EghtesadOnline: Tehran Province attracted $1.2 billion of foreign investments in the form of 27 contracts during the last fiscal year (ended March 20, 2021), according to Farzaneh Dehnadi, the head of Economic and Financial Affairs Directorate of Tehran Province.
“The province ranked first in terms of ‘attracting foreign investment’ and ‘the number of approved foreign investment projects’ in the country during the period,” she was quoted as saying by IRNA.
According to Vaqef Behrouzi, the deputy head of the directorate, Tehran Province accounts for a quarter of Iran’s overall gross domestic products, excluding oil production.
He noted that taxation is a major source of revenue for Tehran, adding that the province alone accounts for more than half of all tax revenues earned by the country at the provincial level.
The Economist Intelligence Unit’s latest Cost of Living report comparing the cost of living in 133 cities shows Tehran ranks 106th among the most expensive cities in the world.
The ranking has climbed 14 places, meaning the cost of living has increased in the Iranian capital compared to other cities under review.
Latest data show the value of Tehran’s output stood at 7,400 trillion rials ($30 billion at current exchange rate) in the fiscal 2020-21.
Real estate was the most productive economic sector in Tehran, accounting for one-fifth of the province’s GDP.
The industrial sector accounted for 15.1% of Tehran’s total production.
According to a report by Persian-language daily Donya-e-Eqtesad, citing the Statistical Center of Iran, Khuzestan was the second biggest economy among Iranian provinces during the period under review as it made up 14.8% of Iran's GDP, despite a 1.6% decrease it registered compared with the year before.
The decline in oil output due to the imposition of sanctions is to blame for the downturn in Khuzestan’s GDP. Sixty-eight percent of the province’s GDP came from the mining sector, though.
Tehran and Khuzestan constituted more than one-third of Iran's production in the fiscal 2020-21.
Bushehr, Isfahan and Khorasan Razavi ranked third to and fifth largest economies of the country.
Tehran, Khuzestan, Bushehr, Isfahan, Khorasan Razavi, Fars, East Azarbaijan, Mazandaran, Alborz and Kerman provinces accounted for more than 70% of Iran’s total GDP in the year ending March 2021.
As the biggest economy, Tehran’s share in GDP is 50 times bigger than South Khorasan's, Iran’s smallest economy.
Notably, in the services sector, Tehran accounted for 33.41% of GDP, the Statistical center of Iran reported.
The United Nations Conference on Trade and Development (UNCTAD) recently released a new report saying foreign direct investment into Iran declined by more than 10% in 2020 compared to the year before.
Based on data published in the World Investment Report 2021, the UN agency put Iran’s FDI inflow at $1.34 billion in 2020, which was down 11% compared to $1.508 billion in 2019.
UNCTAD, which was established in 1964 as a permanent intergovernmental body and as part of the UN secretariat dealing with trade, investment and development issues, also records and discloses information on outward FDI flow.
FDI is an investment made by a firm or individual in one country into business interests located in another country in the form of a controlling ownership.
Iran had seen FDI inflows of $3.37 billion and $5.01 billion in 2016 and 2017 after the landmark 2015 nuclear deal.
The nuclear agreement opened the way for a growing number of foreign companies flocking to the Iranian market untapped after years of pent-up demand as a result of years of international sanctions related to its nuclear energy program.
However, the flow fell to $2.37 billion in 2018, mostly under the influence of the previous US administration's unilateral withdrawal from the nuclear agreement.
The Covid-19 crisis has caused a severe fall in global foreign direct investment, with investment flows dropping by a third – from $1.5 trillion in 2019 to $1 trillion in 2020, according to the new UNCTAD report.
The report found that the coronavirus pandemic rolled back progress made in ensuring that the least developed countries and those with weaker economies have access to foreign investments.
The study also shows that the drop in FDI was the severest for developed economies, where it fell by 58%. Flows to Europe fell by a whopping 80% as economies hunkered down by coronavirus restrictions and lockdowns. North America saw a decline of 42%.
While FDI in developing economies dropped by a moderate 8% due to resilient flows in Asia – inflows in China actually increased by 6% to $149 billion.
Investments in infrastructure projects in developing countries were hit particularly hard.