Iran’s tourism sector, already struggling in recent years, is facing a severe crisis, particularly in the warm southern coastal regions typically bustling with visitors during the winter months.
A confluence of economic pressures, regional tensions, and recent unrest has led to widespread cancellations and a dramatic decline in bookings, leaving many accommodation providers and tourism businesses on the brink.
The peak season for southern Iran’s tourism, typically running from November through February, has seen significantly reduced demand this year, according to Shayan Bahram, a prominent figure in the eco-tourism sector in Bushehr.
“The demand this year is far below expectations, creating significant problems for us and our colleagues,” Bahram said. He added that the current situation is even worse than during the COVID-19 pandemic.
Bahram explained that all bookings for his establishment and those of his peers have been cancelled, not only by tour operators but also individual and family travelers. Many businesses, having invested in upgrades and new equipment using pre-payments, are now forced to refund these sums, creating a significant financial burden.
“This has created a major financial problem, making it almost impossible for many of us to pay our debts.”
Bahram highlighted the unique vulnerability of the tourism sector, noting that it is disproportionately affected by crises compared to other industries.
“Unlike goods that can be stored and sold later, tourism services have no shelf life; if they aren’t consumed today, they lose their value.”
Besides, he noted, tourism is often a secondary priority for individuals after essential needs.
Small-scale eco-tourism operations, often family-run and vital for local employment and community vitality, are particularly at risk. These businesses, while playing a crucial role in cultural and social activities, often receive limited support, according to Bahram.
Further Strain
Iran’s tourism sector has been in decline for several years, but the situation was further complicated in 2025 by a 12-day conflict with Israel in June.
While the end of the conflict initially raised hopes for a rebound, conditions deteriorated again in early 2026. Economic pressures built throughout 2025, culminating in public protests at the end of the year that later escalated into violence and resulted in casualties.
Iranian authorities reported the involvement of foreign-backed forces and terrorist groups and implemented a nationwide internet shutdown to maintain security. This ongoing disruption has compounded the existing difficulties for the already struggling tourism sector.
Besides, the lingering emotional impact of the tragic events in January, coupled with concerns about renewed military conflict, has dampened people’s enthusiasm for travel, effectively freezing both inbound and domestic tourism.
Niloufar Hosseini, a specialist in eco-tourism, said that many eco-lodges are being forced to sell their properties due to a lack of income and near-zero profitability.
“Unfortunately, even finding buyers is difficult, as no one is willing to invest in tourism facilities at this time.”
Previously focused on attracting international tourists, these establishments now rely solely on domestic tourism, which is also facing significant challenges, she said. Despite efforts to sustain operations with a limited number of domestic visitors, recurring events have placed them in a precarious situation.
“The cancellation of trips and empty accommodations during this crucial time have extinguished any remaining hope for improvement.”
The consequences are particularly severe for family-run businesses in rural and small towns, which could have played a vital role in boosting tourism, selling local handicrafts, and supporting the local economy. The closure or sale of these accommodations disrupts the entire chain of handicraft sales and has far-reaching secondary effects on local economies, according to Hosseini.
