Internet outage puts pressure on Iran’s digital economy despite easing restrictions

The Iranian economy is witnessing increasing repercussions as a result ofInternet outagesfor long periods, in light of restrictions imposed by the authorities during recent months against the backdrop of security and political developments. As this outage entered its third month, the government began taking partial steps to ease restrictions, especially on companies, in an attempt to limit the escalating economic losses.

In light of the increasing reliance on the digital infrastructure to support and sustain economic activities, the impact of Internet outages becomes a pressing factor on growth and development paths, especially in sectors related to the modern economy. It also intersects with sustainable development and its goals, especially with regard to economic growth (Goal 8) and infrastructure (Goal 9).

In this sense, this article reviews the repercussions of this interruption on the digital economy in Iran, in addition to reviewing the most prominent government measures to deal with the crisis and its effects on the labor market.

Internet outage and its impact on the digital economy

Internet outage in Iran has led to widespread disruption of economic activities, especially those related to the digital economy, which relies primarily on continuous connectivity to the global network. Multiple sectors have been affected, from e-commerce to digital services and self-employment, leading to a decline in productivity and the disruption of work chains.

This situation also reflects the fragility of reliance on digital infrastructure in the absence of stable communication, as the Internet is no longer just a means of communication, it has become a pivotal element in business management and achieving economic growth.

Easing restrictions via “Internet Pro” to support companies

In an attempt to mitigate the repercussions of the Internet outage, Iranian authorities approved a temporary system known as “Internet Pro,” allowing companies to access the global Internet with fewer restrictions. This measure aims to support business continuity under the current circumstances, especially for sectors that depend on external communication.

However, this solution remains limited, as it does not include all users, but rather is limited to companies, which creates a gap in access to digital services between institutions and individuals. In light of this disparity in access to the Internet, the economic repercussions of the outage began to appear more clearly, with increasing losses recorded across various sectors.

Increasing economic losses as a result of Internet outages

Estimations reveal the size of the losses resulting from the Internet outage, with direct daily losses ranging between 30 and 40 million dollars, while they may reach about 80 million dollars when indirect effects are taken into account. These numbers reflect the significant impact of the outage on the economy, especially in light of the dependence of large sectors on digital communication.

These losses are not limited to large companies, as they extend to small and medium enterprises, which represent an important part of the economy and rely heavily on digital platforms to market their products and services.

The impact of Internet outages on individuals and the labor market

The impact of Internet outages extends to individuals, especially those working in the digital economy, such as freelancers and small business owners, who rely on the Internet as a main source of income. The interruption led to the loss of many jobs and a decline in job opportunities, in light of the difficulty of communicating with foreign markets.

This was also reflected in the standard of living, with rising prices and a decline in economic activity, which increases pressure on families and affects social stability. In light of these economic and social repercussions, the challenge arises for the authorities to achieve a balance between security requirements and maintaining the stability of economic activity.

The balance between security and economics in Internet governance

These measures reflect an attempt by the government to achieve a balance between security requirements and economic pressures, as the authorities believe that the restrictions are necessary in light of the current conditions, while the economic losses impose the need to partially ease them. In this context, Internet outages represent a complex challenge, as it is difficult to achieve a sustainable balance between security and economic considerations, especially in light of the increasing dependence on the digital economy.

The continued Internet outage also raises questions about the future of the digital economy in Iran, and the extent of its ability to recover in light of these restrictions. It also highlights the need to develop a more flexible digital infrastructure capable of confronting crises without completely disrupting economic activities. This reflects the importance of integrating digital stability into economic policy priorities, which contributes to supporting growth and achieving Sustainable Development Goals (SDGs), especially Goal 16: Peace, justice, and strong institutions.

In the end, the Internet outage in Iran confirms that digital communication has become an indispensable infrastructure in the modern economy. As its effects escalate, there is a need for balanced policies that ensure the continuity of economic activity, without prejudice to security considerations.

In this context,The Earth Guards Foundationhighlights the necessity of enhancing the sustainability of digital infrastructure and the necessary step it represents to support modern economies, thus contributing to achieving a balance between economic growth and stability in the face of crises.