Is Tourism Able to Replace Oil as Main Source of Revenues for Iran?

EghtesadOnline: Iran has 157 four- and five-star hotels and by the end of President Hassan Rouhani’s second term in 2021, the figure will increase to 210.

News ID: ۷۴۶۴۷۱

13 January 2019

"When the infrastructures are complete, income from tourism will replace oil revenues. When this happens, we will have created jobs and insured ourselves against the sanctions,” Ali Asghar Mounesan, the head of the Iranian Cultural Heritage, Handicrafts and Tourism Organization, tweeted recently.

The tweet implies that tourism income can substitute those of the oil sector and that this can materialize by building more hotels and developing related infrastructure.

While experts and businesspeople active in the tourism sector believe the former is not impossible, they are also of the opinion that the way to achieve this goal is not merely through building more hotels and tourism facilities, the Persian daily Donya-e-Eqtesad reported.

The deputy head of Iranian Tour Operators Association says tourism has the capacity to replace oil revenues provided the sector gets the attention it deserves, according to Financial Tribune.

“We have inadequate tourism infrastructure, including lodging centers. But, at present, Iran does not receive that many inbound tourists for this to create a problem. However, if our inbound tourism figures were to increase, our current infrastructure won’t be sufficient to meet demand. This increase happened after the nuclear agreement and since there were not enough hotels and lodging centers, we were forced to cancel some of the tours,” Mohammad Ali Ashraf Vaqefi added.

The official believes other measures must be taken to achieve this, stressing that these measures could not be carried out by the private sector alone or public bodies in charge of tourism such as ICHHTO.

“Right now, what’s preventing foreigners from visiting Iran is the country’s negative image in the international arena. While Iran is one of the safest countries in the world, hostile propaganda against us discourages potential tourists from considering Iran as a destination,” he said.

Vaqefi noted that this image has to be rectified before other steps are taken.

Mostafa Shafiei Shakib, a board member of Iranian Tour Operators Association, says the first step for us is to introduce Iran to the world the way it really is.

“When it comes to infrastructure, inadequate hotels are not the only problem we face. There are insufficient restaurants or water closets. Transportation is not satisfactory either and there are not enough buses and minibuses for conducting tours. On top of these, we have few expert tour guides,” he said.

Shakib said most tourists visiting Iran prefer to stay in a three- or four-star hotels and consider five-star ones as too luxurious.