Double-digit Growth

How does the JCPOA represent a turning point in the country’s goal of attracting 20 million tourists in 2025?

After the lifting of sanctions, we entered a new environment in the development of the country with new opportunities ahead. We had a boost in the tourism sector before the beginning of 2016, as we started promoting tourism in Iran in 2013 with the new government of HE Dr. Hassan Rouhani and its approach of cooperation with the world. During the last three years, tourism trends have been increasing in the country, with 30% growth. Iran could achieve a 10% increase in inbound tourism per annum, which is double the world’s average of 4.6% growth in this sector. After the P5+1 agreement, the negotiations held with different countries in the past years are reaching more tangible terms and coming to real steps with different companies around the world.

How do you assess the appeal of the tourism industry in Iran to attract foreign investment in order to create 400 hotels by 2025?

This target has been set in terms of quantity and not quality in order to achieve the goal of 20 million tourists by 2025. Considering Iran’s capacity and tourism attractions in terms of cultural, natural, historical, pilgrimage, and health tourism, we are renovating our software and hardware infrastructure. In terms of hardware, we need to promote and develop hotel construction to provide facilities and services for foreign travelers. We need to establish 400 four- and five-star hotels; however, we also need to create one-, two-, and three-star hotels as well as hotel apartments for different economic levels of the society. We are also promoting ecotourism for nature-based tourists who are visiting the country. At the same time, we need to renovate the aviation industry, the railway system, and build new roads to connect the different tourism attractions of Iran. In this regard, some of our monuments need restoration as well.

What response have you had so far from foreign investors interested in the development of the Iranian tourism industry?

Before the JCPOA signing, we had several negotiations with governmental and semi-governmental companies. After the implementation of the JCPOA, we stepped toward the execution of this agreement with some of them, achieving three tangible deals with two Turkish companies and a German group. We have also received a request from a foreign company in a joint venture with a local partner to establish road complexes and provide all services to pilgrims in 30 points on the route from Azerbaijan to Mashhad. We also have an agreement with another company interested in the renovation and restoration of cultural and historical monuments. Moreover, we are hosting an international conference on investment on the Iranian hotel industry. We invited more than 25 foreign hoteliers and other service providers in the tourism sector to introduce them to some 1,500 projects with an estimated value of USD30 billion envisaged for the next five years.

What are your expectations for the year ahead?

Some 5.2 million tourists visited Iran in 2015. In 2016, we expect to have 5.8 million tourists coming to the country, a 10% growth. The new approach of the government toward international relations as well as the safety and security of the country in comparison with the rest of the region are the main reasons for the increase in inbound tourism. Within the next 10 years, we need to have an average annual growth of 7-10% in order to achieve our target. The Travel Agency Association of Iran just reported the average hotel occupancy rate at 70%, and we expect to have the same trend for next year. Next year, we will increase the number of hotels in Iran to provide the required services by benefiting from all capacities available in the country in order to achieve the target we have set for 2025.