The head of the International Monetary Fund in the Mideast said Iran’s economy has beat expectations by growing by 4.5 percent this year.

The Islamic Republic could keep that pace if it can “move on addressing some of the other restraints in their economy.”

Chief among them is modernizing both its banking system and its manufacturing industry, both of which were affected by sanctions, Masood Ahmed told The Associated Press on Tuesday.

Iran’s economy has charged ahead through boosting oil production close to levels seen before Western nations imposed economic sanctions over its nuclear program. Iran will have to modernize both its banking system and its manufacturing industry, as well as allow more foreign direct investment in the country, to continue that growth.

“The big challenge for Iran is can you sustain that 4-, 5-percent growth over the medium term or is it just a one-time increase you get?” Ahmed asked. “They can, but they have to move on addressing some of the other constraints in their economy.”

He also said that Mideast countries are making efforts to cope with low oil prices, though more needs to be done.

Oil-producing countries “still have some way to go” in reforming the government sector and cutting spending, he noted.

(Source: AP)