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Area: 1,648,195 sq. km

Population: 78,631,000 (2014, est.)

Capital: Teheran

GDP: USD 416.5bn (2014, est.)

Exports: USD 95.71bn (2014, est.)

Imports: USD 61.25bn (2014, est.)

Currency: Iranian Rial (IRR)

Exchange rate: 1 USD = 33.859,7735 IRR (01/2016)

 

Economic Structure and Development:

Iran’s economy is mainly state-owned. The private sector comprises of the agriculture and service sectors, commonly known as the Bazaar. However, the banking and insurance industry, as well as an estimated 80% of the large-scale industry, remain essentially in the hands of the public sector authorities. Aware of the need for comprehensive strategy on market-based reforms, Iran has set the goal to increase the privatization of state owned enterprises by 20% each year in its current five-year plan (2011-2016). Such three forms have already seen some success, for instance in the aviation sector in the founding of a number of private companies or domestic air-traffic. International air transport, however, is still run by the state owns Iran Air.

About 40% of rents population is under the age of 24. Although there are many well-educated young people, in 2013 the unemployment rate was estimated at an alarming 16% of the available labour force of 27.7m. Iran is therefore in need of a skilled labour force. Due to this, Iran has initiated reforms to improve the education system and facilitate access to education and training. In addition to an overall decline in Iran’s economic performance, high unemployment rates and rising inflation have affected the lives of many Iranians in recent years due to the rising prices or for basic food and consumer goods. In 2012, inflation rate of consumer prices stood at 30.5%, increasing to an estimated 42.3% in 2013. Inflation was mainly caused by a law on subsidy degrading, implemented by the former government under president Mahmoud Ahmadinejad in 2010. The national currency (Iranian Rial) has lost much of its value since sanctions were imposed by the international community. Between March 2012 and March 2013, it is estimated that the Rial lost 80% of its value in comparison to the US dollar. Additionally, the catalytic role of former Iranian President Ahmadinejad’s confrontational foreign policy pushed Iran into deeper isolation and also impacted on economic performance. With the presidential elections on 14th June 2013 and the subsequent victory of president Rouhani 2013, Iran now seems well positioned to engage in fruitful cooperation with international partners.

With a few Iran’s overall economy in in comparison with other countries in the region, Iran is the second largest economy in terms of GDP in the MENA region after Saudi Arabia according to the World Bank. In 2012, this amounted is to USD 548.6bn, yet in 2013 the projected declined to USD 388.5bn was recorded. Regarding Iran’s GDP performance, the IMF has forecasted total USD 408.2bn for 2014 and USD 428.4bn for 2015, as well as continued increase up to USD 433.6bn in 2018.In terms of growth, which stood at 3.0% in 2011, Iran experience a negative GDP real growth rate of 1.9% in 2012. In light of the latest developments, however, this rate is expected to increase to 1.3% in 2014. In 2012, the share of GDP from the service sector amounted to 44%, within this sector – including manufacturing – contributing 37.6%, and agriculture 11.3%.

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