LONDON: Civil unrest has flared in Iran even as it powered out of recession following the easing of international sanctions last year.
But economic recovery hasn’t yet fed through to the mass of the people, experts told Arab News.
Sanam Vakil, associate fellow at Chatham House said: “After negative growth, Iranian GDP was at 7 percent in 2016/17, 6 percent driven by hydrocarbon exports.”
Iran is energy-rich, holding the world’s fourth-largest proved crude oil reserves and second-largest when it comes to natural gas, said the US Energy Information Administration.
And yet, despite its lavish endowment of oil and gas, the energy premium had not kicked in — “we should expect a ‘trickle down effect’ that will take time, said Vakil.
The protests were about increased expectations following the nuclear deal which was “oversold” to the Iranian populace, she added.
“It wasn’t as impactful as people thought it would be,” said Vakil.
There was a lack of acknowledgement that there would continue to be a number of obstacles as result of secondary US sanctions.
A paper from London-based BMI Research, emailed to Arab News said: “Inflation has declined substantially since president Hassan Rouhani entered office in 2013 — but it remains elevated, standing at 9.6 percent year-on-year in November (up from 8.4 percent in October).”
BMI adds: “Unemployment, meanwhile, has risen as upticks in hydrocarbon exports and foreign investment have failed to spur large-scale job creation: it was officially recorded at 12.6 percent of the labor force in July, but is widely assumed to be significantly higher.”
According to BMI, Iranians’ expectations for economic conditions to improve on the back of the 2015 nuclear deal and 2016 lifting of most international sanctions have not been met.
Many (particularly in the more rural areas of the country) perceive the political establishment to be highly corrupt, and not acting in the best interest of ordinary Iranians, said BMI.
Vakil said the Iranian government faces “political obstacles and need to be communicating more.”
“Rouhani is trying to curb corruption, and make institutions more transparent. But some of these institutions are pushing back. There are tensions, the government is running up against clerical foundations … people that account for quite a big percentage of government budget, but don’t want any strings attached [such as transparency],” said Vakil.
Additionally, Rouhani had to pursue banking reform because Iranian banks have a massive percentage of non-performing loans, she said.
A 2017 International Monetary Fund (IMF) report said global banks still face an extremely high compliance burden to do business with Iran.
How can Iran better ramp-up its energy resources to spread prosperity? Vakil said Iranian gas hasn’t really taken off and needs massive investment.
The IMF pointed out that Iran’s natural gas sector had been expanding, but production growth had been lower than expected as a result of the lack of foreign investment and technology.
Located offshore in the Gulf, the South Pars natural gas field holds almost 40 percent of Iran’s gas reserves, but it is being developed mostly by Iranian companies because most international companies have pulled out. The IMF said development has been faced numerous delays.
When it comes to oil, there are several factors at play. Prices are weak, and as the second largest member of OPEC, Iran must comply with production cuts agreed last year. On the other hand, like other countries, it is seeking to boost income from outside the energy sector to cut its dependance on hydrocarbons.
Iran shipped 777 million barrels of crude last year, the state news agency Shana said recently in a report used by Reuters. The same report said Iran had he country exported 490,000 barrels per day of gas condensate.
The combined daily exports of crude oil and condensate were said to be on a par with what the country used to export in oil and condensate before the imposition of economic sanctions because of its nuclear program, according to Shana.
An IMF mission to Iran in December 2017 found that growth had begun to broaden to the non-oil sector.
“Real GDP growth is projected to reach 4.2 percent in 2017/18 and is expected to be sustained or even rise toward 4.5 percent over the medium-term if financial sector reform takes hold,” said the IMF.
But the IMF also argued for faster implementation of structural reforms, completion of anti-money laundering/combating the financing of terrorism reforms, and the removal of obstacles to private sector development that would allow growth to become more diversified, resilient and job intensive.
Credit institutions and banks needed urgent restructuring and recapitalization, it added.
“Despite recent improvements in the business environment, Iran needed to reduce red tape, reform state-owned enterprises and improve transparency about corporate beneficial ownership to attract investment and develop the private sector,” said the IMF.
Iran energy riches fail to bring prosperity
Iran energy riches fail to bring prosperity
Airports in GCC are turning stopovers into tourism growth
- Governments and airport operators are turning aviation as a central pillar of tourism and economic strategy
CAIRO: Once defined by fleeting layovers and duty-free corridors, airports across the Gulf Cooperation Council are increasingly gateways to short-stay tourism, driving non-oil growth, hospitality revenues and job creation.
Across the region, governments, airlines and airport operators are treating aviation not merely as a transport sector but as a central pillar of tourism and economic strategy. Through streamlined visa regimes, airline-led stopover programs and sustained investment in airport infrastructure and technology, GCC countries are turning transit passengers into visitors.
“Across the GCC, destinations have shifted from functioning primarily as global transit hubs to positioning themselves as places travelers actively choose to visit, even for short stays during onward journeys,” Nicholas Nahas, partner at Arthur D. Little, told Arab News.
Airports in the Middle East are investing heavily in biometric processing systems, e-gates and digital border controls designed to shorten waiting times and improve passenger flow. These upgrades, backed by coordinated public-private initiatives, are narrowing the gap between arrival and exploration, making short stays viable even for passengers transiting for less than 48 hours.
Unified GCC visa
Two years after its initial proposal, the long-discussed unified GCC tourist visa is moving through final coordination stages, a development expected to further accelerate tourism spending linked to stopovers.
Looking ahead, the visa could allow the region to function as a single tourism corridor. Robert Coulson, executive adviser for real estate at Accenture, said the next phase is about regional continuity. “The next leap for the GCC is making the region feel like one seamless journey while differentiating each stop with a distinct identity,” he told Arab News.
First proposed in 2023 and approved in principle in 2024, the visa is designed to allow travel across Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE under a single permit. Analysts say Saudi Arabia is positioned to be among the biggest beneficiaries, given its scale, expanding destination portfolio and growing aviation capacity.
The unified visa is expected to complement existing stopover initiatives by allowing travelers to combine short visits to Saudi Arabia with trips to Dubai or Doha, effectively turning the Gulf into a single multi-country itinerary rather than a series of isolated transit points.
Saudi aviation surge
Saudi Arabia’s aviation-driven tourism growth has accelerated rapidly. The Kingdom welcomed an estimated 122 million visitors in 2025, moving closer to its Vision 2030 target of attracting 150 million tourists annually.
“GCC travel hubs have stopped selling connections and started selling experiences,” Coulson said. “They’ve cracked the stopover-to-stayover model, turning a layover into a mini-holiday rather than dead time.”
In January, Abdulaziz Al-Duailej, president of the General Authority of Civil Aviation, said international destinations served from Saudi Arabia increased to 176 in 2025, while the Kingdom remained home to some of the world’s busiest air routes.
He credited this performance to the “unlimited support” of the Kingdom’s leadership, identifying aviation as a key enabler of Vision 2030 and broader economic diversification.
Saudi Arabia’s newest airline, Riyadh Air, is expected to contribute more than $20 billion to non-oil gross domestic product and create over 200,000 direct and indirect jobs, underscoring aviation’s expanding economic footprint.
A key pillar of Saudi Arabia’s strategy has been the introduction of a digital stopover visa in 2023, allowing transit passengers to enter the Kingdom for up to 96 hours. The initiative enables short visits for Umrah, trips to Madinah or exploration of the country’s cultural and historical sites. The policy reflects a broader regional effort to turn time spent between flights into economic activity beyond the airport terminal, particularly in hospitality, transport and cultural tourism.
Short-stay shift
This evolution has been driven by global connectivity, simplified visa access and the ability to deliver high-quality experiences within a 24-to-72-hour window. The UAE, particularly Dubai, was the earliest and most established example of this transition, converting a growing share of its transit traffic into visitors through airline-led stopover packages, flexible visa categories and dense, short-stay-friendly attractions.
Dubai International Airport handles more than 85 million passengers annually. Curated stopover products combining hotel stays with cultural and entertainment experiences have helped transform transit traffic into leisure demand. Direct metro access and streamlined entry processes have further reduced friction. As a result, Dubai welcomed around 19 million international overnight visitors in 2025.
Other GCC destinations have since adopted similar models. Abu Dhabi expanded stopover offerings through its national carrier, promoting entertainment and cultural districts as compelling short-stay experiences. Qatar embedded stopover tourism into its national tourism strategy, converting transfer traffic at Hamad International Airport into city stays. Saudi Arabia expanded its tourism offering through its 96-hour digital visa linked to onward flights.
A smooth transit experience is often the deciding factor in whether passengers remain airside or choose to explore. Fast entry processes, intuitive airport design and reliable airport-to-city connectivity can turn even a six- to eight-hour layover into usable time rather than idle waiting.
Under Vision 2030, Saudi Arabia has invested heavily in airport expansion, digital border processes and urban mobility projects designed to shorten the distance between arrival and experience. Airline stopover platforms, transport apps and airport-based destination messaging increasingly reduce uncertainty and enable spontaneous exploration.
Beyond transit traffic, Nahas said tourism growth across the GCC has been driven by integrated destination ecosystems. Successful destinations are designed end-to-end — from trip planning and arrival through accommodation, mobility, experiences and departure — requiring coordination across tourism authorities, airlines, airports, transport providers and experience operators.
Designing destinations
For developers shaping the region’s next phase of tourism growth, the focus has shifted toward creating destinations that capture travelers from the moment they arrive.
Sultan Moraished, group head of technology and corporate excellence at Red Sea Global, said next-generation destinations are being designed to resonate with global travelers beyond a flight connection.
“As we design and build next-generation destinations, our focus is always on creating experiences that resonate with global travelers from the moment they arrive to when they choose to explore beyond a flight connection,” he told Arab News.
Moraished said offering experiences travelers cannot find elsewhere, from cultural immersion to nature-based activities, creates compelling reasons to extend visits beyond simple transit. He added that collaboration across aviation, hospitality and destination authorities ensures that every part of the journey is aligned with a shared vision for tourism growth.
Looking ahead, Moraished said the intersection of innovation and hospitality will continue to open new pathways, from smart digital experiences to regenerative tourism practices that appeal to increasingly conscious travelers and encourage repeat visitation.
Experience economy
Airports have shifted from being standalone infrastructure assets to functioning as world-class distribution engines for cities and destinations. Investments in gateway airports have made them part of the destination brand promise.
Tourism operates as a continuous conversion funnel, Coulson said. Every step removed between the flight gate and the city increases the likelihood that travelers will leave the terminal and spend money locally. Fast connections, predictable baggage handling and clear wayfinding reduce perceived risk, while simplified transit visas make spontaneity possible.
A unified GCC tourist visa could unlock longer stays and multi-country itineraries, supported by investment in walkable districts, waterfronts and climate-smart design.
Taken together, the transformation of transit hubs into tourism powerhouses reflects a broader shift in how the Gulf approaches aviation-led growth. Airports are no longer just points of passage but economic gateways where short stopovers translate into tourism spending, jobs and long-term diversification.
