Panorama econòmic

Economic indicators

Iran's economy is characterized by its reliance on hydrocarbon resources, a vibrant agricultural sector, and a diverse service industry. Additionally, the manufacturing and financial services sectors notably feature significant state involvement. External shocks, such as sanctions and commodity price fluctuations, led to a decade-long stagnation that concluded in 2019/20. However, in recent years, Iran's economy has begun to recover, buoyed by a resurgence in services after the pandemic, heightened activity in the oil sector, and adaptive policy measures. Economic resilience has been demonstrated in response to sanctions, including exchange rate adjustments that enhanced the competitiveness of domestically produced goods in international markets. According to IMF projections, Iran’s GDP grew 5.4% in 2023 thanks to a higher-than-expected increase in the country’s oil production. For 2024 and 2025, the IMF forecasts growth at 2.5% and 2%, respectively.

The decline in revenues as a result of US sanctions has prompted the government of Iran to satisfy its financing needs through extensive debt issuance and the sale of assets on the stock market. Elevated oil prices, driven by a global demand rebound and the Ukraine conflict, have boosted oil export revenues. However, the surge in commodity prices, particularly for food items, has substantially raised the import bill. This escalation added strain to government finances, especially considering that direct food price subsidies amounted to 5% of GDP even before the recent price surge. The current account balance is expected to sustain a surplus in the forecast period, bolstered by increased oil prices and non-oil exports. However, the surplus may be constrained by a more expensive import bill resulting from higher import prices. Despite the gradual rise in oil exports positively impacting the fiscal balance, the budget deficit is anticipated to persist above pre-sanctions levels, according to the World Bank. Meanwhile, public debt declined to 30.6% of GDP in 2023 (from 34.1% one year earlier) and is expected to follow a downward trend. Inflation stood above 45% in 2023 but should gradually decline amid lower food prices, resulting in a slight acceleration in household consumption.

Iran's unemployment rate reached 9.4% in 2023. The IMF estimates that the rate will remain relatively stable in 2024 (9.6%) and in 2025 (9.8%). The number of people no longer actively seeking work is increasing. Years of recession and high inflation have severely challenged household livelihoods and halted the poverty reduction trend. According to official figures released by the Interior Ministry, around 60% of Iranians live below the relative poverty line. According to a report published by ILNA in February 2023, one-third of the country’s population is now living in extreme poverty, after the number almost doubled in one year from 2020 to 2021. The country’s GDP per capita (PPP) was estimated at USD 18,261 in 2022 by the World Bank.

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