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The U.S.-Iran Memorandum of Understanding (MoU) may have lasted only a few weeks before collapsing back into open warfare, but for a moment, it offered a glimpse of what a lasting peace among Iran, the United States, Israel, and the wider region might actually look like.
What's notable about the MoU, and what sets it apart from prior U.S.-Iran peace efforts, is Trump's apparent belief that economics and business—not just traditional diplomacy—are the true keys to resolving long-running disputes. It is the same logic he has applied to Gaza, the Russia-Ukraine war, and now Lebanon.
Crucially, the MoU went beyond unfreezing Iranian assets and easing sanctions; it also laid out a $300 billion investment fund for Iran and its partners.
Only by creating prosperity, or the hope of it, will leaders buy into a peace process. That, at least, is the Trump view of the world. He sees himself as someone who understands business, and in his calculus, striking a business deal is simpler than negotiating an end to a decades-old conflict. But a business deal, even an imperfect one, might be exactly what breaks the ice for a longer-term peace.
This raises an interesting question: What are Iran's economic prospects if a peace process actually holds—and what would that mean for Iran's neighbors, including Türkiye?"
First things first: Iran's economy has shown remarkable resilience, surviving decades of sanctions and now war. And its skill, education, and innovation base is not to be underestimated—this is a country that has built a nuclear program, ballistic missiles and drone capabilities sophisticated enough to go toe-to-toe with the U.S. military. That kind of technical base suggests real economic potential once sanctions lift.
Iranians, by many accounts, place a high value on education. As is common under authoritarian regimes, when political expression is constrained, people often channel their ambitions elsewhere. In Iran, education and science have long served as that outlet.
The country has an incredibly well-educated and skilled population, which could form the basis of rapid growth and development once a lasting peace is achieved. Neighbors like Türkiye stand to benefit too, tapping into that science, innovation, and skills base for joint investment projects.
A Turkish industrial contact who recently visited Tehran told me he was struck by the scientific and technical capability he encountered there—in his case, in the medical field—and was genuinely excited about the prospects for future collaboration, assuming a peace deal holds.
Second, Iran's economic base is low. Gross domestic product (GDP) stands at around $360 billion, with a population of 93 million—putting per capita GDP at under $4,000, and likely lower still given the toll of war. But a peace that reopens Iran to trade, investment, and finance could plausibly triple that within a decade.
The comparison worth drawing is Poland after the collapse of communism. Its GDP roughly tripled within a decade of 1989 and has grown tenfold.
This could easily be Iran. For neighbors like Türkiye, with established manufacturing sectors, imagine the market and export potential there. Iranians would likely turn first to Türkiye to meet demand for consumer durables and basic goods. Current Turkish trade with Iran stands at under $6 billion—about a third of what Türkiye now trades with Poland, a country with a similarly sized economy and population.
Turkish companies are also likely to be first movers in a reopened Iranian market, much as they were in Iraq. Unlike many Western firms, they understand the region and its culture, and tend to have a higher risk tolerance for doing business there.
Third, within the Iran peace and recovery story, imagine the reconstruction needs—which will likely run into tens, if not hundreds, of billions of dollars. International development and financial institutions will likely be queuing up to distribute funding for roads, schools, and hospitals destroyed in the war. Therein, Turkish companies hold a clear advantage: proven experience in delivering large public investment projects on time and on budget across Türkiye, Iraq, the wider region, and Africa. Turkish companies could be at the front of the queue for these contracts.
Fourth, Iran holds 12% of global oil reserves—third only to Saudi Arabia and Venezuela—and possesses the right sort of oil: medium-light sour. It is also a vast country geographically, with immense potential reserves of other minerals, including critical minerals ripe for development. Consider the oil sector alone with access to capital, free markets, and development funds. Current oil production stands at around 2.3 million barrels per day (mbd)—down from 3.3 mbd just a year ago, and a fraction of its 1974 peak of 6 mbd. Yet over the next decade, Iran's potential could rival that of Saudi Arabia, Russia, or the U.S., reaching closer to 10 mbd.
The implications extend even further. A peace deal that stabilizes the region could boost energy investment across neighboring countries, including Iraq, leading to significant increases in its own production. Imagine the market impact if both Iran and Iraq scale up output: oil prices would drop—likely significantly—delivering a huge win for energy-guzzling Türkiye and its $50 billion annual energy import bill.
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Fifth, the broader regional benefits of a peace deal with Iran should not be underestimated. Proxy wars involving Iran play out across the region, in Iraq, Yemen, Lebanon, Syria, and beyond. Imagine a peace with Iran that also sees conflict in these countries moderate, and allows for a boom in investment and economic development. For a regional power and neighbor like Türkiye, this would present enormous economic gains through trade and investment. To an extent, this is already playing out in Syria.
Sixth, as peace, security, and economic development take hold across the region, migrant flows will likely decline. These flows have been hugely destabilizing across the region, serving as a primary driver for the rise of nationalism, populism, and fractious politics.
Seventh, peace, security, and economic development in Iran and the wider region will likely ease inter-ethnic tensions. In Türkiye specifically, this could help push forward progress toward a lasting Kurdish peace process.
Eighth, defense spending is rising globally, but nowhere more rapidly than in Europe and the Middle East due to heightened security risks. In many ways, defense spending is a drain on resources that could otherwise improve people's lives—funding housing, education, healthcare, and infrastructure instead.
If peace in Iran leads to broader regional security, defense budgets can be cut, freeing up funds for genuine economic development and tangible improvements in everyday life.
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