Economic and Financial Committee


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Topic A: Competitive Currency Devaluation

For 30 years, the exchange rate regime of the Islamic Republic of Iran was following a multi-layered system where there existed mora than one official exchange rate. It’s important to know that there exists a pre- and post-revolution periods where the Central Bank of Iran (CBI) implemented a fixed exchange rate regime that over the years caused many forms of foreign exchange rate regulations making an emergence of a black market beside the official market. Since March 2002 exchange rate unification took place leading a floating exchange rate regime that resulted in the Dutch disease leading a reduction in price competitiveness, a sharping increase in imports affecting the performance of the currency. To control this situation, the government had a tight control over the oil revenue and letters of credit ensuring that Rial remain relatively stable until 2011 when US ...

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