AFP: President Mahmoud Ahmadinejad’s economy minister on Sunday admitted Iran’s government had failed to control rampant inflation, which figures showed rose to 18.4 percent in the last Iranian year. TEHRAN (AFP) President Mahmoud Ahmadinejad’s economy minister on Sunday admitted Iran’s government had failed to control rampant inflation, which figures showed rose to 18.4 percent in the last Iranian year.
The comments by Economy and Finance Minister Davoud Danesh Jaafari — whose future has been the subject of frenzied press speculation — come amid charges Ahmadinejad has been stoking inflation with his expansionary economic policies.
“Despite a central bank report that the government performance in most economic areas has been positive, its plan to decrease inflation has not materialised,” Danesh Jaafari said, quoted by the official IRNA news agency.
The country’s year-on-year inflation rate rose to 18.4 percent in the Iranian year ending March 19, the central bank announced on Sunday. The comparable figure for the year earlier was 13.5 percent.
“The government failed to control inflation in the last (Iranian) year,” the minister said.
His stark comments contrast with statements by Ahmadinejad, who has repeatedly stated that the government is doing all it can to control price rises that are hitting the poor hardest.
Rumors have swirled on the front pages of Iranian newspapers over the past week that Danesh Jaafari was about to be sacked due to differences over policy with Ahmadinejad.
If he departed, it would be the seventh change to Ahmadinejad’s top economic team since he came to power in 2005.
But government spokesman Gholam Hossein Elham on Saturday denied the rumours as “a move to undermine and overshadow the government’s economic and monetary plans for the new (Iranian) year.”
Danesh Jafaari, who has never been seen as a natural ally of Ahmadinejad, was however unable to give a clear prediction over his future.
“In this government there have been rumours and sometimes they have become reality,” state television quoted him as saying.
“As economy minister, when I leave my office at the end of the day, I think it will be the last day. But in the morning when I come to work I think I will be giving service to the people for years.”
The minister has reportedly been at odds with the president over some of his most controversial decisions to kick-start the economy. Most notoriously, he was never informed of a 2007 decision by Ahmadinejad to cut interest rates.
Ahmadinejad was elected in 2005 on a platform of making the poor feel the benefits of Iran’s massive oil wealth and has made implementation of economic “justice” the main government slogan.
His opponents — both reformists and conservatives — have criticised him for stoking inflation by ploughing money into infrastructure projects promised on local trips, overnight decisions and handing out generous loans to the poor.
But the hardline president has repeatedly blamed external factors for high prices and vowed to bring fresh plans to change the economic situation in the new Iranian year.
Danesh Jaafari also sharply criticised the government’s promotion of the private sector, saying that “so far in this area the performance has been weak.”