Military tensions and the Iranian regime’s blockade of the Strait of Hormuz have pushed the livelihoods of people inside Iran into a critical phase. Reckless and adventurist actions in recent months have brought numerous severe economic and security consequences for the country.
Import Crisis and the Empty Tables of the People
The closure of international shipping routes has caused a sharp decline in the arrival of essential goods and raw materials at Iranian ports. By imposing a blockade at the mouth of the Gulf, the United States has completely halted the unloading of commercial vessels. According to official reports published by the state-run Donya-e-Eqtesad on August 1, commercial shipping traffic in the region has fallen to the lowest possible level. Traffic through the Strait of Hormuz has dropped to its lowest level in recent years.
Severe shortages of medicines and food products have placed additional pressure on low-income segments of society. Supply shortages have pushed food inflation above 70.5%, severely eroding household purchasing power. People’s tables are shrinking every day, while currency fluctuations have made basic food supplies increasingly unstable. Disruptions around the Strait of Hormuz have multiplied the transportation costs of imported goods.
The state-run Entekhab reported on July 28, citing the Central Bank, that the year-on-year inflation rate in July had exceeded 83%, while the year-on-year inflation rate for goods had reached 120%.
The state-run Fararu wrote that part of this inflation stems directly from shortages of imported goods caused by disruptions in the Strait of Hormuz and maritime borders. Economic experts say that only between 25% and 30% of the country’s trade can be conducted through land borders and the Caspian Sea, and at a much higher cost.
Missile Attacks on the Persian Gulf and Insecurity in the Strait of Hormuz
Drone and missile attacks on commercial vessels and Arab countries bordering the Persian Gulf have made a vital region insecure. According to reports published by the state-run Etemad Online on August 4, attacks on ships have complicated international negotiations. These hostile actions are doubling the risk of the war expanding and of direct confrontation. The closure of the Strait of Hormuz has not only harmed global trade.
Higher shipping insurance rates and the refusal of major companies to provide transit services have resulted in Iran’s complete economic isolation. Arab neighbors have also formed new defense alliances that are shifting the regional security balance against Tehran. Military adventurism has only intensified Iran’s international and regional isolation. Creating tensions in sensitive waterways such as the Strait of Hormuz has completely eliminated the country’s commercial security margin.
The Enormous Costs of Missile Programs and Political Isolation
Billion-dollar investments in nuclear projects and missile development over the past 48 years have brought not the slightest prosperity to the people of Iran. The regime’s proxy groups in the region have merely consumed the country’s vast financial resources and brought no tangible benefits to the people. Analytical reports in the state-run Tejaratnews, citing the World Bank, on June 14 indicate that global and regional inflation resulting from these adventurist policies is increasing. The crisis stemming from the situation in the Strait of Hormuz has intensified pressure on the domestic market.
Domestic and foreign investors, seeing the chronic insecurity, have withdrawn their capital from the country. Capital flight and severe stagnation have halted job creation for young people.
Using international waterways as a means of leverage has prompted a powerful military response from global powers. This isolation is the direct result of the irrational and adventurist policies of the governing institutions.
The experience of the past 48 years has demonstrated that the Iranian government lacks the capacity and will for genuine reform. Nuclear projects, missile programs, and support for proxy groups have not only failed to bring security but have destroyed the livelihoods and lives of the people. Creating crises in waterways, including the blockade of the Strait of Hormuz and confrontations with neighboring countries, demonstrates the futility of these policies as a whole. The only way out of this livelihood crisis and the danger of war is fundamental change and replacement with a democratic and secular government; a government that places people’s prosperity, peace, and livelihoods at the top of its policy priorities.
