Iran's economic growth reached negative 10.1 percent in the first quarter of 1405; a figure that, according to data from the Statistical Center of Iran, indicates a severe decline in economic activity in the first season of the year. The decrease in oil production, drop in investment, reduction in exports, and negative growth in the industrial, mining, construction, and services sectors are the main factors behind this decline.
Gross Domestic Product Status
Iran's Gross Domestic Product also decreased from about 24255 trillion rials in the first quarter of 1404 to 21795 trillion rials in the same period this year. Thus, the size of the economy has shrunk by more than 10 percent compared to last spring. The severe decline in the oil and gas sector has been one of the most important factors contributing to this negative growth.
Analysis of Different Economic Sectors
According to calculations from the Statistical Center, the growth of Gross Domestic Product excluding oil was negative 4.6 percent; meaning the oil sector has a significant share in the overall economic decline. The extraction of oil and natural gas recorded the highest decline among economic groups with a negative growth of 26.4 percent.
In the industrial and mining sector, growth with oil included was negative 14.7 percent and without oil was negative 5.2 percent. In the subgroups of this sector, oil and gas growth was negative 26.4 percent, mining negative 1.9 percent, industry negative 2.5 percent, natural gas distribution negative 21.3 percent, water and electricity supply negative 5.4 percent, and construction negative 6.4 percent.
Agriculture was the only main sector of Iran's economy that experienced positive growth this spring. The growth of this sector was reported at 2.3 percent in the first quarter of the year. In contrast, the industrial and mining group faced negative growth of 14.7 percent and services faced negative growth of 4.8 percent.
Gross fixed capital formation also experienced intensified negative growth this spring. This indicator, which provides a picture of investment trends and productive capacity in the economy, has also mostly faced negative growth in recent years and reached negative 8.4 percent in spring 1405.
At the same time, exports of goods and services have also seen a significant decline. The growth of exports this spring was reported at negative 35.7 percent, while this figure was negative 8.8 percent in spring 1404. According to this data, the country's exports have decreased by about 45 percent from spring 1403 to spring 1405.
All these data indicate that Iran's economy is facing one of its most severe periods of economic activity decline in the first season of 1405, alongside a sharp decrease in oil production, a drop in investment, a reduction in exports, and contraction in various production and service sectors.
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