Except the calculation is based on the official exchange rate of the Iranian rial. Much like Sri Lanka before crisis, Iranian rial has multiple exchange rates which are detached from each other. As the table shows, IRR's official exchange rate has basically detached itself from market reality since 2010. Current figure is basically 6.5 time higher in the market. So if Iran's GDP is USD 1.7 trillion based on the official exchange rate, Iran's GDP is about USD 260 billions based on the free rate. This number is close to Iran's historical GDP growth from previous
The official figure is dangerous though since you are basically manipulating yourself because nobody in the market would exchange 1 USD for only 42000 IRR, they want to get 273000 IRR. If Saudi Arabia, Turkey and Indonesia are doing what Iran is doing, that would put their GDPs to USD 6.5 trillion, USD 4.5 trillion, and USD 8.5 trillion respectively by 2022. That would put us above Japan it seems, why arent we doing that @Indos?
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We did the same I believe during Soeharto regime, during that time I USD equals to Rp 2500 while Today 1 USD equals to Rp 14.700 which is multiple times lower compared to regime Soeharto exchange rate. The different is that the peg was quite strong which make the value of Rupiah traded in open market will be similar with the one controlled by government.
Similar like Iran, Indonesia during Soeharto time is backed by oil money, we still produce oil at around 1.6 million barrel per day compared to Today just less than 700.000 barrel per day with domestic consumption in much higher rate, thus make us suffer from trade deficit in oil sector since 2003.
I see that our currency at that rate is important to keep inflation low as we can buy imported goods at lower price compared to Today value while government during that time also protect domestic market with higher tariff since globalization is not as strong as after WTO deal that limit on how much tariff can be imposed by any nation. So there is no significant tradeoff happening that can impact our domestic industry negatively with that peg system due to government domestic protection policy still give domestic industry room to grow through tariff protection.
The fall of Rupiah in 1997-1998 is due to government inability financially to back their Rupiah rate so that Rupiah should be floated in the open market where the value will be based on market system entirely, It makes our control is only limited to Central Bank market intervention and Central Bank interest rate plus Government USD denominated obligation issuance.
The fall of Rupiah in one hand damage our economy and industry but in the other hand give more competitive advantage for the surviving industries and also our new business players that enter the market after Rupiah is already traded at Rp 8000 (1998-2003) - Rp 14.700 (current price/2022).
I dont know what is the decision of Iran government to keep that government controlled price while the market price is already much lower in term of value. There is big cost being spent by Iran government to keep that rate as they need to compensate the different value between controlled price and market price.
One of the main reason they are doing so IMO is to tame their inflation which is stubbornly high for quite long term. Higher currency rate can tame the price of imported goods. Actually I dont know why Iran inflation is so high, but it could be caused by the economic ministers are not as strong as in many nations, just for comparison our Defense Minister program has been tame by both our Planning Minister and Finance Minister. I suspect their central bank do money printing at excessive rate for quite long time to back the regime politically amid low revenue from oil and gas sector after the sanction in 2008 due to Iran nuclear program.
Their Central Bank is likely not independent enough and can be interfered by their Supreme Leader (Ayatullah Ali Khameini) easily, as I think, similar like Pakistan, their defense budget is relatively higher compared to their overall government budget and some R&D program that doesnt have business feasibility is still pursuit in order to reach their ambition ( turbojet, UCAV program, and so on).
There is nothing wrong with high defense budget and high R&D budget, but it should be managed properly based on what our economy can afford and should have linked to the industry in order to make it business viable thus can make it an economically sustain R&D program with actual benefit to the real economy. For Indonesia case, I think our government still dont regard R&D seriously (they do understand about the important but it doesnt make them spend as much as other countries like India, Iran, Saudi, South Korea, etc )