Iran’s nuclear programme has cost more than $500 billion, reveals report
DUBAI: The Arab Strategy Forum, in collaboration with Al-ahram Center for Political and Strategic Studies, on Wednesday issued a report that estimates the total cost of iran’ s nuclear programme to have exceeded more than $500 billion since 2002.
It is one of many annual reports and studies published by the Arab Strategy Forum that is set to take place on Dec.12, 2018 in Dubai.
Launched at a panel discussion ahead of the Arab Strategy Forum 2018, the report, titled ‘The Economic Costs and Consequences of Iran’s Nuclear Programme’, found that international economic sanctions have cost Iran more than US$500 billion to date. Furthermore, the costs of developing and operating infrastructure and facilities for the programme have added some US$50 billion to the bill.
Led by Dr. Sultan Mohammed Al Nuaimi, Associate Professor at Abu Dhabi University and Expert on Iranian Affairs, the panel discussion drew the participation of prominent academics and media personalities. Speaking on the report, Dr Al-nuaimi said: “These gatherings of experts ahead of the event provide an ideal platform to discuss the reports of the Arab Strategy Forum 2018 that add value to the Forum.
“They present researchers with an opportunity to dig deeper into the report and converse with peers, who can offer new perspectives.”
He added: “The report calculates the costs of Iran’s nuclear programme, divided into two categories – direct expenditure on infrastructure and operations, and indirect economic sanctions. The document also examines the consequences of the programme in terms of economic hardship among the population.”
THE COST OF BUSHEHR
Speciically, the report states that the construction of the Bushehr Nuclear Power Plant accounted for the majority of the nuclear infrastructure costs in Iran’s nuclear programme.
Consequently, once completed, the total cost of constructing the plant could reach as much as $12 billion, making it one of the most expensive nuclear power plants in the world, despite the plant’s likely limited technical capabilities, surpassed by plants that have carried less than half of Bushehr’s total price tag.
The report details the cost of building and operating the Bushehr Nuclear Plant as well as related facilities, including uranium mines, processing facilities, enrichment facilities, nuclear fuel production infrastructure, and isotope separation facilities. It also outlines the stages of the international economic sanctions on Iran since the discovery of its secret nuclear facilities in 2002.
Due to the new US sanctions following the US administration’s withdrawal from the Iran Nuclear Deal, economic losses are expected to surge in 2018.
The US administration has declared that the re-imposed sanctions on the Iranian economy will span two phases. The irst phase, in effect since August 2018, sanctions Iran’s trade in gold and other precious metals, raw materials, aluminium, and coal, as well as the trade in Iranian rial and investment in Iranian bonds abroad, and the country’s automotive industry.
The second phase took effect in November 2018, and includes sanctions on the Central Bank of Iran as well as the inancial, shipping, and energy sectors with the aim of bringing Iran’s oil exports down to zero.
The adverse economic situation in Iran has led to frequent protests in various regions across the country throughout the past years, with protestors citing inlation, unemployment, poverty, and corruption as their main concerns.
DECLINE IN INVESTMENTS
The report highlights how the ongoing sanctions on Iran have limited foreign direct investment (FDI) low to the country. Moreover, foreign companies have cancelled new investment contracts worth tens of billions of dollars, especially in the energy sector that needs between US$130 billion and US$300 billion of new investments to maintain productivity until 2020.
As a result, unemployment rates in Iran have risen, especially among youth.
About one-third of the country’s young people have no job opportunities, which fuels their frustration with the local economic situation.
The value of the Iranian rial has also plummeted due to sanctions, especially the recent US sanctions, which led to a surge in the price of the US dollar on the black market to IRR112,000 in August 2018, compared with IRR36,000 on the oficial market in early 2018, before the new sanctions regime.
The inlation rate has witnessed unprecedented levels and is projected to reach an annual average of 203 per cent by end-2018 according to some estimates.
Various economic sectors in Iran were affected by the sanctions and their consequences. Notably, the oil sector, which the country’s economy heavily relies on, has seen production and exports decline.