Samt Newspaper highlights systemic dysfunction in Iran’s economy amid deepening inflation, sanctions, and investment decline.
In a striking report on September 22, Samt Newspaper painted a grim picture of Iran’s economic trajectory, declaring that “all engines of economic growth” in the country have ground to a halt.
The daily emphasized that sustainable growth requires key conditions such as a healthy business environment, sound economic governance, access to technology, and reliable financing. Each of these, it argued, can be compared to an engine powering national growth. “The issue is that none of these engines are currently active,” the paper noted.
Unattainable Targets in the Seventh Development Plan
Iran’s Seventh Development Plan sets an ambitious target of 8 percent annual economic growth. However, Samt stressed that this goal is unattainable without fundamental reforms. The paper listed prerequisites including boosting domestic and foreign investment, improving productivity in the production sector, and restructuring the national budget. It further warned that unless the government addresses energy imbalances, banking system failures, and high policy risks, economic recovery is impossible.
Recent weeks have seen spiraling inflation, mounting pressure on industries, and a sharp rise in foreign exchange rates. These concerns have intensified with the reactivation of the UN sanctions “snapback” mechanism, raising the prospect of even harsher international restrictions.
Dire Forecasts and Scenarios
Earlier this month, the Iranian Chamber of Commerce published its own projections for the economy through 2025, offering optimistic, likely, and pessimistic scenarios. In the worst-case scenario, the exchange rate would soar to 165,000 tomans per dollar, inflation could reach 90 percent, and economic growth would remain negative across all projections.
Echoing these warnings, Samt cited economist Vahid Shaqaqi-Shahri, who described Iran’s growth engines as working in “reverse.” He stressed that even achieving zero growth would count as an achievement under current circumstances.
Housing, Oil, and Structural Weaknesses
Shaqaqi-Shahri pointed to the housing sector as a traditional driver of growth, but said it has fallen into “complete stagnation” due to political instability, reduced purchasing power, water shortages, land subsidence, and declining population growth.
The oil sector, long considered Iran’s economic backbone, is also underperforming. International sanctions and falling prices have prevented it from playing its historical role as a “growth driver.”
The International Monetary Fund earlier this year projected Iran’s growth for 2025 at nearly zero, with inflation expected to reach 43.3 percent.
Barriers to Growth
According to Shaqaqi-Shahri, Iran faces multiple structural obstacles, including:
- Weak productivity caused by dominance of quasi-state enterprises and a debilitated private sector
- An annual financing gap of roughly $200 billion needed to reach 8 percent growth
- Intensifying sanctions and heightened investment risk
“With the current trajectory, it is unlikely we will see growth above one percent this year,” he warned, adding that without reactivating the engines of growth, negative growth in 2026 and 2027 is entirely plausible.
