Iran's annual import demands could hit $200 billion by 2020 as the result of the removal of the US-engineered sanctions against the country.
Analysts say the UAE, Lebanon and Turkey remain best positioned to benefit from the upswing in Iran trade which, they say, will take place over the next few years.
The removal of Iran sanctions should also support South Caucasus via freer trade, but could have some negative spill-over impacts on Russia due to lower oil prices or eventual competition to supply gas to Europe, analysts at BofA Merrill Lynch Global Research have emphasized.
"Still, sustaining any boost in activity would require Iranian macro reforms," they have been quoted as saying in a report by UAE's The Khaleej Times.
As for the UAE, more foreign companies could be attracted to Dubai to do business in Iran, the report has quoted other analysts at the Institute of International Finance (IIF) as saying.
With a gross domestic product of $485 billion, Iran is the world's 18th largest economy by purchasing power parity, and is the second largest in the Middle East behind Saudi Arabia and trails only Egypt in terms of population. The gradual and partial removal of sanctions could help Iran's domestic demand rebound rapidly, especially if oil exports normalize to pre-2012 levels, The Khaleej Times report added.
"Our analysis suggests the Iranian economy would have matched the size of Saudi Arabia, were it not for sanctions. We think the deal is likely to bring macro benefits to Iran in three stages: cash, trade, and investment," said BofA Merrill Lynch.
The IIF observed that lifting the sanctions would spur a sharp economic recovery with a rise in oil exports, regained access to frozen foreign assets (estimated at about $100 billion), and sizeable foreign capital inflows, largely in the form of foreign direct investment.
Assuming implementation goes smoothly, growth could accelerate from about three per cent in 2015/16 to six per cent in fiscal years 2016/17 and 2017/18, driven by a surge in exports and private investment.
The fiscal deficit could narrow as oil revenues expand, and the spread between the official and the black market rates could be eliminated by end-2015. The authorities would have greater incentives to press ahead with reforms to improve the business environment to attract new foreign investors.