Overview: Iran Analysis Weekly Report June 19, 2016
19 June, 2016
Vistar Business Monitor
Supreme Leader Ayatollah Ali Khamenei discussed America’s implementation of the nuclear agreement and stated, “If they tear up the JCPOA, we will set it on fire.”
Mr. Khamenei asserted that Iran will not be the first party to violate the nuclear agreement during remarks delivered at a meeting with government and military officials, including President Hassan Rouhani and Parliament Speaker Ali Larijani. He added that America’s differences with Iran are over “the existence of the Islamic Republic and cannot be solved through negotiations.”
President Hassan Rouhani announced that Iran has filed a lawsuit at the International Court of Justice (ICJ) over the U.S. Supreme Court’s recent ruling allowing the victims of terrorist attacks attributed to Iran to collect almost $2 billion in Iranian frozen assets. Rouhani added that Iran “demanded the condemnation of Washington’s anti-Iranian efforts and compensation for damages” and promised to “pursue this case until its conclusion.” Rouhani also referenced the 1983 Marine barracks bombing in Lebanon, stating, “It is not clear what the Americans did in Lebanon and how this is related to Iran.”
An official at the Central Bank of Iran (CBI) said that Iran has dispatched a team of “experts” to the U.S. to negotiate the retrieval of $2 billion in Iranian frozen assets. A U.S. Supreme Court ruling in April allowed the victims of terrorist attacks attributed to Iran to collect the assets. The CBI official’s statement follows President Hassan Rouhani’s announcement on June 15 that Iran has filed a complaint against the U.S. with the International Court of Justice over the assets.
President Hassan Rouhani delivered a speech on June 15 following a meeting with Judiciary Head Ayatollah Sadegh Amoli Larijani and Parliament Speaker Ali Larijani. Rouhani reiterated Supreme Leader Ayatollah Ali Khamenei’s recent statements on the importance of the implementation of the Resistance Economy doctrine, stating, “As the Supreme Leader of the Revolution has said, the country’s power depends on its economic and scientific power and providing opportunities for the youth to make the best use of their science, knowledge, and technology.”
He said that his administration has been successful in increasing oil and condensates sales, curbing inflation, stabilizing the currency market, improving trade with world countries, increasing non-oil exports and creating 1.34 million job opportunities.
On the economic note, the banks reached a consensus last week to further lower deposit rates to 15% from currently 18%. This time the banks were not forced by the Money and Credit Council to cut the interest rates, a phenomenon that shows the money market is acting more rationally.
The banks eventually admitted that high deposit rates could lead to a war among them to attract more deposits by offering higher interest rates, a process that could increase risks and the cost of money. At present only few businesses may make a profit more than 20% per annum, a situation which helped bank cut deposit rates for the second time in less than six months.
The unemployment rate in the winter of 1394 rose 0.3% compared to that of the same quarter a year before. However, at the same time economic participation improved, proving that citizens were more hopeful to find a job. The SCI has release the unemployment report of the winter, showing that the unemployment rate among people aging 15 years and older was 11.8, up from 11.5% in winter of 1393 (2015).
Output from OPEC member Iran rose by 80,000 bpd to reach 3.64mn bpd in May 2016 – a level last pumped in June 2011 before the imposition of more rigorous sanctions.
Iranian crude oil exports last month rose by more than 130,000 bpd to 2.1mn bpd. Supply from the UAE also climbed by 70,000 bpd after oilfields returned from scheduled maintenance. Saudi Arabia’s production edged up to 10.25mn bpd, according to US Energy Information Administration (EIA) estimates.
On the diplomacy note, as Iran is worried about commitments brought by the JCPOA, Iranian foreign minister and his American counterparty continue to negotiate in Norway. The negotiation between Zarif and Kerry lasted for 80 minutes behind closed doors.
Commitments of the United States to the JCPOA and the Syria crisis were the cornerstone of the negotiations. A day before the talks, the U.S. issued directives to reduce the disambiguation exiting in whether or not the country can have trade with Iran without being worried about possible punishments by the U.S.
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