Fearing impending crisis in Iran over the country's controversial nuclear program, many Iranian investors have chosen to reinvest their funds in more stable environments such as nearby United Arab Emirates.
Numerous analysts believe that Iran's already weak economy may face a bleak future despite soaring oil process, according to Gulf Daily News.
Iran's economy, which is state-dominated, is largely supported by its oils sales. However, Iranian leaders set their sites on lowering unemployment for many of the nation's youth, and strengthening the weak non-oil sector with the help of the nation's private sector.
However, such prospects are now dim; the recent vote by International Atomic Energy Agency to report Iran to the UN Security Council is expected to have devastating effects on Iran's private sector and economy.
"Investors have to feel secure, and now there are worries about the nuclear case," said one broker on Tehran's stock exchange.
The exchange experienced several years of strong growth before the recent nuclear controversy began surfacing.
"Before I used to handle up to 15 orders, at the moment I have one to deal with," one Iranian businessman said. "Clients are no longer willing or able to pay up front. If this continues, my money will go to Dubai," he added.
"For the past week, we've already seen a downward trend," said another trader, who noted the lack of liquidity in the market.
"The market has been in fear regarding the fate of our nuclear case. The case going to the UN Security Council will be a shock to the market," he added.
© 2006 Mena Report (www.menareport.com)
