Economic Development Progress in

Iran
The history of Irans economic growth
It is a well-known fact that Irans economic growth was considerable before
the late 1970s. In those days they were primarily an agricultural society but
this has started to change in the 70s because of increased industrialization
and other economical advances. However the economic growth which has
been experience began to slow down during 1978 just before the revolution
which followed in 1979. After this revolution some drastic reforms followed
such as state control over the setting of prices and all other subsidies. There
was also a division of the country after the new Constitution has been
accepted which led to a division of the country into 3 sectors such as private,
state and cooperate and during this dispensation the majority of businesses
have become state owned property. Most parts of the industry had been
nationalized which included all Iranian banks and other organizations. Most
initiatives which were entered into by the government was controlled through
central planning which included five years socioeconomic plans which was
decided upon by Irans supreme leader, the president and the Majlis.

Long-term economic plans

After the revolution the primary objective of government was to ensure
economic independence as well as comprehensive employment for everyone.
The goal was to provide a comfortable standard of living for all Iranian
citizens. Unfortunately by the time that the end of the 20 th century was
reached the country was faced with increasing economic problems. This
problem was further escalated by the very high population growth which took
place in the space of only 20 years. During this time the Iranian population
has doubled and the average citizens were increasingly younger people.
Traditionally Iranians have been primarily farmers but nevertheless
agricultural production has been on the decrease since the 1960s. This has
led to a situation where Iran has been forced to import large amounts of its
food sources. Because of the increasing difficulties which were experienced in
rural areas many people started to move to metropolitan areas.

The burden brought about by the war

The extended conflict which existed between Iraq and Iran over a period of
eight years has led to a loss of life for over 300,000 Iranians while a further
500,000 Iranian soldiers had been severely injured. This has placed a very
heavy burden on the Iranian economy and that has been calculated that the
total cost of that war was at least US$500 billion. This necessitated a
rebuilding process and some of the areas which needed special attention with
transportation, healthcare, communication, manufacturing and the energy
sectors. This included nuclear power facilities. There has been several
attempts since 2004 when the supreme leader of Iran has tried to implement
reforms that will lead to the total privatization of Iran but such attempts have
not been successful to date. This had resulted in a situation where Iran are
basically a command economy which are in a transition process towards
becoming a market economy. It is expected that more severe transformation
processes has to be implement before any real economic growth will become
possible.

Economic Development Progress in Iran

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