Iran’s bankrupt economy will only get worse

Analysis by PMOI/MEK

Iran, June 30, 2021—Iran’s economy is worsening with each passing day. Even now, after several rounds of talks on reviving the 2015 nuclear deal, hopes have grown closer to despair, to the point that even government economists are talking about the need of major surgery for a dying economy.

“The issue of economics has been emphasized many times over the years, but really, why aren’t reform efforts taking place? The answer is clear, an emergency treatment cannot heal this wound, and the Iranian economy needs major surgery,” said the head of the regime’s Chamber of Commerce on June 24, according to the semi-official ISNA news agency.

“A study of the country’s economic situation in the second half of the 20th century shows a vicious and recurring cycle of mistakes that have resulted in problems such as inflation, rising unemployment, economic instability, persistent poverty, and high inequalities in our society, and from a macro perspective Iran’s economic growth in the last ten years has been almost zero,” he added.

He likens Iran’s economy to a “ruined wall” that many people paint and fix. However, due to the weakened foundations, the same ruined wall reappears repeatedly.

In general, any formal measure that takes place with the arrival of Ebrahim Raisi as president will not work.

In the past forty years, such measures have only led to brokerage, intermediation and rent and have created such instability in production that “in the morning, a producer who arrives at his production unit without knowing until the evening if the Central Bank, the Ministry of Industry or the Ministry of Economy will issue another directive in contrast to previous directives,” according to the Iran Chamber of Commerce, Industries, Mines and Agriculture on June 23.

Drought, a pretext for the import mafia

Iran’s agriculture is also controlled by the regime-linked mafia. “Drought has become an excuse for the import mafia to sacrifice national interests for their own interests,” said the head of the regime’s agricultural trade union according to a June 24 report posted by the Sabzine website.

“Currently, the supply and distribution of most livestock feed is limited to certain individuals and despite the fact that officials claim that the distribution of livestock feed is transparent, we are witnessing livestock feed imported with state-rate currency emerging from the free market, said the Managing Director of the Agricultural Cooperatives Trading Company. He attributed the decisions to a civil war waged by profiteers against domestic production,” according to a June 23 report wired by the semiofficial ILNA news agency.

The regime-dominated economy is in a coma

Hamid Asefi, an expert on international affairs, has interesting remarks on the regime’s polluted economy. “Iran must forgo ambitious objectives if it wants to have a successful economy. While under sanctions, China could not circumvent such measures either. Given that in China we have about $20 billion in oil money, frozen due to the FATF and sanctions, … and we can only import Chinese goods,” he explained, according to the Eghtesadepooya website on June 26.

 “The period when sanctions were imposed showed that Iran’s economy would be paralyzed without a connection to the outside world. We might make money through smuggling, but as they used to say, smuggling is like stolen property. Stolen property can be bought for free. For example, if oil is selling at $60 on the global market, we would sell it for $40, with all the risks it had,” he added.

73 percent of bank loans are for 500 families

Plundering by regime-linked individuals and circles has become so obvious that its signs and statistics have spread from election debates to the state media acknowledging that “Iran’s economy is on the edge of a cliff.”

Atta Bahrami, a government economist, sheds light on the influence of banks and crises created by the country’s banking system.

“Lawlessness is rampant in our money market. The chaos seen in the Iranian banking system does not exist and is not seen in Western banks. Due to this lawlessness, banks provide loans to their members, spend their deposits on their corporations, and, because they cannot repay the installments and money, take new money from the central bank, which has led to increased money printing and inflation. The money and support that the Central Bank provides to the banks is a betrayal and a crime against the people. It is an obvious theft from the people’s pocket in broad daylight! … While people try desperately for weeks for a loan of 20 million rials (about $80), some are receiving two trillion rials (about $80 million) with just one phone call! This oppression, according to statistics, reveals that 95 percent of the deposits are in the hands of less than ten percent of the people. Following the 1979 revolution, 73 percent of the loans provided by the banking system have been to only 500 families!” according to the Khabarpu website on June 24.

Regime officials themselves are acknowledging the betrayal and crimes against the people, and the need for major surgery is also strongly recommended by the regime’s own experts. The result of more than four decades of the regime’s rule, according to government officials, has been nothing but over 60 million Iranians now living in poverty.

You May Also Like