BMI Industry View

Our outlook for the Iranian shipping sector depends on the current rapprochement between the pariah state and the West, and the attendant relaxation of sanctions, continuing. The Iranian economy will expand slowly in 2015 as talks on the nuclear programme continue without reaching a breakthrough, and BMI projects real GDP growth of 2.8% in 2015, following our estimate of a 2.9% contraction in 2013 and 2.8% growth in 2014. The shipping sector will be a major beneficiary of an easing of sanctions, not only through a general recovery in the economy, but also from a fundamental perspective. The removal of port operator Tidewater from EU sanction lists means that international shipping companies are set to begin calling at Iranian ports such as Bandar Abbas once more. Growth will take time to recover, however, given the massive inflation seen in Iran in recent years, and the damage done to consumers' purchasing power as a result.