International Sanctions and Iran’s Free Trade Zones; Case Study: Kish Free Trade Zone

The establishment of international financial institutions; the creation of cross-border free zones with target countries; the targeted attraction of foreign investors to stabilize international relations; the gradual integration of the national economy into the global economy; and the formation of regional supply chains with target countries constitute some of the most important objectives behind the establishment of free trade zones in Iran. In this context, the development of these zones and the enhancement of their cooperation with neighboring countries have been among the key dimensions and objectives of Iran’s economic diplomacy. According to national strategic development documents, approximately 20 countries have been designated as target and neighboring countries for Iran’s seven active free trade zones. The main objective of the present study is to analyze the role of free trade zones in Iran’s economic diplomacy policymaking, with a specific focus on the Kish Free Trade Zone in the context of international sanctions imposed on Iran. The central research question is: How has the Kish Free Trade Zone contributed to the development of Iran’s economic diplomacy under conditions of international sanctions? Drawing on the theory of neomercantilism, the study tests the hypothesis that, contrary to the original philosophy behind its establishment, the Kish Free Trade Zone failed to achieve the expected indicators of economic growth in line with the stated macro-level objectives during the period 1391–1403, when international sanctions were intensified. This research is applied in nature and adopts a qualitative methodology based on a critical approach. To test the hypothesis, documentary data and content analysis of news reports were employed, alongside semi-structured interviews with local experts and managers. The findings indicate that the capacities of the Kish Free Trade Zone did not effectively contribute to the advancement of Iran’s economic diplomacy and were unsuccessful in fulfilling their primary roles or in revising and implementing feasible objectives under sanction conditions.