
Iran Risk June 2018
The decision by Donald Trump pull the US out of the nuclear deal will have impacts for Iran’s economy, its finances, inward investment and the politics of the region.
Economic risk (MEDIUM): Assuming the sanctions are imposed, there will be negative impacts on GDP, the budget and current account balances and unemployment.
Political risk (MEDIUM): Scrapping the keynote nuclear deal that will strengthen the hands of reformist president Hassan Rouhani’s opponents.
Financial risk (MEDIUM): The banking system is weak with inadequate capital ratios, high leverage ratios, and high non-performing loans. However debt is low and reserves adequate.
Commercial risk (MEDIUM): Iran is in the middle of the World Bank’s Doing Business table but is hard to tell how much the semi-collapse of the nuclear deal will deter global investors.