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An estimated 80 percent of the Iran’s economy in the hands of the state and its religious foundations. However, the Iranian government is committed towards increasing the private share of the economy consistently over several 5-year plans.
In 2014, gross domestic product is estimated to amount to approximately 407 billion US dollars. After significant declines, owing to international sanctions, between 2012 and 2013, the economy showed signs of recovery in 2014, with the growth rate showing a rise of 3 percent in the GDP.
The major economic sectors of Iran include oil and gas industry, petrochemical industry, automotive industry, agriculture and metal industry. Inflation is currently given by officials to stand at around 13.8 percent. The unemployment rate is 10.8 percent according to official figures. The unemployment rate is expected to rise as every year, about 750,000 new workers enter the Iranian labour market, but a proportionate number of jobs isn’t being created.
Iran is ranked at 130 among 189 nations in the Ease of Doing Business Index. However, the tense business climate will probably improve significantly in the wake of sanctions waivers.
Foreign trade of Iran is heavily under the influence the existing international sanctions regime, but has stabilized last year and will stabilize even further in the wakes of concrete talks that will most probably result in the removal of these sanctions on the country. The exports for 2014, stood at 86.5 billion USD, while the imports were to the amount of 65.1 billion USD (EIU data). The oil and gas sector generated in 2014 more than 50 percent of Iran's export revenues. Since July 2012, however, Iran’s major trading partner, EU, hasn’t imported oil due to sanctions. But this effect is mostly countered by the rise in Iranian petroleum exports to Asia. Currently they stand at 1.1 billion barrels/day, a 20 percent rise over 2013. Other exports of the country are agricultural and traditional goods (carpets, fruits, pistachios) and industrial products (motor vehicles and parts, steel, petrochemical products). Important trading partners of Iran are China, the United Arab Emirates, Iraq, Turkey, South Korea, Pakistan, India and Afghanistan.
Why invest in Iran?
- The future complete lifting of international sanctions will fuel the Iranian economy and set it back on its growth path. So, investing in Iran is a very viable opportunity, currently.
- Iran central location in the Middle East serves as a very attractive proposition for investors. It borders 7 regional countries directly and has maritime borders with a further 3. This has made the country a potential trade hub in the region.
- Iran’s population is relatively young in the region, and has access to some of the finest universities in the Middle East region. Due to Iran’s isolation in recent years, the population has also been pushed towards becoming increasingly self-sufficient which translates into better problem solving potential of Iranian employees.
- Iran’s economy is labour rich with an adequate yearly supply of fresh workers.