ECONOMY OF IRAN (research)

Factors affecting the economy of a country

1. Capital formation
2. Natural resources
3. Agriculture?
4. Foreign trade
5. Economic system?
6. GDP
7. Inflation?

Iran’s economy is characterized by its hydrocarbon, agricultural, and service sectors, as well as a
noticeable state presence in the manufacturing and financial services. Iran ranks second in the world
for natural gas reserves and fourth for proven crude oil reserves. While relatively diversified for an
oil exporting country, economic activity and government revenues still rely on oil revenues and have,
therefore, been volatile. (world bank org)

Iran’s economy, one of the Middle East’s most advanced before 1979, has been
undermined since then by mismanagement, international sanctions, and pervasive graft
under a repressive Islamic government dominated by Shiite religious authorities.
President Ebrahim Raisi, installed after rigged elections in June 2021, is a protégé of
Supreme Leader Ayatollah Ali Khamenei. Iran has the world’s second-largest reserves of
natural gas and fourth-largest reserves of crude oil. U.S. sanctions imposed after
Washington withdrew from the 2015 nuclear agreement in 2018 slashed Iran’s oil
exports and pushed the country into recession, but current talks could yield an
agreement that allows Tehran to expand oil exports, attract greater foreign investment,
and increase trade.

Iran has three preferential trade agreements in force. The trade-weighted average tariff
rate is 12.9 percent. Iran is not a member of the World Trade Organization. The
intrusive state continues to hold back economic development, undermining trade and
investment flows. Government controls limit access to financing for businesses. State-
owned commercial banks and specialized financial institutions account for the majority
of banking-sector assets.

# Iran is not a member of the World Trade Organization.

Prior to the 1979 revolution, Iran had experienced great changes in terms of adopting western
viewpoints on women and religion. However, the western values were perceived as a threat to Iran’s
Islamic values and traditions by the religious establishment. As a result of the 1979 revolution, the
new Islamic Republic of Iran attempted to shelter the country from western values and ideas.
Nevertheless, western influence have continued to impact the Iranian business culture, since many
key financial leaders and businesspersons have remained in touch with the international community.
Iran also has a large diaspora in the US, Canada and Europe, which have remained in touch with
family members in Iran and thereby maintained the cultural link between Iran and the West. The
Iranian business culture is therefore a mix between traditional, Islamic inspired values and western
norms and customs.

The US sanctions.
The United States has since 1979 applied various economic, trade,
scientific and military sanctions against Iran. U.S. economic sanctions
are administered by the Office of Foreign Assets Control (OFAC), an
agency of the US Treasury Department. Currently, US sanctions
against Iran include an embargo on dealings with the country by the
U.S., and a ban on selling aircraft and repair parts to Iranian aviation
companies.[1]

The US has imposed sanctions against Iran in response to the Iranian

nuclear program and Iranian support for Hezbollah, Hamas, and
Palestine Islamic Jihad, that are considered terrorist organizations by
the US. Iranian support for the Shia militias in Iraq and the Houthis in
the Yemen civil war are also in contention.
JULY 6, 2022
Treasury Targets Iranian Oil and Petrochemical Trade Network
JUNE 16, 2022
Treasury Targets International Sanctions Evasion Network Supporting
Iranian Petrochemical Sales
JUNE 16, 2022
Targeting a Sanctions Evasion Network Supporting Iranian
Petrochemical Sales
MAY 25, 2022
Targeting an Oil Smuggling Network Supporting the IRGC-QF and
Hizballah
MAY 25, 2022
Treasury Targets Oil Smuggling Network Generating Hundreds of
Millions of Dollars for Qods Force and Hizballah
DECEMBER 7, 2021
Targeting Repression and Supporting Democracy
DECEMBER 7, 2021
Treasury Targets Repression and the Undermining of Democracy
OCTOBER 29, 2021
Designation of Six Targets Involved in Iran’s Destabilizing Unmanned
Aerial Vehicle Activities