Page 17 - Iran OUTLOOK 2025

in stark contrast to the financial reality faced by many Iranians, who confronted a combination of stagnant employment opportunities, persistent inflation, and currency depreciation. This divergence between high-end property developments and widespread affordability challenges underscored the complex socioeconomic dynamics shaping Iran's urban housing market in 2024.
• 6.4 Retail
In 2024, Iran's retail sector showed notable growth potential despite broader economic headwinds. Market projections out to 2030 indicate sustained expansion, underpinned by several key demographic and social factors, including continuing urbanisation and Iran's predominantly young population.
E-commerce emerged as a particularly dynamic segment within the retail landscape. The sector is forecast to reach $15.77bn in 2025, with projections suggesting substantial growth to $24.59bn by 2029, representing a robust annual growth rate of 11.75%. This trajectory reflects increasing digital adoption among Iranian consumers and the growing sophistication of online retail platforms.
However, the retail sector's performance must be viewed within the context of broader economic challenges. Whilst household spending showed modest improvement, growing by 2.8% in 2024 compared with 2.6% in 2023, this growth remained constrained by persistent economic pressures. High inflation and ongoing currency depreciation continued to affect consumer purchasing power, influencing spending patterns and retail market dynamics.
The combination of structural growth drivers and economic headwinds created a complex operating environment for retailers in 2024. Whilst demographic trends and digital transformation supported market expansion, the impact of macroeconomic challenges on consumer spending power remained a significant factor shaping the sector's development.
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