Strategic Assessment
Following two years of slowdown resulting from severe international sanctions, Iran’s real economic growth was rejuvenated in 2014-15. Consequently, and thanks to its social welfare policy, the Iranian regime managed to prevent any significant erosion in the quality of life for most of the population, as well as any significant social unrest. Three main factors contributed to the economic turnaround and renewed real growth: the rise in total gross investment in the economy – thanks to a rise in private investment and despite the drop in public investment; the impressive rise in non-oil exports; and exploitation of the barter agreements, which ensured the major portion of import financing required for the economy and population. This development represented a strategic turning point for the regime, resulting in increased internal strength (social and economic) and the possibility of increased maneuverability in nuclear talks. As time passes, the economic factor bolsters, rather than weakens, Iran’s ability to maneuver in negotiations.