Sea-based economy; Production, employment and exports: A Multi-regional Computable General Equilibrium (CGE) Approach

Background and Theoretical Foundations:

 An ocean economy with a focus on enhancing social fairness and human well-being while lowering environmental dangers is known as a "water economy." In order to increase economic development, improve quality of life and employment opportunities, and maintain the health of ocean ecosystems, the term "water economy" is used. Iran has access to the sea, and by using these resources and potentials, it may move toward economic development and progress. Access to open waters, small and large islands, port cities with various commercial, fishing, touristic, and industrial functions, shipbuilding, maritime tourism, maritime transportation, underground resources, oil and gas mines, refineries, ports, piers, and marine structures, bunkering (fueling ships), and environmental activities are just a few of the potentials of the nation in the field of sea-based economy. The sea-oriented economy is one of the untapped development opportunities in the nation. Because the sea-oriented development and the sea economy have recently drawn more attention than in the past, it is important to paint a clear picture of them. In this study, an effort has been made to lay out the realities of the sea-based economy in the nation. The water economy, which has lately garnered increasing attention which is also addressed in the seventh development plan, may have an economic impact. Important economic sectors that are taken into account include aquaculture and maritime transport which has significant economic benefits for Iran. In light of this, the current study aims to identify these advantages. The primary research question is: What impact does emphasizing the sea-based economy have on welfare, changes in the nation's trade balance, and employment?

In this study, the economic effects of concentrating on the sea-based economy (aquaculture sector and maritime transport), due to the multi-regional calculable general equilibrium model (GTAP) and version 10 of its database, during 3 scenarios, 1. 100% reduction in rates Bilateral tariff of the two sectors of aquaculture and marine transportation, 2. Increasing the productivity of the workforce working in two sectors of aquaculture and marine transportation, and 3. Increasing the productivity of intermediate inputs in two sectors of aquaculture and marine transportation) was analyzed with GEMPACK software package.

The study's findings indicate that lowering the aquaculture sector's tariff will result in a decline in production volume, an improvement in Iran's welfare due to increased productivity of intermediate inputs used in both the aquaculture and marine transportation sectors, and an improvement in the trade balance between these two industries due to increased productivity of labor and intermediate inputs.

According to the research's findings, the most crucial policy advice for the nation is that marine transportation may be seen of as a viable choice. The findings of this study may assist the nation's planners and policy makers in adopting suitable investment and workforce training strategies, which would eventually result in higher economic growth and increased exports of this industry. Production may rise as a result of worker productivity and training in sea-oriented industries. Investment in sea-oriented industries is one of the factors that might affect productivity. Iran has a unique maritime edge; thus it is important to develop economic activity via domestic investment as well as by attracting outside investors. The capability of the private sector in the marine and port sectors was best used by the foreigner.