It was a deal seemingly brokered at the last minute, but one that even a couple of weeks ago, didn’t seem likely at all.
But now that Iran has signed on the dotted line and agreed with the P5+1 group of countries to limit its nuclear program in exchange for an easing in the economic sanctions that have progressively made things extremely tough for the country, a 30-year impasse has been breached, and that perhaps, is the biggest deal of all with respect to Iran’s economic and political future.
As yet, there hasn’t been any concrete action, and sanctions still in place include, among others, restrictions on investment in Iran’s lucrative oil sector and on its banking system.
However, the agreement indicates an easing of sanctions could happen fairly quickly and in a variety of key areas, said Nader Habibi, Henry J. Leir Professor of the Economics of the Middle East, in Brandeis University’s Crown Center, and senior lecturer in the Department of Economics there, such as the auto industry, petrochemical exports, gold and imports of medical equipment and medicine, the lack of which have made day-to-day life in Iran extremely difficult.
All of these will help the Iranian economy almost immediately.
Already, the exchange rate is more stable “and the hysteria of hoarding dollars that caused the exchange rate to collapse in 2012 is over,” Habibi said.
Although the deal is temporary giving Iran has six months to meet certain conditions, not least bringing down its already enriched stockpiles of uranium to below the acceptable level of 5% and not enriching any new reserves to above that limit, it is still extremely important for Iran and the Iranian economy, Habibi said.