Iran is expected to expand its economy by 4 per cent in 2016 after recording flat growth last year, according to the latest IMF World Economic Outlook.

Iran is benefitting from the lifting of the majority of sanctions against its economy in January after a nuclear agreement between Tehran and world powers was approved.

The Washington-based IMF forecast that Iran’s real GDP would grow by

• 4 per cent in 2016
• 3.7 per cent in 2017
• 4.1 per cent in 2021

Iran’s economy shrank in both 2012 and 2013 as tougher sanctions were introduced.

The IMF forecast that Iran would record a current account deficit of 0.8 of GDP in 2016, dropping from a surplus of 0.4 per cent last year. Tehran’s current account balance is expected to be flat in 2017.

Relief from sanctions is expected to allow Iran to attract significant foreign investment across its economic sectors. However, in the three months since sanctions were lifted, this has been slower than many analysts expected.

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