Iran needs economic reforms to benefit from sanctions relief, IMF says

IMF official calls political will to make changes essential

DUBAI—Iran’s economy stands to profit from the nuclear deal it struck with six world powers this summer but only if the government makes major revisions to economic and fiscal policies, an International Monetary Fund official said Monday.

“The agreement on Iran’s nuclear program and the envisaged lifting of economic sanctions bring a unique opportunity to build on and broaden the achievements of the past two years,” Martin Cerisola, the assistant director of the IMF’s Middle East and Central Asia Department, said in a statement following a September visit to assess the country’s economy.

But Mr. Cerisola said Iran’s economy was weak and warned that officials needed to make structural changes if they want to reap the full benefits of the nuclear deal. The political will to make these changes, which include withdrawing subsidies, reducing public-sector debt and pursuing a prudent monetary policy, was essential, he said.

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This article was written by Asa Fitch for The Wall Street Journal on Oct. 5, 2015. Asa Fitch writes about economics, finance and investment from The Wall Street Journal’s Dubai bureau. His coverage areas include the economies of the Gulf and the region’s large sovereign wealth funds.