Iran

Iran is the territory where one of the most ancient civilizations in the world was once formed. Now its echoes and achievements have become the national treasure of this country. The state is located in Western Asia. It is the second largest country in the Middle East after Saudi Arabia. For many centuries and to this day, this country has played a key role in the East, and modern Iran is one of the most technologically advanced states in the region.

The current state of Iran until 1935 was called Persia. Now the official name is the Islamic Republic of Iran. The territory of the country is 1.6 million km². The official language is Persian. The population of Iran is 83 million people. Persians, Azerbaijanis, Kurds and Lurs are the most significant ethnic groups in Iran. The capital of the state is located in Tehran. Iran is divided into provinces, which, in turn, are subdivided into districts, and the next level of territorial division is the district. Most Iranians are Muslims. Shia Islam is established as the state religion. The official currency is the Iranian rial. Iran is a fairly safe country, the level of crime and terrorist threats is low.

For many centuries, this country has played a key role in the East, and modern Iran has the fourth largest GDP economy in the Islamic world and the second largest in Western Asia (after Turkey). Iran has earned this position due to its location in the strategically important region of Eurasia, as well as its large reserves of oil and natural gas. These resources are the basis of the country's economic development.

The history of statehood in Iran is one of the oldest in the world and covers almost 5 thousand years only according to written sources. Iranian peoples become predominant in the country by the beginning of the 1st millennium BC. Aryas came here in the second millennium BC, and brought with them their culture and crafts. The Achaemenid dynasty founded the first Persian Empire, which was the prototype of modern Iran. The Persian Empire under Darius I stretched from Greece and Libya to the Indus River. Persia was the most populated state in history (50% of the world's population were subjects of the Achaemenids), was one of the strongest and most influential culturally and politically states until the 17th and 18th centuries, but at the end of the 19th century Persia turned into a semi-colonial state. In 1979, the Islamic Revolution took place in Iran, led by Ayatollah Khomeini, during which the monarchy was overthrown and an Islamic republic was proclaimed.

From the north, Iran is washed by the Caspian Sea, from the south — by the Persian and Oman gulfs of the Indian Ocean. In the west it borders with Iraq, in the northwest with Azerbaijan, Armenia, Turkey, in the north with Turkmenistan, in the east with Afghanistan and Pakistan. Due to the arid climate and mountainous terrain, Iran does not have sufficient water resources. There is only one navigable river in the country — Karun. Most of the country is occupied by deserts and semi-deserts with low cliffs. In the north of Iran, the Elburz mountain range stretches. Natural conditions allow the cultivation of a variety of crops — rice, tea, date and banana palms, pistachios, citrus fruits. Tehran is considered one of the most environmentally disadvantaged cities in Asia. The city suffers from smog caused by the abundance of emissions from obsolete vehicles, enterprises and the peculiarities of the circulation of air masses in the foothills of Elburz.

Iran is a very conservative Muslim country. Perhaps that is why the Iranians have retained many of their customs and traditions. Most of them are religious in nature. In March, Iranians celebrate Novruz, which is dedicated to the beginning of the New Year (the Iranians have their own calendar). Iranian cuisine is one of the most delicious in the world. Tea is the national drink of Iran, here it is drunk strong and hot. Alcohol in Iran is forbidden by religion, although it is allowed to be drunk for religious purposes, in mosques and by non-Muslims with special permission. There is a strict dress code for women in the country — a covered head, closed legs to the ankles and hands to the wrists, hiding the figure with a skirt or coat over trousers. The rules also apply to tourists.

The attitude to work is manifested in the national character in such traits as efficiency, practicality, accuracy, punctuality, etc. Possessing a lively and sharp mind, the Iranians are disposed to abstract thinking, brightness and liveliness of imagination. They are not alien to humor, they also like to talk. The adoption of important decisions for the Persians is accompanied by much thought and advice from their loved ones. In conversations, an even positive tone, the absence of long pauses and the speed of speech are important to them. Despite Eastern traditions, Persians marry late, at about 30-40 years old. Like many easterners, Persians love to trade and bargain. Also in Iran, the influence of the family is great — usually people live for several generations in the same house.

According to the constitution adopted in 1979, Iran is an Islamic republic. As of 2019, Iran is one of the few existing theocracies in the world. The head of state is the Supreme Leader. It determines the general policy of the country. Rahbar — Supreme Commander of the Iranian Armed Forces, head of military intelligence. The supreme leader appoints people to key positions in the state: the presidents of the courts, the head of the police and the commanders of all branches of the armed forces, as well as six of the twelve members of the Council of Guardians of the Constitution. The Supreme Leader is elected by the Council of Experts and is accountable to it.

The second most important official in Iran is the president. The President is the guarantor of the constitution and the head of the executive branch. Decisions on key issues are made only after the approval of the Chief Executive. The President appoints the members of the Council of Ministers and coordinates the work of the government. Legislative power is represented by a unicameral parliament — the Mejlis.

The laws of the Islamic Republic are based on Islamic law. The state apparatus is closely intertwined with the Islamic clergy. Iran also has diplomatic missions in most countries of the world.

Iran is the largest economy in the Middle East, second only to China, Japan, India and South Korea in terms of GDP in Asia. Iran is an agro-industrial country with a developed oil industry. There are oil refineries and petrochemical enterprises. Mechanical engineering and metalworking, as well as the food and textile industries are widely represented. Handicraft production of carpets and hardware is developed. Among the most important agricultural crops: wheat, barley, rice, legumes, cotton, sugar beets, sugar cane, tobacco, tea, nuts, pistachios. Animal husbandry is based on the breeding of sheep, goats, camels, and cattle.

45% of budget revenues come from oil and gas exports, 31% from taxes and fees. Inflation is 15.8%. Main export items: crude oil and refined petroleum products, metal ores, agricultural products. The main import items are products of heavy engineering and the chemical industry, automobiles, iron, steel, minerals, textiles, and paper.

Iran's main trading partners include China, Japan, Germany, Russia, France, Italy and Turkey. Iran is a key member of the Economic Cooperation Organization, which includes the countries of Southwest Asia as well as the Central Asian republics of the former USSR. Iran is actively developing economic ties with the countries of the region and aims to form a free trade area similar to the EU. Free commercial and industrial zones are being developed in Chabahar and on the island of Kish.

There are a number of business features in Iran that are worth considering before starting a business. For example, the work of Russian firms has a nuance — this is the lack of direct financial interaction with Iran. Now there is "Mir Business Bank" — in Moscow, Astrakhan and Kazan. This is a Russian bank with 100% Iranian capital. Also, now there is an agreement between the Central Banks of Iran and Russia that the Mir payment system will be paired with the Iranian Shetab system, created for internal settlements. It is also important to mention that there has never been a Visa or Mastercard in Iran.

If we talk about the business system, then in Iran there is a classification of companies that divides them into three types. The first type is companies registered in a commercial and industrial free zone. The second is companies registered in the special economic zone. The third is companies registered on the mainland, these are usually local and local organizations.

If a company is registered in a free commercial and industrial zone or a special economic zone, then it receives one of the main advantages — tax benefits. And also tax exemption for 20 years, but only on the condition that the company operates within the company's registration zones. If a company registered in a Free Trade Zone or Special Economic Zone operates on the mainland (other cities of Iran that are not free zones), this company will be required to pay tax, since the source of income is generated on the mainland. The use of free trade and industrial zones or a special economic zone is usually recommended for factories that manufacture products in a free zone and then export them outside of Iran.

With regard to Russian firms, experts argue that usually Russian companies enter the market through some Iranian firm or, most often, find Iranians who live and have enterprises in the West and through them establish contacts.

At the moment, foreign investors can create their own company with 100% share ownership and control over their business. This may be an advantage for some companies wishing to be more involved in the Iranian market, providing them with greater security and stability as foreign investors.

The most favorable zone for investors in Iran is the commercial and industrial free zone. Here are some of its benefits for investment: tax exemption for 20 years from the date of commencement for all types of economic activity; protection and guarantees of foreign investments; simplification of the issuance of a residence permit for foreigners; simplified regulation of labor relations, employment and social security; the use of a trained and skilled workforce in all different skill levels and professions.

Thus, the internal economic prerequisites for attracting foreign capital to Iran are very significant — this is a large commodity market, a fairly high level of education and healthcare, and relative macroeconomic stability.

The complex of socio-economic, political and legal factors that affect the investment attractiveness of Iran paints a rather positive perspective picture of the country's development. After the IAEA releases the first report on Iran's fulfillment of its obligations under the JCPOA, the country's return to the international banking system will begin. This will restore pre-sanction levels of oil exports and foreign trade in other areas, achieve relatively stable macroeconomic indicators, attract investment in the infrastructure of the fuel and energy complex and heavy industry.

Foreign investment in Iran enjoys the protection of the state. To create favorable conditions for foreign investors, the legislative and regulatory framework is constantly being improved. Thus, in 2008, amendments were made to the law “On the Promotion and Protection of Foreign Investments”, which removed a number of restrictions.

Foreign companies, as a rule, provide a foothold in Iran through branches and representative offices. Alternatively, some foreigners choose to do business through a limited company or private equity company, often with experienced local partners. Investments will be protected under bilateral investment treaties to the extent that the parties have entered into an investment agreement.

On the part of the state, business support is carried out mainly through a system of laws and investor rights. But there is a non-governmental organization in Iran that provides support systematically. This is the Iranian Office, an Euro-Iranian enterprise headquartered in Brussels, operating in Tehran and the main cities of Iran. Its services are intended for international companies operating in Iran. The range of the company's activities covers corporate services to improve efficiency and business development. The efficiency of the company is ensured by cooperation with the departments of the Chamber of Commerce and Industry in Iran.