Business Environment is defined as all the factors that have an influence on business enterprises’ performance, which usually cannot be controlled by their managers. Today, improving the environment of business is one of the most crucial strategies for every country’s economic growth. Therefore this improvement needs thorough planning and appropriate policymaking, which can only be obtained by the continuous process of monitoring and evaluating country’s business environment status. In Iran Since 2011, chambers were required to inform the policymakers and authorities of business environment status in the country for each province and economic activity.

The following results are from the fifth seasonal report that the chambers of Commerce, Industries, Mines and Agriculture have presented with the approach of combining survey data with statistical data based on Schein’s theory of entrepreneurship.

Overall Results

According to the results of Iran’s National Monitoring report of Business Environment in the fall of 2017, the national business index was 5.85 (10.0 being the worst) which is somewhat worse than last season’s evaluation (5.77 in the summer).

Top Factors 

In the fall of 2017, economic activists who participated in this report announced the three factors of: 1- inconsistency and unpredictability of prices (raw material and products), 2- financial supply difficulty from banks, 3- inconsistency of policies, laws and monitoring process of businesses, as the most unfavorable factors, and the three: 1- limitation access to electricity, 2- limitation access to fuels (gas, gasoil,…), 3- limitation access to communications (cellphone and internet), as the most favorable factors in country’s business environment. It’s noticeable that in each of the four previous evaluation reports, the most unfavorable factor was financial supply difficulty from banks, however this time it was replaced by inconsistency and unpredictability of prices (raw material and products). Also, limitation access to electricity was evaluated as the most favorable factor in all of the 5 evaluations.

Conditions in Provinces

These results also evaluated the provinces of Kermanshah, North Khorasan and Ilam as having the worst and Gilan, South Khorasan and Mazandaran (in that order) as having the best business environment status.

Conditions in Economic Sectors

These results showed that the business environment status in Agriculture was better compared to industry and services. Among the branches of economic activities, the branches: 1- teaching. 2- building and 3- mining (in that order) were evaluated as having the worst, and the branches: 1- administrative and support services, 2- supplying services of food and place and 3- health and social work as having the best status in the business environment.

These results were gathered from Iran’s National Statistic and Economic Information Center. And based on Shein’s theory of entrepreneurship, the national index of Iran’s business environment in the fall of 2017 was 6.03 (10 being the worst), which is somewhat worse than the last season (5.92 in the same summer). In this year’s results, the condition of most influential factors in the business environment has been evaluated more unfavorable.

Read the full report in Farsi from this link.

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