Economy of Iran

The economy of Iran was one of the most advanced in the Middle East till the Islamic revolution of 1979 when the pace of growth had slowed down considerably. In addition to that, the Iran-Iraq war and economic mismanagement further crippled the economic growth of Iran. There has been a steady improvement in the economy of Iran over the past two decades. Due to the high world oil prices the export revenues had increased, which helped to check the nation's large foreign debt. However, the economy of Iran continues to be encumbered by high unemployment, inflation, expensive subsidies, corruption, and a bloated and inefficient public sector. The percentage of the country's wealth devoted to the development of weapons of mass destruction continues to be a controversial issue with leading nations of the west.

Today Iran is ranked 150th among the world's freest economies, which scores well in only one of the 10 factors measured, which is fiscal freedom. The majority of the economic activities in Iran are dealt by the state.

Economic sectors in Iran

The economy of Iran is characterized by an over dependence on the oil sector, and the Government is making attempts to expand by investing revenues in other sectors as well. The other areas where the government is looking to diversify are aerospace industries, car manufacturing, consumer electronics, nuclear technology, and petrochemicals. The country also has an immense potential for development in sectors like tourism, mining, information and communication technology (ICT).

Private sector businesses in Iran generally include small-scale workshops, farming, and services.

Oil and Gas

Oil and gas is the primary economic sector in Iran and holds approximately 10% of the oil reserves in the world. In addition, Iran is OPEC's second largest producer and also boasts of having the world's second largest oil and gas reserves. Iran promises to grow in the near future in areas of drilling, exploration, refining and training.

The Iranian government has been reconstructing its oil production and export facilities since the conclusion of Iran-Iraq war in1988.

In an important development in 1995, the Iranian government created new opportunities for investment in the oil sector by foreign companies.

Mining

Besides oil and gas, Iran is also rich in its mineral deposits having the largest reserves of Zinc and second largest copper reserves in the world. Other important mineral reserves include lead, iron, uranium, chromites, manganese, gold and coal. In spite of its rich mineral deposits, Iran's mining industry remains underdeveloped. Nevertheless, the Iranian government is giving top priority to the development of the mineral industry and is also encouraging foreign participation.

Telecommunications

As one of the fastest growing telecommunications markets in the Middle East, Iran aims to become number one in Middle Eastern market. The country has the biggest telecommunication network in the region.

The government of Iran has lately introduced a number of privatization measures and is also encouraging private investments in this sector.

This article provides an outline of the economy of Iran. For more on Iran, visit- 123independenceday.com