NEW YORK, Dec. 16, 2015 /PRNewwire/ -- Several international sanctions were imposed over Iran over the last decade, restraining its international trade capacity. Yet, Iran is the 17th largest economy in the world; its Gross Domestic Product (GDP) was $415.3 billion in 2014. The nuclear sanctions imposed by the United Nations on Iran resulted in trade bans and restrictions on financial transactions, severely affecting the pharmaceutical and medical tourism sectors. This report assesses the impact of the lifting of these international sanctions on Iran's healthcare market. It analyses market dynamics such as drivers and restraints and also provides estimates on the future of Iran's pharmaceutical and medical tourism sectors.
Iran's Healthcare Market—Growth Potential
- Several international sanctions were imposed over Iran over the last decade, restraining its international trade capacities. Yet, Iran is the 17th largest economy in the world; its Gross Domestic Product (GDP) was $ billion in 2014.
- The nuclear sanctions imposed by the United Nations on Iran resulted in trade bans and restrictions on financial transactions, severely affecting the pharmaceutical and medical tourism sectors.
- Despite the import of food and drugs being exempted from sanctions, there has been a shortage of imported drugs due to financial road blocks such as restrictions on SWIFT payment methods.
- From 2015 onwards, there is an increasing international consensus to ease nuclear sanctions. This will likely allow the Iranian pharmaceutical sector to produce adequate drugs needed for domestic use. This
will also improve the prospect of Iran opening up to trade and providing opportunities for pharmaceutical companies to be a part of its growth. Frost & Sullivan expects that by mid-2016, there will be a positive
momentum to support lifting of sanctions over Iran, especially by the US Congress while the International Atomic Energy Agency (IAEA) verifies Iran's compliance with nuclear deal requirements.
- Frost & Sullivan expects that this ease will increase the import of drugs as well as boost manufacturing from the pharmaceutical companies for generic drugs licensed by European and US companies.
- The government of Iran is more reform-oriented to position Iran as a business friendly nation, and it took effective measures to bring inflation under control at % in the first half of 2015 .
- International companies have gradually started to leverage this positive environment. Novo Nordisk plans to build a manufacturing plant for approximately $ million (€ million) in Iran. Iranian companies
benefit with increased access to finance and technology, while the Iranian people will benefit from a competitive healthcare landscape and improved value for money.
Economic Overview of Iran
Iran's economy is extremely dependent on its oil and gas sector. The nuclear sanctions imposed by the United Nations in 2010 had an adverse effect on inflation and employment, as inflation rose to % in 2012. Since 2013, it has been decreasing and is at % in 2015.
While Iran faced several sanctions and trade constraints in the last three decades, countries such as China, South Korea, Turkey, Russia, and other Middle Eastern countries have become trade partners of Iran.
Iran, with a population of million, is the 17th most heavily populated country in the world with the 17th largest economy.
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