TCCIM examines wisdom of currency redenomination

Financial Tribune – In a comparative study the Economic Research Department of Tehran Chamber of Commerce, Industries, Mines and Agriculture has probed the experience of currency redenomination in other countries and the context within which the policies were implemented.

Referring to the rial revaluation plan on the government agenda, the study points to similar decisions by other countries and says “the policy does not necessarily produce the desired results. Its success or failure is contingent upon the groundwork (before and after) for enforcing the plan”.

It said such plans have been successful in countries where governments have implemented comprehensive policies to overhaul the economy prior to embracing the redenomination strategy.

Moreover, in these countries corrective policies have been maintained by implementing a “stabilization program” years after enforcement of the redenomination plan.