Iran's place in the world economy, what to expect if sanctions are lifted?

Iran has a rich history and significant potential. The country has some of the largest oil and gas reserves in the world, making it a key player in the energy market. However, Iran's economic development has been significantly hampered by external factors in recent decades, especially economic sanctions from the West. Despite this, the Iranian economy has remained resilient thanks to its domestic market and strategic partnerships.

Iran's GDP is estimated at approximately $400 billion, and the country's population exceeds 85 million people, which provides a strong consumer base. The main sectors of the economy are oil and gas, automotive, agriculture, and textiles. It is important to note that Iran's economy faces a number of challenges: inflation, high unemployment, and limited access to international financial systems. However, the country is actively developing domestic production chains and modernizing its infrastructure.

Iran's Place in the Modern World Economy

Iran's place in the modern world economy is determined by its geographic location, natural resources, and diplomatic ties. Situated at the crossroads of Eurasia, Iran plays an important role in the transit of goods between the Middle East, Central Asia, and Europe. Important transport corridors such as the North-South and the Silk Road pass through the country.

A key element of Iran's role in the global economy is its participation in the energy balance. Iran is among the leaders in oil and gas reserves, making it an important supplier of energy resources. However, due to economic sanctions, Iran was forced to curtail many oil field development projects and limit exports. This, in turn, affected world oil prices and the stability of the regional market.

At the same time, Iran is actively developing ties with countries such as China, India, Turkey and Russia. These partners have become the main trade channels for the Iranian economy under restrictions. Thus, although Iran's role in the global economy has been temporarily suppressed, it continues to be an important regional actor.

How does Iran circumvent economic sanctions?

Circumventing Iran's economic sanctions has become a necessity for the survival of the national economy. Under pressure from international restrictions imposed by the US and the EU, Iran has developed a whole system of mechanisms to maintain trade and financial ties.

One of the key methods has been the development of parallel financial systems, such as the SWIFT-like platform within the SCO (Shanghai Cooperation Organization) and BRICS. Iran also actively uses barter transactions, especially in oil trade, to minimize the use of the dollar and the euro. For example, oil can be exchanged for goods or services directly, bypassing banking transactions.

Another important area was the development of digital currencies and cryptocurrencies. Iran was one of the first countries where the state officially legalized cryptocurrency mining as a way to circumvent economic sanctions. In addition, Iran has expanded cooperation with banks in partner countries, creating alternative payment systems.

It is also worth noting that Iran is increasing the volume of illegal exports through third countries, using complex transit and cargo re-registration schemes. Such methods allow maintaining export revenues even under severe restrictions.

How will the global economy change after sanctions are lifted from Iran?

The lifting of economic sanctions from Iran could be an important event for the global economy. Firstly, opening Iran's access to global financial systems will allow the country to significantly increase oil and gas exports. This could lead to lower energy prices, especially if Iran starts to actively compete with other OPEC+ members.

Secondly, the revival of the Iranian economy will open up new opportunities for international business. Companies from Europe, Asia and other regions will be able to return to one of the largest economies in the Middle East. This is especially true for the automobile, aviation and construction industries, which previously had good positions in the Iranian market.

Thirdly, the lifting of sanctions could lead to increased regional economic integration. Iran could become a key participant in projects such as the Silk Road Economic Belt proposed by China, as well as strengthen ties with its neighbors in the Economic Cooperation Organization (ECO).

Finally, it is important to understand that Iran's return to the global economy will have an impact on the geopolitical balance. Tehran's growing economic power could change the balance of power in the region and affect relations with such powers as the United States, Israel, and Saudi Arabia.

Conclusion

The Iranian economy, despite years of pressure and economic sanctions, remains viable and competitive. Its potential has not yet been fully realized, but today we can already say that the lifting of restrictions will be an important step not only for the country itself, but for the entire global economy. Iran's role in the global economy can increase significantly if conditions are created for open and fair cooperation.