle classes that elected him, promising to complete a deal with the West to limit Iran’s nuclear program and end the sanctions hobbling the Iranian economy.

While the deadline of Nov. 24 is fast approaching, it is far from clear whether the two camps will agree on a pact. What seems certain, analysts say, is that with oil prices falling seemingly daily — and projected to drop even further — the oil-dependent government of Iran faces growing pressure to settle the nuclear standoff.

In one sign that Tehran might be bending, Obama administration officials and the chief American negotiator, Wendy Sherman, were said to be briefinglawmakers and allies last week on the outlines of an agreement, hoping to building support in advance of an announcement.

Iranian officials will never admit that either sanctions or low oil prices have any effect on their bargaining position in the nuclear talks. Yet, for a country that by some estimates needs an oil price of more than $140 a barrel to balance its budget, the roughly 25 percent drop in oil prices to around $80 a barrel since last summer has to be deeply concerning.

The precipitous decline could force the government to cut back popular benefits, like subsidies for gasoline and utilities and the $12 monthly cash benefit that Iranians have come to consider a birthright. And it could have even broader effects, possibly sending the economy into recession and pressuring the country’s currency……..

In Plan A — Mr. Rouhani’s vision — a nuclear deal would lead to the lifting of all sanctions, and the Iranian economy would become a tempting paradise for foreign investors……….http://www.nytimes.com/2014/10/29/world/middleeast/iranians-hope-for-nuclear-deal-with-west-to-kick-start-economy.html?_r=0

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October 29, 2014 - Posted by | Iran, politics international

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