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Decoding Iran’s 'resistance economy'

Iran’s economic plan is to build domestic capacity to reduce Iran’s vulnerabilities to sanctions and external shocks.
A picture taken on February 3, 2014 shows low-income Iranians lining up to receive food supplies in southern Tehran. Iranian President Hassan Rouhani faced harsh criticism from conservatives today over what they say is a poorly implemented scheme to distribute food to low-income families in the sanctions-hit Islamic republic. The programme aims to hand out packages of frozen chicken, rice, vegetable oil, cheese and eggs to poor families ahead of Iranian New Year celebrations in mid-March.  AFP PHOTO/ISNA/DA

In a decree issued Feb. 19, Iran's Supreme Leader Ayatollah Ali Khamenei introduced the general policies of Iran’s “resistance economy.” The following are some of the key objectives presented in this document:

  • Domestic capacity building with maximal utilization of the country’s resources, with a special focus on the participation of lower and middle-income classes in wealth generation
  • Promotion of a knowledge-based economy through drafting and implementing a comprehensive, scientific plan for the country and promoting innovation with the ultimate goal of becoming the No. 1 knowledge-based economy of the region
  • Increased efficiency in economic activity, improvement of economic competitiveness
  • Utilization of subsidy reforms to optimize energy consumption in the country, increase employment and domestic production and promote social justice
  • Improve Total Factor Productivity based on the empowerment of domestic human resources through skills education
  • Promotion of domestic production, especially in strategic products and services and the consequent reduction of dependence on imports
  • Provision of food and medicine security
  • Consumption management based on the promotion of consumption of local products parallel to the qualitative improvement of domestic production
  • Comprehensive reform of the financial system to respond to the country’s needs
  • Targeted promotion of exportable goods and services through legal and administrative reform as well as the promotion of foreign investment for export purposes
  • Increase the economy’s resistance through regional and international economic collaboration, especially with neighbors but also through diplomacy
  • Reduce vulnerability of oil and gas exports through the selection of strategic buyers and involving the private sector in diversifying sales channels
  • Increase oil and gas value-added exports
  • Increase oil and gas strategic reserves and production to have an impact on international markets
  • Implement reforms to rationalize government costs, increase tax revenues and reduce dependency on oil and gas export revenue
  • Increase the share of the National Development Fund from oil and gas export revenues
  • Increase transparency in financial matters and avoid activities that pave the way for corruption

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