Iran's economy experienced one of its most severe economic retreats in Spring 1405 with a 10.1% drop in GDP. This sharp decline is primarily due to a 26.4% reduction in oil and gas production. Excluding oil, the country's economy has contracted by 4.6%. However, a more significant change this season is the 35.7% decrease in exports of goods and services, indicating the severity of the recession in the country's foreign trade.
Recession in Industrial and Non-Oil Sectors
The decline in exports, as one of the components of final demand in the economy, has fallen by 35.7% while GDP at market prices has also decreased by 10.8%. Consequently, the share of exports of goods and services from GDP has dropped from 26% in Spring 1404 to 18.7% in Spring 1405. In contrast, the share of imports has changed slightly, decreasing from 11.6% to 11.1%.
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The fall in exports has occurred particularly as domestic production and trade also face serious challenges. According to Alireza Kalahi Samadi, a member of the Iranian Chamber of Commerce, the decline in people's purchasing power and inability to meet demand has put significant pressure on producers. This situation is especially evident in the industrial and non-oil sectors.
Factors Affecting Foreign Trade
Mousa Ahmadzadeh, Vice President of the Macroeconomics Commission of the Iranian Chamber of Commerce, pointed to abnormal economic factors, increased uncertainties, and currency fluctuations in analyzing the country's economic conditions. These issues can impact economic activities and ultimately lead to a decrease in exports. Additionally, logistical problems and rising transportation costs are other serious obstacles to exports.
Studies indicate that the industry has recorded negative growth for the second consecutive quarter, with the value added in the industry in Spring 1405 down by 2.5% compared to the previous spring. This decline follows the weak performance of the industry in 1404. Given these conditions, it seems that the limited growth in agriculture has not been able to offset the heavy decline in other sectors.
Overall, the published statistics indicate a weakening of foreign trade growth in the past two years, especially in the export sector. Therefore, it can be said that the country's economic conditions require serious attention and planning to improve the current situation.
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