New research from the Iran 2040 project evaluates Iran's water crisis & central bank
Why has Iran's Central Bank systematically failed to achieve its goal of price stability? Just how bad is Iran's water crisis, and what options does the country have to address it? These are some of the questions addressed in two new reports released by the Iran 2040 Project this summer.
By Mohsen Mesgaran, Pooya Azadi
Iran’s water crisis is entering a new paradigm where its impacts are becoming visible in the daily lives of millions of people. Today, the average annual water consumption in Iran is estimated to be around 96 billion cubic meter (BCM)—a figure that is about 8% higher than Iran’s total renewable water resources (89 BCM) or about 80% higher than the scarcity threshold level of the country (about 53 BCM). The practical solutions that can potentially help Iran address its formidable water crisis can be grouped into those that seek to (i) improve water productivity (e.g., modernization of irrigation, expansion of greenhouses, and optimization of crop pattern) and (ii) selectively terminate some water-intensive activities. The authors argue that given the massive imbalance between sustainable supply and demand for water, the ultimate potential reductions in water use by the solutions targeting productivity will not be sufficient to change the calculus in Iran. Read the full report here.
By Razieh Zahedi and Pooya Azadi
Authors Razieh Zahedi and Pooya Azadi discuss the evolution of macroeconomic policies in Iran and provide an overview of the country’s monetary policy landscape. The latter part discusses the structural aspects of the Central Bank of Iran (CBI) and evaluates its performance based on key monetary and banking variables. The banking system in Iran, they warn, is faced with multiple intertwined crises that have brought the country’s financial sector to the verge of a major collapse. In the absence of a prompt and determined policy response, these crises are likely to be compounded in an accelerating manner. At the end of the report, they recommend institutional and policy reforms to improve monetary policy outcomes in the future. Read the full report here.
Established in 2016 by the Moghadam Program in Iranian Studies, the Iran 2040 Project serves as a hub for scholars to conduct research on issues related to the future of the Iranian economy and their possible implications in a global context. The initiative's core research includes economy, population, energy, water, agriculture, and the financial system.