The World Bank cut its forecast of Iran’s gross domestic product (GDP) growth for 2016 to 4.4 percent and for 2017 to 4.9 percent the organization said in an update to its January 2016 Global Economic Prospects report. In the January report, the World Bank had forecasted Iran’s GDP will grow by 5.8 percent in 2016 and by 6.7 percent in 2017. The combination of low oil prices and uncertainty surrounding the timeline for the lifting of sanctions slowed growth significantly.
The World Bank also said Iran’s nuclear agreement opens the door for reintegration of the country into the global economy. In this regard, renewed optimism about the potential of the Iranian economy has already generated a flurry of investment interest by foreign companies. The easing of sanctions has opened the country to international trade and investment. In April 2016, crude oil production was 3.6 million barrels per day (mbd), 25 percent higher than average monthly production in 2015, and already at the upper end of the 0.5–0.7 mbd increase estimated last October for the post-sanctions period. The post-sanctions era also holds strong promise for the Iranian financial services, mineral and metals, and manufacturing industries.