Iran currency growth ? Need suggestion from Economists

[Stryker1982]

Iran's currency will NOT stabilize until the day comes that Iran restores it's tourism industry and that will not happen until Iran starts to remove religious laws like Hejab by force, ban on alcoholic beverages, ban on nigh clubs, restriction on music concerts....

Tourism is hands down one of the most vital Industries most countries have and is the main source of foreign currency for most countries

Iran's tourism industry has a monetary deficit and that's cold hard cash leaving the country every year and as long as that persists Iran's currency will NEVER truly stabilize

If you wanna compare Iran's Oil economy to a Tourism economy best option is to compare Iran to Turkey

This is the trend of the Turkish currency over the last decade

View attachment 452411

and Trend of their GDP
View attachment 452434

VS Iran's oil economy that has gone nowhere but down because it's an Oil based economy that's government controlled and when oil prices double in the early 2000's the Iranian government prevented the currency value from going up with it and they prevented that from happening because they were using government banks to hand out high interest rates
But when Oil fell and banking sanctions hit Iran they had no choice but to devalue the currency because they didn't have the dollars to continue to pay all the cash owed to Iranians who had money inside banks and as a result a lot of people lost a lot of money and they could do that because Oil was the main source of foreign currency for Iran and they had more control over the value of the currency than the market and that is unhealthy!



Today Turkey using tourism has built an economy twice the size of Iran with about the same size population!
Their currency & GDP has had a continued upward trend over the past 2 decades and as long as they don't do something stupid like start a war that trend will likely continue
Where as Iran's GDP (nominal) today is the same as it was a decade ago and the countries GDP goes up and down based on Oil prices and Oil over the long term will continue to devalue due to demand because of alternative energy, electric cars, offshore drilling,....

So a devalued currency is not bad for Iran as long as you have a tourism industry to take advantage of it but if you wanna invest in Iranian currency your better off investing in Oil which isn't really advisable unless you know a war is coming

And until Iran address it's Tourism Industry by getting rid of religious nonsense the currency and economy will remain unstable! And today not a single economist in Iran has the guts to publicly address this issue which means the Iranian government is a long way off from addressing this issue!

Hejab by force is one of the dumbest laws i've ever seen. And whats dumber are the bisavad beshoors who think not wearing a hijab is prostitution. I guess their are billions of prostitute women on earth then. With this level of idiocy, no wonder Iran is going to end up like Syria in a few years. Either by internal war, or by the environmental crises (no water).

 

[Deidara]

you can buy currencies of countries that are gaining technological competitiveness at a rapid pace. increasing quality of their products will mean that their currencies will appreciate.

 

[Dinky]

Tourism only makes up less than 5% of Turkish GDP, Lira has also been partly devaluated intentionally to raise exports since economy is stalling for the moment.

how will you respond to this @VEVAK
Turkeys economy is double that of Iran and yet only 5% of Turkeys gdp comes from Tourism

 

[Hack-Hook]

How is Iran's Balance of Payments?

you find your answer here
https://www.cbi.ir/category/3393.aspx

 

[Homajon]

Turkey had a major economic growth, but it is built on the same foundations as the economies of the west: on debt!!!

https://www.ceicdata.com/en/indicator/turkey/external-debt--of-nominal-gdp
https://www.ceicdata.com/en/indicator/iran/external-debt--of-nominal-gdp

Turkey: 47% foreign debt
Iran: 2% foreign debt

And then there is also the public debt of the citizens:

http://www.theglobaleconomy.com/Turkey/household_debt_gdp/

https://www.nytimes.com/2014/02/28/...edit-card-debt-threatens-turkeys-economy.html

https://news.sol.org.tr/54-million-turkish-citizens-live-debt-173237


When it comes public debt, the "moderate" Rouhani also wanted to follow the "successful" western model, and curiously enough in 2015, the year of the JCPOA when Iran was supposed to economically benefit, Irans public debt skyrocketed:

https://www.statista.com/statistics/294544/iran-national-debt-in-relation-to-gross-domestic-product/

(Fortunately in absolute numbers, it is still relatively low, and it also again decreased, but it once again shows what a mindset Rouhani has )


So concluding, Iran should not follow the western model and build its economy on debt, so that future generations don't have to pay the price for the present generations comfort.

 

[VEVAK]

how will you respond to this @VEVAK
Turkeys economy is double that of Iran and yet only 5% of Turkeys gdp comes from Tourism

I respond to it by saying only 5% or over $42 Billion USD is the direct impact of Tourism NOT the indirect impact of Tourism which is the MOST important part and together they are at least 15% of the Turkish GDP and because that's a lot of foreign currency coming to Turkey in the masses it effects all Turkish citizens which means they are wealthier for it and can better invest their money at home

Tourism has 2 sides one is it's direct benefits that is money coming from hotels, resorts, airliners,....

And indirect benefits that is money being spent by over 20 million tourists every year to come to Turkey and buying Turkish products and that's the main benefit the Turks have taken advantage of

And FYI $42 Billion in foreign currency is 10% of Iran's GDP(nominal) that's a lot of money!

Also, Turkey has various industries that Iran has banned it's self from Night Clubs, Alcoholic Beverages, Music Industry, TV, Radio,..... which by the most part are the very same things that has prevented Iran from having a healthy Tourism industry

Here is the list of the top 7 Tourist countries in world

Which is basically the list of the healthiest economies in the world

Japan, S.Korea, India, Canada,... All of them bring in between $15 Billion to $30 Billion USD a year in international receipts

Iran can't even bring in $2Billon

So yea MORONS that Support Hejab by force are the very same MORONs that have destroyed Iran's Economy

 

[VEVAK]

you can buy currencies of countries that are gaining technological competitiveness at a rapid pace. increasing quality of their products will mean that their currencies will appreciate.

Any economy that purposely cuts chunks out of it's own economy is NEVER going to be healthy!

All the top economies in the world are also at the same time the top Tourism countries of the world

You can't cut out one of the main sources of international currency from your economy and expect your currency to be stable
And when a country like Iran doesn't have at least 15 Million tourist coming in bringing in their countries currency to buy your currency then you have a problem

Today about 80% of Iran's exports are Oil, Gas & Petrochemical

And there are a lot of different factors that effect your currency not just high tech products

Kuwait, Bahrain, Oman & Jordan have high value currencies and none of them produce high tech products! Japan, China & South Korea produce high tech products in high demand world wide with economies that rank among the top 10 but NONE of their currencies rank among the top 10

Your currency value doesn't really mean anything it's the stability of your currency that's important for your economy.

Most tourists don't come for alcohol, night clubs, music concerts nor do they care about Hijab.

ONLY an idiot would believe that!!!!

And clearly you haven't gone on vacation to a lot of countries with international tourists

About 3-5 Million Russians visit Turkey every year! Why do you think they don't come to Iran?

People don't take vacation to places where there is a Dress Code where they'll have NONTHING to do at night and can't even have a win with their meal!

People don't visit other countries Beaches if they can't enjoy it!

Vast majority of families that visit other countries ski resorts have at least 1 family member who would like to have a drink to warm up! If they are a group of young people then most of them want to drink and clearly you haven't been to a lot of ski resorts

As for Iran's historic sites well there are many countries with historic sites all across the world and people will always choose a country without a dress code over one with!

Most clubs in China are filled with foreigners and yes NO ONE goes to china for their clubs BUT they have clubs & most international tourists do visit them ​

Tourism only makes up less than 5% of Turkish GDP, Lira has also been partly devaluated intentionally to raise exports since economy is stalling for the moment.

Turkish Lira has been stabile it low devaluation over the dollar over time is strategic to bring in international currency from exports and Tourism

And 5% is a lot! That's $40 Billion in international currency being distributed amongst the people!
Last year Iran's total exports were ~$80 Billion and almost 80% of which was from Oil, Gas & Petrochemicals all of which goes directly to the government!

5% of $850 Billion = 10% of Iran's GDP and that is big chunk with indirect benefits that effects the masses

Today my $40 Turkish knockoff diesel Jeans are of a better quality and far outlast my $200 real US purchased diesels! I have Serbian friends that travel and get on trains to go to Turkey just to buy their clothing

So trust me the indirect benefits are far greater than that 5%

My friends in Iran visit Turkey on a YEARLY bases they work in Iran save up and go to Turkey to spend it!

 

[xenon54 out]

Turkish Lira has been stabile it low devaluation over the dollar over time is strategic to bring in international currency from exports and Tourism

And 5% is a lot! That's $40 Billion in international currency being distributed amongst the people!
Last year Iran's total exports were ~$80 Billion and almost 80% of which was from Oil, Gas & Petrochemicals all of which goes directly to the government!

5% of $850 Billion = 10% of Iran's GDP and that is big chunk with indirect benefits that effects the masses

Today my $40 Turkish knockoff diesel Jeans are of a better quality and far outlast my $200 real US purchased diesels! I have Serbian friends that travel and get on trains to go to Turkey just to buy their clothing

So trust me the indirect benefits are far greater than that 5%

My friends in Iran visit Turkey on a YEARLY bases they work in Iran save up and go to Turkey to spend it!

5% hardly makes it Tourism economy though.
Its some extra money with a heavy prize, mass tourism also has a lot negative effects such as pollution on the most beautyful places.
Turkey gets 30-40 million tourists per year thats half of countries population but only contributes 40 billion or something, most tourists stay in all inclusive resorts and the economy gets only peanuts, im not really proud of Turkish tourism sector, its certainly not something you guys should aim for.
Without Istanbul and other cultural places the tourism would have zero value for Turkey.

 

[VEVAK]

Why are you guys painting such a gloomy picture of Iran and its currency ? I don't think it's that bad

NOT THAT BAD really!

This is NOT a stable currency! Having your currency get devalued by almost 400% is NOT stable!

Basically if you were a middle class Iranian that placed ~$100,000 USD worth of Iranian currency in a 5 year CD in Iran's central bank in 2010 today that money is worth ~$30,000 USD

So basically your entire family savings went from being able to afford a very small apartment in Tehran to barely being able to afford a new Mazda 3 in Iran!

So yea that's BAD!

 

[VEVAK]

5% hardly makes it Tourism economy though.
Its some extra money with a heavy prize, mass tourism also has a lot negative effects such as pollution on the most beautyful places.
Turkey gets 30-40 million tourists per year thats half of countries population but only contributes 40 billion or something, most tourists stay in all inclusive resorts and the economy gets only peanuts, im not really proud of Turkish tourism sector, its certainly not something you guys should aim for.
Without Istanbul and other cultural places the tourism would have zero value for Turkey.

Your mistaken! When you have 30 Million people who worked and saved up money in other countries that choose to come and spend their hard earned money in your country you should be grateful!

That's 30 Million people contributing to the development of Turkey's infrastructure, that's free international advertising to Million of foreigners for various Turkish companies, that's 30 Million people that pay fees at the border, that's 30 Million extra consumers of Turkish goods & services and that's millions of people that contribute to the development of your airlines & trains..... And between them you get millions of potential business opportunities for the export of Turkish goods.... And the 30 Million that come have saved money to spend in Turkey they are NOT 30 million homeless people or free loaders they 30 million that contribute to your economy so complaining about the trash they leave behind is petty!

In fact in the list of the top 10 largest GDP's it's only Brazil which is a vast and fertile country with a population of 200 million people whos exports are more than triple that of Iran's that doesn't have at least 10 million Tourist visiting every year
Both Iran and Brazil have a Tourism problems and the Brazilian government is working over time to fix it!

and except for Brazil that has it's own problems there isn't a single successful economy in the world (With a population of 20mill people) that doesn't have at the very least 15 Million Tourists coming every year!​

But even with the 8th largest economy in the world & exports 3 times that of Iran & a service industry that contributes to over half of their GDP at the end of the day due to a lack of Tourism has resulted in a per capita purchasing power lower than Iran and Turkey which means the Brazilian people aren't doing as well as they should be and poverty if far greater than it should be

So clearly you fail to appreciate and comprehend the indirect benefits those 30 million have had on Turkey's Economy

So there IS NO OTHER WAY!

 

[xenon54 out]

Your mistaken! When you have 30 Million people who worked and saved up money in other countries that choose to come and spend their hard earned money in your country you should be grateful!

That's 30 Million people contributing to the development of Turkey's infrastructure, that's free international advertising to Million of foreigners for various Turkish companies, that's 30 Million people that pay fees at the border, that's 30 Million extra consumers of Turkish goods & services and that's millions of people that contribute to the development of your airlines & trains..... And between them you get millions of potential business opportunities for the export of Turkish goods.... And the 30 Million that come have saved money to spend in Turkey they are NOT 30 million homeless people or free loaders they 30 million that contribute to your economy so complaining about the trash they leave behind is petty!

In fact in the list of the top 10 largest GDP's it's only Brazil which is a vast and fertile country with a population of 200 million people whos exports are more than triple that of Iran's that doesn't have at least 10 million Tourist visiting every year
Both Iran and Brazil have a Tourism problems and the Brazilian government is working over time to fix it!

and except for Brazil that has it's own problems there isn't a single successful economy in the world (With a population of 20mill people) that doesn't have at the very least 15 Million Tourists coming every year!​

But even with the 8th largest economy in the world & exports 3 times that of Iran & a service industry that contributes to over half of their GDP at the end of the day due to a lack of Tourism has resulted in a per capita purchasing power lower than Iran and Turkey which means the Brazilian people aren't doing as well as they should be and poverty if far greater than it should be

So clearly you fail to appreciate and comprehend the indirect benefits those 30 million have had on Turkey's Economy

So there IS NO OTHER WAY!

Im not against tourism generally, what im talking about is the cheap mass tourism with little contribution compared to the number, for exsample:


Switzerland - 9 million = 21 billion$
Turkey - 30 million = 37 billion $

Now you can say that Switzerland is more expensive, well ok then lets compare Thailand to Turkey.

Thailand - 32 million = 42 billion$
Turkey - 30 million = 37 billion $

Notice that stuff are way cheaper in Thailand compared to Turkey yet its on par.

The only thing bolstering the numbers are cultural, city and rich Arabic tourists which 10 million visit Istanbul and a couple million in places like Cappadocia, the 2/3 rest are European tourists whose only spending is a couple hundred Euro for hotels and flight.


It is a contribution its true but its not much for what it is, Tourism is a nice side contribution but its never a viable economic model, Greece is the prime exsample how it can backfire.

 

[VEVAK]

Im not against tourism generally, what im talking about is the cheap mass tourism with little contribution compared to the number, for exsample:


Switzerland - 9 million = 21 billion$
Turkey - 30 million = 37 billion $

Now you can say that Switzerland is more expensive, well ok then lets compare Thailand to Turkey.

Thailand - 32 million = 42 billion$
Turkey - 30 million = 37 billion $

Notice that stuff are way cheaper in Thailand compared to Turkey yet its on par.

The only thing bolstering the numbers are cultural, city and rich Arabic tourists which 10 million visit Istanbul and a couple million in places like Cappadocia, the 2/3 rest are European tourists whose only spending is a couple hundred Euro for hotels and flight.


It is a contribution its true but its not much for what it is, Tourism is a nice side contribution but its never a viable economic model, Greece is the prime exsample how it can backfire.

You think $40 Billion is not a lot of money & foreign currency? $40 Billion is how much Oil Iran exports and there is no other product that Iran exports as much as Oil!

Iran's total 2016 exports combined were only $87 Billion USD and vast majority of which were Oil, Gas & Petrochemicals that by the most part went to the government vs $40 Billion in Turkey that got distrusted among the masses and between various Turkish companies that forced them to improve the quality and design of their products and employed millions of Turks with other indirect contributions that far out way any other industry in the world!

So when you talk about $40 Billion USD worth of foreign currency coming into your country not being a big deal just shows how little you truly comprehend of the value of that cash.

Turkey's total exports are $150Billion USD so yea $40 Billion is a lot and Turkey owes a large portion of those $150 Billion in exports to the indirect benefits of it's Tourism industry!

Money brings money and without Turkey's Tourism industry the Turkish economy would not be where it is today just as without Iran's Oil industry Iran's economy would not be where it is today.

You think if Iran stops exporting Oil tomorrow all that will be effected is $40 Billion USD from it's GDP? NO! Just as if Turkey was to close it's boarders the effects will NOT be limited to that $40 Billion USD.

And Cash is Cash it doesn't matter if it's Arabs binging in the money or Chinese or Europeans as long as they bring MONEY.

No healthy economy in the world can afford to implement policies that cuts out Tourism because it's a vital part and one of the pillars of any healthy economy in the world.

Also, for Iran the policies that end up cutting out Tourism have also diminishing various other industries.

It diminishes or cuts out the Alcoholic Beverage industry, Bar & Night Club industry, Music Industry, Film and Cinema, Radio, TV which also effects marketing industry and that effects every consumer product produced in your country.....

Over the past 3 decades all of these industries in Turkey have turned into multi billion dollar industries!

Turkish movies and TV shows over the past 2 decades have gone from TV soap opera type junk to honestly THE BEST TV shows I have EVER seen in my life ever! Yes in terms of special effects they may not yet be on par with Games of Thrones type shows yet but the stories are better.
Today Turkish TV shows like Muhtesem Kosem, Diriliş Ertugrul & others are so good that they get translated and watched all across the region and now Turkey can slowly start to use those shows to distribute and market Turkish made products all across the region.

The governments of most healthy economies make money from TV, Radio & Cable where as in Iran it cost the Iranian government money to operate them!

Iran for it's size, population & economy probably has one of the most underdeveloped beaches, Ski resorts & even historic sites.

So Iran is shooting it's self in the foot with the policies it has & those policies don't just effect Tourism it's just that Tourism is the most important industry that they do effect!

 

[PeeD]

Check out how many tourists South Korea had in the 90s to mid 2000s where it had it's financial breakthrough. Same with Japan in the 60s and 70s.

Yes it was industry and technology that made them what they are today, tourism came later.

At least get the facts straight and compare apples with apples.

 

[Stryker1982]

Check out how many tourists South Korea had in the 90s to mid 2000s where it had it's financial breakthrough. Same with Japan in the 60s and 70s.

Yes it was industry and technology that made them what they are today, tourism came later.

At least get the facts straight and compare apples with apples.

Yes Industry & Technology, also developed infrastructure contributes a lot to tourism. But don't expect anyone, from europe, or Asia, or the region to tour Iran while their wives are force to wear hejabs they don't want to wear.

 

[VEVAK]

Check out how many tourists South Korea had in the 90s to mid 2000s where it had it's financial breakthrough. Same with Japan in the 60s and 70s.

Yes it was industry and technology that made them what they are today, tourism came later.

At least get the facts straight and compare apples with apples.

A healthy economy in any country can't afford to implement policies that results in diminishing one of the pillars of any economy and one of the main sources of foreign currency which is Tourism!

And I'm not comparing Iran to S.Korea or Japan! I'm comparing Iran to one of it's neighbors who has roughly the same size population and is technologically around the same level as Iran.

At the end of the day supporters of Hejab by Force in Iran are enemies of Iran just as countries that place sanctions on Iran are enemies of Iran! Because the destruction of Iran's economy is the true end result of such policies and whether it's an unintended consequence is irrelevant!

You can't force Hejab on people and think the economy wont be effected! Just as you can't destroy a countries music & entertainment industry and think the economy as a whole wont be effected.

You can't restrict TV & Radio and think marketing in your country won't be effected just as you can't implement policies that diminishes marketing & think such policies don't effect consumer products produced by your country!!!!