9 Key Steps for Iran’s Economy

Nine Key Steps for Iran’s Economy

Year 1404 (2025-2026) is both highly important and a turning point of great consequence. It marks the target year for the realization of the 20-Year Vision Plan, designed to elevate Iran to the leading position in the region. Recent events have made it a critical juncture to reassess administrative and economic governance strategies.

The hope embodied in the vision for 1404 was anchored in policies and programs that aimed to make Iran the region’s top country. The current circumstances now demand bold and decisive decisions in economic and administrative management. While 1404 has been named the "Year of Investment for Production," it is currently operating under a medium-term program that lacks a long-term, strategic overarching plan.

So far, successive governments have failed to create the stability required as a foundation for investment, production, and development. At times, counterproductive and anti-development interventions have occurred. The private, productive, and entrepreneurial sectors have not been allowed fair participation; prices have been dictated; proper foreign investment has been absent; and many misguided actions have led to energy shortages, wasteful consumption, and the inefficient use of essential resources like fuel, food, water, and soil.

From now on, the government’s responsibilities become more complex and urgent, demanding greater rationality. The time for inefficiency is over. Therefore:

1. Redefine Government’s Role

The government must focus on creating enabling environments, strategic oversight, regulation, and — most importantly — avoiding unnecessary interference in administrative and economic activities.

2. Trust Real Private Sector

Recent events and the wise reaction of Iranian elites show that even critics of the status quo unite when the country’s sovereignty is threatened. So why not extend this trust to genuine private, entrepreneurial, and productive sectors that can lower costs, enhance efficiency, and support development?

3. Strategic Exclusivity

Government should maintain exclusive responsibility for designing and implementing macroeconomic strategies, while legal and judicial institutions should focus on their core mandates.

4. Curtail Quasi-State Competitors

Organizations that are "non-governmental" in name but operate like the state and benefit from rent-seeking ties to power centers have shown poor performance in productive economic roles. They should not compete with either the state or genuine private enterprises and must transfer economic activities to real entrepreneurs.

5. Economic Stability is Essential

Economic stability is now oxygen for entrepreneurs and economic agents. The time when "economic stability" was just a slogan has passed. The elected government must utilize all tools — administrative, cultural, legal, foreign policy, and even defense — to foster stability, hope, and the capacity for strategic private-sector planning.

6. Infrastructure Needs Investment

Development in essential sectors — energy, oil, gas, transport, housing, communications, industry, agriculture, water, and the environment — is not possible without foreign investment. Motivating both foreign and domestic investors, and designing modern financing instruments, is the government's responsibility.

7. Tackle Budget Deficit and Reform Subsidies

Chronic inflation, economic instability, and societal despair are closely tied to budget deficits, which stem from inefficient public spending. Budget lines that absorb funds without creating value must be eliminated. The subsidy system must be overhauled — today’s implicit and explicit subsidies are neither targeted nor effective.

Handing out cash or currency without a medium-term reform goal neither reduces poverty nor ensures satisfaction or stability. The government must create transparent mechanisms to define, classify, and deliver subsidies effectively.

8. Reverse the Brain Drain

Human capital is a key production factor. In recent years, the emigration of high-skilled individuals has surged. Through strategic reforms, we can both stop and reverse this trend. Simultaneously, the status of illegal immigrants — especially those who have arrived in recent years — must be addressed to ensure public safety and order.

9. Adjust Price Setting to Economic Reality

For goods that must be price-regulated by the government, the real cost of production should be acknowledged. Unrealistically low prices aimed at achieving social objectives create distortions and inefficiencies in supply and demand. The long-standing goal of separating economic and social policy objectives in pricing needs real action, not just words.

Conclusion

There is no doubt that the recent events have ushered in a new era for the nation. With these new conditions in mind, the government must now rethink and replan its course of action accordingly.