Lack of confidence in Iran’s business environment will persist in the fiscal 2022-23 as the easing of Covid-19 restrictions and sanctions remains the only hope of economic players, the latest survey conducted by Business Watch, a website designed for improving the country’s business environment show.
In March 2022, a total of 1,098 questionnaires were analyzed by two university professors Ali Davoudi and Mehdi Saneie. The key findings of the survey, which focus on the biggest share of responses, are as follows:
Macroeconomic Risks
- Seventy-one percent of the respondents believe their purchasing power will decrease in 2022-23.
- Fifty-five percent said unemployment will increase.
- Forty-four percent said recession in the production sector will worsen.
- Thirty-seven percent said exports will improve.
- Forty-nine percent said economic recession in fiscal 2021-22 will persist in the current year.
- Fifty-three percent believe international sanctions against Iran will ease.
- Thirty-nine percent said economic growth will be negative.
- Seventy-one percent said inflation will increase.
- Thirty-nine percent believe the US dollar exchange rate will range between 260,000 rials and 300,000 rials.
- Sixty-one percent believe human capital flight will increase.
- Sixty-six percent believe capital flight will increase.
- Sixty percent believe the fight against corruption won’t amount to much.
- Forty-eight percent said a likely revival of the Joint Comprehensive Plan of Action (nuclear deal) will improve businesses to some extent.
- Fifty-one percent said support for entrepreneurs will be the same as in the previous year.
- Forty-four percent said financing by the banking system will be the same as in the previous year.
Risks Facing Industries
- Sixty-four percent said demand will decline as a result of inflation.
- Sixty-six percent of the respondents believe that customers’ priorities will change.
- Eighty percent believe that prices of raw materials and services will increase.
- Eighty-three percent said costs of business will increase as a result of the general rise in prices.
- Thirty-eight percent said imports of raw materials, equipment and parts will be the same as in the previous year.
- Forty-eight percent of respondents believe that the disruption in supply chain of raw materials and imports caused by the pandemic will decline.
- Forty-one percent believe that investment in productive sector will slide.
- Fifty-eight percent said the business outlook will remain unclear.
- Forty percent of the respondents believe that small enterprises and startups will become more active in the new year.
- Sixty-eight percent believe businesses will face shortage of skilled workforce.
- Forty-nine percent of the respondents believe that access to strategies to improve remote working will be the same as in the previous year.
- Forty-eight percent said employees’ motivation, performance and productivity will fall.
- Forty-five percent believe that welfare programs of human resources will decrease.
- Sixty-nine percent said the approval and enforcement of “protection bill”, which allows the Iranian government to control cyberspace and monitor all internet content, will have a negative effect on businesses.
- Eighty-one percent of the respondents believe that Covid-19 restrictions will decline in 2022-23.
