BMI View: The outlook for the Iranian freight sector is positive, as a relaxation of sanctions - expected to be implemented in earnest from the third quarter of 2015 - will see the economy return to positive growth, thereby boosting demand for freight transport services. Fundamentally, the sector will also benefit from a relaxation of sanctions, as many Iranian firms have been directly targeted by restrictions, while foreign companies have been wary of entering the market. The recovery will not be explosive; there remain significant macroeconomic challenges, and the country's infrastructure also needs work - but continued investment and steady economic growth will see volumes across the country's freight transport modes continue to expand over our forecast period to 2019 and beyond.
We forecast total road freight volumes will rise by 2.1% year-on-year over 2015 to reach 109mn tonnes.
We forecast total rail freight volumes will rise by 0.7% year-on-year over 2015 to reach 33.36mn tonnes.
We forecast total air freight volumes will rise by 0.9% year-on-year over 2015 to reach 101,320 tonnes.
We forecast total nominal trade value to rise by 7.5% to reach USD251bn in 2015.
The top trade partners will be the UAE, China, India, South Korea and Turkey.
Our expectation for sanctions to be unwound on Iran from Q315 will provide a significant boost to the country's economy, and, directly and indirectly, on the country's freight transport sector. Sanctions across sectors such as on shipping, banking and oil will be relaxed as Iran complies with Western powers' demand over the dismantling of its nuclear programme. On the back of this we forecast Iran's economy to return to growth in 2015, following three years of recession.
We forecast that in 2015, Iran's road haulage volumes will enjoy positive growth for the first time since 2012, predicting a 2.1% expansion in volumes. If realised this would see 109bn tonnes transported over the course of the year. This return to growth follows two consecutive years of estimated contractions in volumes in 2013 and 2014, of 1.5% and 1.3% respectively. The outlook for the Iranian consumer is vastly improved given the relaxing of sanctions, and investment in the network will also help support an expansion in volumes. There remain significant impediments to growth, however, and we do not expect growth in road freight volumes to really pick up until 2016.
In 2015, BMI forecasts that Iranian rail freight will see growth of 0.7%, taking the total tonnage transported by rail to 32.36mn tonnes. Rail freight tonnes-km will see growth of 0.2%. These forecasts mark a return to growth following estimated contractions of 0.9% and 0.6% respectively, the second consecutive year of declines in volumes. This growth forecast is in part predicated on the improving outlook for the Iranian economy, and in part on its increasing importance as a transit hub between Asia and Europe.
We forecast that air freight will begin a slow recovery in 2015, predicting that the transport mode will record 0.9% growth in volumes over the course of the year. Air freight has been the major loser over the past several years as a result of the western sanctions imposed on Iran in an attempt to halt its alleged nuclear weapons development programme. Not only has the sector suffered indirectly as a result of the economic impact of the sanctions, but it has also been directly targeted, with Iranian carriers unable to offer full services thanks to bans on entering foreign airports, and even on purchasing spare parts. Foreign operators have also been unable to enter the Iranian market thanks to embargoes.