What does tourism development promise to Iran?

What does tourism development promise to Iran?

Baku, Azerbaijan, Oct. 27


The sanctions imposed on Iran over its nuclear program in the recent years, in particular, prohibiting the sale of oil and oil products, forced Tehran to take certain actions to eliminate the dependence of the economy on oil revenues.

The actions are taken to reduce Iran's economic dependence on oil revenues and to increase non-oil exports as part of the "Economy of resistance" strategy to neutralize the effect of sanctions.

Iran has been striving to eliminate this dependence for years. The country is involved in broad activity to increase the production and export volumes. Lately, Iran has taken significant action to develop tourism as part of measures to reduce the economy's dependence on oil revenues.

Export and production condition

The neighboring countries and Asian countries play the main role in Iran's foreign trade. Thus, the main direction of Iran's foreign trade is Asian countries. The share of European countries there is insignificant.

According to the customs statistics, Iran mainly exports its goods to China, UAE, Afghanistan, Iraq and India. If the balance of Iran's foreign trade turnover with China, India and the UAE is negative, the country's trade turnover with Iraq and Afghanistan has a surplus.

In the first half of the current Iranian calendar year (started March 21), Iran exported products worth $23.199 billion, which is 2 percent more than the same period last year. In the country's total export 57 percent accounted for the oil, gas and oil products, and 43 percent for the production of the non-oil sector.

If Iran export is conditionally divided into 10 parts, nine of them will account for the production of the oil, mining and petrochemical fields.

Most part of the non-oil export of Iran amounts to pistachios. Iran also exports industrial products to Afghanistan, Iraq and the countries of the CIS, but their share in total export is less significant than that of the above categories.

A more careful analysis of the data from Iran's customs administration, it can be concluded that 70 percent of Iran's export accounts for countries of the region (the five neighboring countries), and 30 percent for other states.

Tourism and its impact on the economy of Iran

Tourism sphere has a large weight in the economy of Iran and is considered the most profitable one. Tourism directly or indirectly influences the cultural and economic activity in the country. Undoubtedly, tourism is the most profitable area of the economy of Iran, and at the same time, this area contributes to the elimination of unemployment.

Iran ranks eighth in the world for its cultural and tourist attractions. Around five million tourists visited Iran in the last Iranian calendar year with half of them making pilgrimage to the holy places (Mashhad, Qom). Thus, the major part of tourists come to Iran from Asian and neighboring countries, while the share of European countries in the total number of tourists visiting Iran is small.

Head of Iran's Cultural Heritage, Handicrafts and Tourism Organization (ICHHTO) Massoud Soltanifar said that the sphere of tourism brings profit and allows to create new jobs in the country. He added that Iran's revenues from the tourism sphere stood at $6 billion in the last Iranian calendar year.

Soltanifar said Iran plans to increase the mentioned figure by 25 percent this year.

Currently, the country implements 900 projects worth of $7 billion in the sphere of tourism and 40 percent of the work under these projects has already been completed, according to Iranian media outlets.

The Iranian government has taken various measures in recent years to reduce inflation, speed up the economic development and improve the living standards of the population.

The government also aims to create economic stability in Iran by organizing the travel of tourists from European countries to various regions of the country.

Iran's government has a particular interest in the visits of European tourists. One vivid evidence of that is the coming of a luxury train via the Budapest-Tehran route, or the South Korea-Bandar Abbas sea cruise.

It should be noted that the Budapest-Tehran VIP-train, which has all the conditions for passengers, is running from Budapest (Hungary) to Romania and arrives in Iran through Bulgaria and Turkey.

Currently, Iran has 1,100 hotels, 130 of which are four- and five-star hotels. In 2025, the number of hotels in Iran will be increased threefold. The experts said that by 2025 the number of tourists visiting Iran will grow from the current 5 million to 20 million people.

Developing its tourism sector, Iran, which is in an international isolation due to its nuclear program, can break the entrenched negative stereotypes about itself.

This may also positively affect the settlement of the nuclear issue, the negotiations on which are currently deadlocked. Aside from that, tourism's development can contribute to the rapprochement of Iran with many countries and strengthening of political relations of the country.

Trend commentator, Temkin Jafarov

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