Home Blog Page 256

Iran’s Economy Worsens As the Government Continues To Plunder National Wealth

Jubin Katiraie
-
0
Iran’s Economy Worsens As the Government Continues To Plunder National Wealth

The current economic situation in Iran is the worse one that the country has experienced in the last century. With the Iranian regime’s new president, Ebrahim Raisi, and his administration promising that they will resolve Iran’s crises, the question remains as to whether they will be able to.

Iran’s economy has long been monopolized by Khamenei and the Revolutionary Guards (IRGC). But Raisi’s administration is full of IRGC commanders and Khamenei’s inner circle men whose main task is to plunder Iran’s national wealth and prolong the regime’s life.

When Raisi announced the nominees for his cabinet following his inauguration, Iranian dissidents described the chosen candidates as the embodiment of four decades of the religious and terrorist dictatorship of the mullahs, whose mission is to counter popular uprisings, plunder national wealth and resources, step up terrorism and warmongering, and expand the unpatriotic nuclear and missiles projects.

Khamenei has also handpicked the regime’s parliament and put one of his closest officials and a corrupted element, Mohammad Bagher Ghalibaf, as the parliament’s speaker. As the mayor of Tehran, Ghalibaf is accused of stealing over billions of dollars.

Ghalibaf formerly served as one of the top commanders in the IRGC and was later succeeded by Alireza Zakani, another IRGC commander who is close to Khamenei. The IRGC is notorious for using its headquarters and ‘front’ companies to plunder the nation’s wealth, with their top corrupt organization being the Khatam al-Anbiya Construction Headquarters.

This company began as an industrial and construction contractor in 1989, with the goal of the organization to “efficiently utilize the available construction and economic resources, capacities and talents of the IRGC to continue the Islamic Revolution.”

The Khatam Headquarters contracting services acts as a huge intermediary between the government and small engineering and technical companies, which have a major portion of their revenues seized by Khatam. Ownership of many of these companies occurred unilaterally or through intimidation and force.

Back in September 2019, former government minister, Behzad Nabavi explained that in Iran, 60% of the national wealth is controlled by four main institutions, which are the Executive Headquarters of Imam Khomeini’s Directive (Setad), Khatam al-Anbiya Base, Astan-e Quds, and the Foundation of the Oppressed and Disabled.

Between 2007 and 2011, the current Minister of Urban and Road Development in Raisi’s cabinet, Rostam Ghasemi, served as the commander of Khatam al-Anbiya, before becoming the Minister of Oil in then-president Mahmoud Ahmadinejad’s administration between 2011 and 2013. During his service, financial irregularities, cases of embezzlement and bribery, as well as other financial crimes, all took place.

These facts highlight once again that Ebrahim Raisi and his ilk are not going to solve Iran’s economic problems. Iran’s state media also confirmed the latter on Tuesday.

The state-run Hamdeli daily wrote on October 19 that the Iranian economy has yet to change following Raisi’s inauguration. The worst problem faced by the Iranian people is the rising inflation rates which are directly affecting their lives.

Daily protests are taking place across Iran, attended by people from all walks of life as the worsening crises are turning society into a powder keg. The frustration and restiveness are set to grow even more if the regime is still reluctant to find solutions.

They have realized that Raisi’s hollow promises are part of the regime’s deceptive measures to postpone another major uprising. The regime’s ongoing corruption and its devastating effects on people’s lives have indeed created a danger towards the regime.

Political Corruption in Iran, Increasing Number of Secret Parliament Sessions

Jubin Katiraie
-
0
Political Corruption in Iran, Increasing Number of Secret Parliament Sessions

With the presence of the Iranian regime’s new government, which has become a collection of the most vicious elements of this regime from its new president Ebrahim Raisi, who is infamous as the butcher of Tehran, to the new appointments of the new ministers who are mostly chosen from the Revolutionary Guards (IRGC), something strange is happening which is not unexpected.

The number of secret sessions of the 11th parliament is increasing day by day. From budget to foreign policy and even pricing for steel is all behind closed doors. Only three closed-door meetings have been held in the last two weeks.

And all this happens in a parliament that has come to power from the very beginning with the claim of being crystal clear and to fight government corruption. The situation has become so bad that even the regime’s MPs have raised their voices against it.

According to Article 69 of the regime’s constitution, parliamentary negotiations should be made public, and the full report should be made public through the official radio and newspaper, and only in an emergency, if the country’s security is in danger, a closed session will be held at the request of the President or one of the ministers or 10 representatives.

But these days, the circle of secret sessions seems to be constantly expanding. From the pre-review meetings of the vote of confidence and financial proximity of the proposed Minister of Petroleum to even the plan to protect the rights of users in cyberspace to the review of the 2021 budget with the presence of the head of the Planning and Budget Organization, the subtraction of the 2020 budget with the presence of Mehrdad Bazrpash, the head of the Audit Court and even the approval of the Judicial Commission on the confidentiality of the officials’ property are all held in secrecy and behind closed doors and the people are not aware what is going in the regime’s parliament.

This governing parliament whose members mostly stem from the regime’s principlist faction has started its work with the slogan of transparency and one of its claims was the transparency of delegates’ votes, a fake plan that is announced every week but has been never implemented.

The question is what does the regime fear that it is implementing so many secret sessions?

Last week, a closed-door meeting with the head of the Planning and Budget Organization about next year’s budget was held. Regime’s MPs later presented a report on the contents of the closed-door meeting, but ultimately it was not clear why the budget meeting should be held in secret.

At the same time, one of the MP’s reported a 50 percent budget deficit, probably one of the reasons for the secret meeting, which is indicating the regime’s extreme critical situation.

After that, the 2020 budget subtraction session was held in secret. Observers believe the closed-door natures of the session were to hide the corruption and waste of the country’s resources by the regime.

At the time of the vote of confidence in the cabinet, parliament held two closed sessions, one before a closed-door vote of confidence, and one at the same time examining Elias Naderan’s claims about some financial issues raised about Javad Oji, the option for the Oil Ministry, where parliament held a brief closed session.

Naderan had said in an open meeting of the vote of confidence that, given the inquiry I got from the competent authorities, it became clear that Oji had nine (private) possessions, so one should think about someone who says so explicitly contrary. It was then that, at the request of the 11th Parliamentarians, a closed-door hearing was held to investigate Naderan’s claims.

Parliament held a closed-door meeting with the head of the IRGC Qods Force Esmail Qaani after the events in Afghanistan and the Taliban came to power. The plan to protect the rights of users in cyberspace was also held behind closed doors which were held to vote for the withdrawal of the plan from article 85 and did not vote in the second time in open session. Therefore, the plan to protect the rights of users in cyberspace following Article 85 of the Joint Commission will be secretly approved and implemented.

Parliament has even held closed sessions for steel pricing. Last year, a spokesman for the Parliamentary Board of Directors announced an hour-long closed-door meeting on issues of the Ministry of Industry, Mine, and Trade. At that meeting, the Ministry of Industry, Mine, and Trade’s plan for steel pricing was reviewed.

The last one, about the desire for confidentiality, which has manifested itself in the parliament’s resolutions, was the approval of the Parliamentary Judiciary Commission on the non-publication of the authorities’ property.

The answer to the previous question that what the regime is fearing most in this period is simple: the regime is facing a fragile security situation, therefore it is forced to hide its weaknesses from others, especially the people. The regime understands soon or later it will face massive protests like November 2019, therefore it is hopelessly doing everything to delay such events.

Protests Will Only Expand As Iran’s Economic Conditions Worsen

Esmaeil Mohades
-
0
Protests Will Only Expand As Iran’s Economic Conditions Worsen

As the economic conditions in Iran worsen day by day, Iranian citizens, young and old, from across the country are standing together in protests of the Iranian regime’s mismanagement of the current crises. As a result, the Iranian state media have been warning of the possibility of a nationwide uprising starting.

The Mostaghel newspaper discussed in their publication on Sunday how critical the state of the living conditions of the Iranian people is. Among those most affected are Iran’s teachers who began the academic year protesting for their most basic needs. The newspaper warned that if the regime does not step in to rectify the problems faced by the teachers, the protests will only get worse.

Since last year, Iran’s teachers have been raising their grievances with government officials, but the regime has refrained from addressing their demands. As the start of the academic year neared, the teachers returned to the streets to resume their protests and remind the government of its duties.

The Mostaghel daily said, “The economic class gap, as well as the gap between salaries, have caused these protests and livelihood demands to become highlighted among teachers.”

Currently, in Iran, the poverty line sits at a monthly income of 120 million rials (around $437), but many teachers are failing to receive even half of this amount and must face many delays in receiving their salaries.

Due to the extreme poverty that these teachers are facing, many have been left unable to afford even the most basic needs like food or shelter, which has driven many teachers to commit suicide.

In the past month, security forces have cracked down on the teachers’ protest rallies on several occasions, beating and arresting demonstrators. But the protests continue, and in addition to their economic demands, the teachers are now also chanting slogans to release imprisoned teachers.

Mostaghel explained how even with the security force crackdowns, the protest rallies will continue regardless of if the problems are not solved.

Another article in their newspaper on Monday discussed the gap that has widened between ordinary Iranian citizens and the ruling elite and stated that the state of the crises in Iran should be a warning for the regime authorities.

The article read, “In circumstances that the country’s production is in its weakest condition, a large part of the liquidity has been channeled into profiteering from currency and coin exchange, and many workers have lost their jobs, should a small group of people live in extreme luxury?”

In speaking of the last large uprising in Iran, that took place in November 2019, of which the regime was brought to the verge of collapse, Mostaghel explained that the events of that time did nothing to change how Iran’s economic system is governed. They explained that the Iranian people can only tolerate so much, and once that threshold has been reached, the powder keg in society will explode.

Mostaghel said, “The news about social problems, and the shrinking of the people’s tablecloth, and the disappearance of items such as meat and poultry from their meals is a countdown and an alarm.”

Iran: Countdown and Alarm of Youth and Hunger People’s Riots

Hoshang Amiri
-
0
Iran: Countdown and Alarm of Youth and Hunger People’s Riots

“What the Ministry of Energy (i.e., Iran’s regime) has done to the people of my region, Genghis Khan did not do to Iran.”

No! Make no mistake! ‌ These are not the words of an Iranian dissident. The tragedy is so vast and deep that it has been expressed even by the regime’s officials and elements.

Referring to the performance of the regime’s Ministry of Energy in Chabahar, the lawmaker from this city, Moinuddin Saeedi, said: “What the Ministry of Energy has done to the people of my region, Genghis Khan did not do to Iran.”

The state-run website Rouydad 24, quoting this representative, who spoke about the dire situation in Sistan and Baluchestan province, especially in the south, and wrote: “For example, the village of Kamp, which is the largest village in the country, 5 km from Chabahar Free Zone, does not have even one meter of water piping.

“Therefore, the suffering of the people cannot be denied or ignored, because they have robbed the dreams and aspirations from the children of Sistan and Baluchestan. These are not things that can be erased or not seen.”

Moinuddin continued: “The information they give about the fuel porters of Sistan and Baluchistan is incorrect. Because most of this is organized in a way that people are not involved in, but when they want to deal with it, they have nothing to do with organized smuggle and they deal with the people.”

What this lawmaker is referring to is the organized smuggling of fuel by the regime’s Revolutionary Guards (IRGC) forces which have been implemented with the pretext of the so-called “Razagh” plan and are smuggling fuel to Pakistan.

The remarks of this MP indicate the explosive situation in Sistan and Baluchistan province. People who are deprived of the minimum of life. Their children do not have a birth certificate, school, place to play, and even drink water. Baloch children do not have something that is called childhood in other countries. From the very beginning of life, they become familiar with the concept of pain and hunger and forget even fun and smiling.

Comparing the performance of the regime’s ministry with the Mongol invasion shows the intensity of the protest and anger that exists in that province and the MP’s fear that the situation would get out of control, which has forced him to acknowledge this fact in this way, even knowing that it may have consequences for him.

This situation is what state media are warning about on a daily basis. The state-run daily Mostaghel on October 18, 2021, wrote:

“We must prevent phenomena such as the riots of the unemployed and the hungry. The shrinking capacity of Iran’s economy, and consequently unemployment and inflation, and ultimately the shrinking of people’s baskets, is a warning to the country’s economic and political authorities. While the country’s manufacturing sector is at its weakest and much of the liquidity has gone towards currency and coin business, and many workers have become unemployed, a limited stratum still lives in prosperity.”

No doubt that this ‘limited strata’ which is living in prosperity are the regime’s officials and elements.

This daily recalled the November 2019 protests and warned the regime:

“Even the events of November did not cause a change in attitude in the way of governance or reform the country’s economic system. The resilience of young people and dissatisfied strata is limited, from that stage onwards, this group no longer sees any reason to remain silent and react. News of social damage, as well as reports of shrinking people’s baskets and the elimination of things like meat and poultry, are like a countdown and alarm.”

Poverty Level in Iran Is So Severe, It Has Encompassed the Middle Class

Sia Rajabi
-
0
Poverty Level in Iran Is So Severe, It Has Encompassed the Middle Class

With the state of the economy in Iran, it is no wonder that more and more people have fallen into poverty in the past few years, with more than 80% of Iranians living under the poverty line. As a result, the middle class has all but disappeared as the poverty line level has risen.

Under the rule of the Iranian regime, people have lost their homes and had to resort to sleeping where they can, from empty graves and ditches to rooftops or abandoned refrigerators. All the while, the regime officials are doing nothing to remedy this social crisis.

According to the state-run Jahan-e Sanat on August 9, official reports indicate the living conditions of all sectors of society have deteriorated.

The daily explained how the poverty line has increased by 38% in just two years due to the rising inflation in the cost of food and housing. They said, “Considering the living conditions of households in the last decade, it is clear that the growth rate of poverty has been faster than the growth rate of wages in all years, and the wage gap and poverty line reached 145% by the end of the 2010s.”

They also predicted that considering the current trajectory, due to the rising inflation rates and low incomes, more households will be set to fall below the poverty line in the next year.

Among all sectors of society, Iranian workers endure more pressure due to the regime’s anti-labor policies.

The ILNA News Agency reported in August that there is now a gap between living expenses and the wages of workers of 6 million Tomans. Families are struggling to provide even basic food staples like protein and dairy. They compared the Iranian situation to Venezuela where the economy is completely bankrupt and said that if the regime cannot rectify the problems in Iran, “the devaluation of the national currency, inflation, unemployment, etc., will be greater than now.”

Iran has one of the largest gas reserves in the world, just behind Russia, with over 150,000 million barrels of oil reserves. They are also in the higher ranks among countries with major mineral resources, with over seven percent of the world’s mineral resources, despite only accounting for one percent of the world population, according to a study by the regime’s Islamic Parliament Research Center.

But despite all its riches, more than 80 percent of the nation lives below the poverty line, and the middle class has essentially disappeared.

Of the estimated 85 million people living in Iran, 19 million Iranians have been forced to live in slums, and 7.4 million children have been deprived of their education due to the extreme levels of poverty. A quarter of the Iranian youth are currently unemployed and 75% of economic capabilities have been lost by workers. Shockingly, up to 1,000 children under the age of 3 are abandoned on a yearly basis as their parents cannot afford to raise them.

The most worrying consequence of the widespread poverty in Iran is that more and more people are willingly selling their organs to make much-needed money, with some mothers even selling their unborn fetuses to make ends meet.

The poverty in Iran is having a detrimental effect on society with millions suffering due to the mismanagement of the regime and the lack of the officials’ using money where it is most needed. According to the regime’s own figures, Iran’s income from oil exports is around $66 billion, while non-oil exports equate to $32.3 billion.

The regime continues to expand budgets allocated for meddling in Middle East countries, boosting its nuclear and ballistic missile drives, and launching dozens of military and security forces imposing an intense atmosphere of an internal crackdown.

500,000 Unemployed Engineers, While China Builds Housing in Iran

Pooya Stone
-
0
500,000 Unemployed Engineers, While China Builds Housing in Iran

Since mid-2019 and especially since spring 2020, along with the increase in housing prices and building materials, Iran is witnessing an increase in the cost of construction so that under the influence of this situation, the construction industry has been seen a huge recession and in recent months it is making many people hopeless to having a roof over their heads.

The new government has promised to build one million housing each year which has been criticized by many officials as a hollow promise due to the country’s bad economic situation.

But one news that has shocked many people about the housing situation is the government’s negotiations which the Chinese use of the country’s constructing industry.

Something that even many of the regime’s officials are complaining about it. In an interview Eghbal Shakeri, a member of the parliament’s Civil Commission said:

“In a recent meeting with the commission members, the Minister of Roads and Urban Development announced this issue and did not provide details about it, but it is not exclusive to Chinese companies, and companies with the technology of other countries can participate in the construction of Iranian housing under the condition of technology transfer. Shakeri stressed: ‘Technology transfer is the main condition for agreeing to the presence of foreigners in Iran’s construction.’”

Amazingly, on the question of why the government is not using Iranian constructions firms and engineers with the help of the world updated technologies Iraj Rahbar the Vice President of The Association of Mass Builders of Tehran Province answered:

“Unfortunately, the Minister of Roads and Urban Development does not have enough information about domestic facilities and capabilities in the construction industry.”

The question is, why then has the regime put someone at the helm of such an industry when he is not informed about the country’s construction capabilities?

The painful part is that now according to the expressions of some of the country’s experts, Iran has more than 500 thousand engineers, while many of them are unemployed and the government is insisting to use foreign engineers in different parts of the country’s industry which is raising the skepticism about corruption.

The damage is in projects like the Tehran-North Freeway project the regime used Chinese companies, and now after 20 years this project is being left unfinished and these companies have left the country.

Other effects which are hurting the country’s economy is that technologies for this field have been imported from aboard while the country owns the same power, and this is causing an increase in unemployment and many of the producers of these technologies in the field of the urban construction are forced to export their production to other countries like Iraq having no costumer inside the country.

Another sad thing is while training engineers are putting a huge amount of expenses on any country, Iran has one of the highest numbers of brain drain.

This situation raises doubts more than ever about president Ebrahim Raisi’s decision to construct one million housing units in one year.

Protests Held in Ahvaz and Isfahan by Frustrated Retirees and Pensioners

Hoshang Amiri
-
0
Protests Held in Ahvaz and Isfahan by Frustrated Retirees and Pensioners

As the social and economic crises continue to ravage Iran, in the cities of Ahvaz and Isfahan groups of retirees and pensions took to the streets to hold protest rallies on Sunday. The demonstrations were regarding the poor living conditions they are facing, as well as low wages and the lack of response from the Iranian regime to their demands.

Protests have taken place in various cities across Iran in recent months, but regime officials continue to avoid addressing the demands of the pensioners. The main issue faced by the protesters is that the meager pensions that they receive barely cover even the most basic living expenses, and their payments are often delayed for several months at a time, leaving the men and women struggling to survive in a country swimming in poverty.

The decline in Iran’s economy, spurred by government corruption and destructive policies, has plunged the lives of many pensioners and retired government workers into utter poverty. The rial, Iran’s national currency, has seen a huge dip in the past few years, losing more than 80 percent of its value.

As a result, the prices of basic goods have skyrocketed while the pensions and salaries of Iranian citizens have not been altered to match the rising inflation in such a damaged economy. This has in turn caused many pensioners to fall under the poverty line. The refusal to adjust pensions to fit the inflation rates is surprisingly going against the Iranian government’s own policies.

A census taken in 2020, identified that there are 18 million pensioners living in Iran. Due to the hardships that they are facing, they are part of the 96% of the Iranian population who currently live under the poverty line. Even the regime’s own statistics have identified that more than 75% of these pensioners are struggling to provide for their most basic needs.

Pensioners receive on average 25 million rials per month while the poverty line in some parts of Iran has reached 100 million rials in the past year.

Years ago in Iran, the class divide was more apparent, and the poverty line was clearly defined. These days, the poverty line has risen sharply and now encompasses the middle class of Iranian society. As the country’s crises continue to wreak havoc on people’s lives, and the inflations rates show no sign of slowing, it begs the question as to how much further the poverty line will grow.

In recent days, another protest rally took place in front of the Majlis (parliament) in Tehran. A group of users of the Cryptoland online market gathered to demand that their stolen investments should be returned to them.

The users of Cryptoland have been holding protests for several months, but authorities are refraining from acting on their demands. Cryptoland had around 289,000 users, who have lost a collective $200 billion worth of savings in the online marketplace.

Children Fall Victim to Iran’s Middle Age Law

Sia Rajabi
-
0
Children Fall Victim to Iran’s Middle Age Law

In the first half of this year, 791 babies were born in Iran to mothers who are themselves children and are under the age of 14, indicating that the violation of the rights of children, one of whom is a child marriage is continuing in Iran under the extreme reactionary rules of the mullahs, due to economic poverty or cultural poverty, children are losing their normal childhood and are in physical and mental dangers.

“Mr. Raisi! Stop the motherhood of children”, is the title of a recent article published by Iran’s state-run daily Etelaat about girl children who have become mothers at a very young age.

According to the National Organization for Civil Registration of Iran, the age of mothers who gave birth to these babies in the first half of this year was between 10 and 14 years old. In other words, it is sad to say that Iran has girls who have had children at the age of 10, which they should have been studying and proceeding with a normal life.

This is not the whole story. The report of the Civil Registration Organization adds that in the same period (i.e., from March 20, 2020, to October 7, 2021), 36,562 children were born to mothers aged 15 to 19, of which 18,922 were boys and 17,640 were girls.

Hearing shocking news from Iran has become an ordinary thing and people who are following the situation should be aware not to get used to it. But some news is so devastating that if someone does not take any position on it, it will definitely hurt our dignity.

No common sense or awakening conscience would accept such oppression of children. Naturally, the government, as the large and powerful institution of any country, must enter this crime that is influenced by any social, economic, or cultural issue on children and prevent its continuation by adopting diverse policies and methods, but Iran that is captured by the mullahs is an exception who have no respect to any kind of human rights, let alone the rights of children.

The main culprit of such a situation is the regime’s ridiculous and inhuman laws, observers say. Article 1041 of the Civil Code states that ‘the marriage of a girl under the age of 13 and a boy under 15 is subject to the recognition of the interests of the couples, the permission of their guardians, and the recognition of the court’, according to which, first, the marriage of girls from the age of 13 is immediately free, and secondly, at the age of less than 13, she is also free under the conditions that can be obtained.

The bill to amend this article and change the age of marriage for girls from 13 to 16 has been submitted by the government for nearly seven years but is still under consideration and has reached no point. Just as the child protection bill has reached nothing. Not surprising under the rules of the mullahs.

The shameful argument of the opponents to this bill is that, if in some urban areas the age of marriage for girls is over 25 and even 30 years, allowing children to marry can lower the age of marriage.

According to last year’s statistics, in Iran, more than 9,000 children aged 13 and under are married, and according to the statistics, divorce rates in these marriages are higher than divorces in all age groups, and according to a regime’s official, the country is now facing with the phenomenon of widowed children.

The violation of children’s rights besides the destruction of women’s and girls’ rights has different forms in Iran. Another example of this violation is the murder of children by the father, who has a very light punishment because his father is the guardian, and this, unfortunately, has fueled these crimes.

After the murder of 14-year-old Taleshi girl Romina Ashrafi, who was killed by her father on May 21, 2020, the head of the judiciary at the time (the regime’s current president) announced that the punishment for fathers who murdered their children would be intensified to such an extent that it would be deterred.

Although the regime can impose such punishments, this has not happened so far, informing that all the regime’s promises are worthless.

The ‘obligatory education’ for children is another child’s right that is not respected. There are numerous statistics of children dropout education, the lowest of which is about 200,000 according to the regime’s numbers. A look at the crossroads of major cities and working children shows that a considerable number of children are out of school.

Iran’s Government Unable To Compensate Investment Backwardness Even in Two Decades

Jubin Katiraie
-
0
Iran’s Government Unable To Compensate Investment Backwardness Even in Two Decades

What has been reported by the Iranian government’s statistical institutions speaks about the government’s failure to attract foreign countries and economic entities to invest in Iran. An opportunity that is now not imaginable anymore due to the regime’s insistence on its nuclear and terror activities.

The decrease of real investment, and the decrease of countries that desire to invest in Iran, and the increase of the macroeconomic variables such as the monetary base, liquidity, and most important the inflation are adding to this crisis.

According to the report of Iran’s Deputy of Economic Studies of the Chamber of Commerce in the 2000s, the average annual growth of investment was -4.7 percent, and the amount of a real investment was just 171 trillion tomans. This number in 2011 this the amount of investment reached 100 trillion which decreased to 98 trillion tomans in 2019.

To understand the loss for the Iranian government, it is enough to know that the total operating deficit of the 2020 budget released by the Supreme Audit Court on Tuesday was 183.3 trillion tomans, while the country’s total real investment that year accounted for only 54 percent of the operating deficit.

The continuation of this trend can be more destructive in the coming years. To compensate its shortcomings, the most important of which is the construction of power plants for electricity supply, the government needs a huge amount of investment which it doesn’t seem able to fund at least until the 5-year horizon.

Because of the regime’s nuclear crisis and the return of the regime’s oil sanctions, which have damaged the country’s uniaxial economy, the situation of the country’s investments become critical so that in addition to the decrease of the investment, the annual investment growth fall to -6.8 percent and the capital formation become negative.

Therefore, government economists call this decade the worst in Iran’s economic history, and many of them speak about an ‘unreversible crisis’ because nothing is predictable and is indeterminate and the situation has reached a state of uncertainty.

This situation has now led to the increase of the prices in the asset market and the lack of investments even by the country’s people. The people instead of investing, attended in parallel markets like currency and gold to avoid a sharp devaluation of their currency.

In addition to this crisis and parallel to it welfare fall rapidly in the society and the Gini coefficient exceeds 0.4 in 2018-2020 which is a sign of the increase of the class gap in the society.

The government respectively was forced to borrow huge amounts from the national bank to cover their budget deficit, which hurts the future generation of the country, losing their resources to invest in the development.

According to central bank reports, by March 2020, liquidity reached 3476 trillion tomans, an increase of 40.6 percent compared to March 2019 and an 84 percent increase compared to March 2018.

Liquidity was reported at the end of 2019 and 2018 at 2472 trillion tomans and 1882 trillion tomans, respectively.

To understand the magnitude of the numbers of economic variables in the 2000s, it is enough to know that the base volume of money in 2019 was about 352 trillion tomans.

According to the Tehran Chamber of Commerce’s deputy for review, assuming an annual growth of 5 percent of investments from this year in 2034, the country’s real investment will reach the figure of what it was in 2011, 170 trillion tomans.

And that is only if the regime becomes successful in the nuclear negotiations and be able to remove all the obstacles and sanctions which many of which are not related to its nuclear case, then it must witness a 10 percent increase of investment annually.

Meanwhile, other economic variables like monetary base, liquidity, and inflation will continue their path and these variables will not change positively and will challenge a real investment in the country’s economy.

Also lurking in Iran’s economy is the depreciation of capital. From the beginning of 2011 until 2017 the real investment was much higher than the depreciation of capital and the investments were able to cover the depreciation of capital. However, since 2018 this decreased suddenly and became equal to the depreciation of capital.

It should be noted that the depreciation rate with steep stability was increasing every year, but the amount of investment declined with a steep slope. So that in 2019 and 2020, real investment in the country did not compensate for depreciation costs.

As noted, the presence of a real private sector in the economic activities is important which does not exist in Iran, the only thing that does exist are the so-called private-government driven companies which the regime calls ‘Khosulati’ and are mainly in the hands of the regime’s IRGC. Important because without their presence the regime is forced to print more money which is increasing the inflation as we are witnessing now.

Simply said, this is something which is making the life of the coming generation difficult and hopeless.

Eradication of Poverty in Iran Has Become Impossible

Pooya Stone
-
0
Eradication of Poverty in Iran Has Become Impossible

In recent years, the growing inflation in the country has led to the spread of poverty in Iran, so that the head of the Higher Institute for Social Security Research has stated that at least 30 percent of the population is below the poverty line in Iran. Of course, some estimates put the number of people below the poverty line in Iran more than this figure.

The spread of poverty in Iran has resulted that a large segment of the middle class falls below the poverty line, especially in the past three years.

Although in recent years, different statistics of the number of Iranians below the poverty line have been presented, and the regime’s government is trying to hide that real numbers, but all statistics agree on the principle that in the past four years, the number of Iranians below the absolute poverty line has increased year after year and more middle-class households have joined the lower strata.

For example, the Donya-e-Eghtesad newspaper recently citing the results of a credible international study, said that since the beginning of the 2000s, the number of Iran’s poor has doubled, with four million more falling below the international poverty line, earning $5.50 a day. Also, about 8 million people have gone from the ‘middle class’ to the ‘downward middle class’.

Or this June, Roozbeh Kordoni, head of the Supreme Research Institute of Social Security, announced that while the population below Iran’s absolute poverty line had reached 15 percent from 2013 to 2017, the number of people below the country’s absolute poverty line increased to 30 percent and by the end of 2019, practically 25 percent of Iran’s population was below the absolute poverty line.

So far, no comprehensive and consistent reports on the absolute poverty line have been presented about different cities and provinces of the country, which is considered for the regime as a secret and security issue.

Despite the lack of accurate statistics on the number of people below the absolute poverty line in Iran, the number of these people has definitely increased in the past three years, since the cumulative inflation in the three years of 2018, 2019, and 2020 was 115 percent, and of course, the average inflation rate in the 2000s was 24 percent.

In Iran’s economy, the middle and low-income segments of society are much more affected by inflation than the wealthy. Due to the disruption of wealth redistribution systems i.e., banking system, tax system, and subsidy system, the damage caused by inflation is directly imposed on the middle- and low-income classes, because this disruption in the country’s wealth redistribution systems is created deliberately by the regime’s officials in the favor of its elements.

With cumulative inflation of 115% in the past three years and due to the disruption of Iran’s economic system, certainly since 2018, the number of households below the absolute poverty line has been growing significantly compared to before, as a large part of the middle classes have joined the low-income segments of society during this period.

In the constitution of this regime, governments are also obliged to provide minimum livelihoods, including housing and jobs suitable for the people of the society, something that has not happened over the past decades, and the people’s protests for a basic life has been responded to always with repression, detention, and torture.

Unless the economic structures in Iran have been reformed, there is no hope for the eradication of poverty in Iran, because the three key systems of Iran’s economy, the banking system, the tax system, and the subsidy system, are all in the service of the wealthy ruling people.

Hidden subsidies, including fuel subsidies, energy carriers, and other subsidies in the manufacturing sector, all benefit the wealthy with manufacturing enterprises. Also, a large portion of importers of goods to Iran also have preferential currency rents or rents monopolizing in different markets, and this shows that Iran’s subsidy system is entirely regulated for the benefit of the wealthy.

The country’s banking system also fully serves the rich, because when the interest rate of banking system facilities is about 18 percent and inflation is about 40 percent, so it can be said that the real interest rate in Iran is -22 percent. This means that anyone who can get facilities in Iran makes 22 percent profit per year. However, in Iran, mainly the wealthy, i.e., those who have access to large collateral and have extensive rents, can receive large collateral.

In Iran, taxes such as wealth taxes, capital gains taxes, and taxes on luxury goods are not defined. Meanwhile, a large part of Iran country’s wealthy people is basically not paying any taxes, so that this group both deals with tax evasion and receives tax exemptions using written and unwritten laws and corrupt relations.

When the three key systems of Iran’s economy, tax, banking, and subsidy systems, serve the wealthy, so in such circumstances, the eradication of poverty is more like a joke, and until these wealth redistribution systems are reformed, there is no hope of reducing poverty in Iran.

In Iran’s inflationary economy, because wealth redistribution systems do not work properly, inflation is imposed on the middle and poor deciles of the society. This has led to a day-to-day decrease in Iran’s middle class in the past few years, and if this trend continues, we will soon see the elimination of the middle class, which means that Iran’s economy will become a bipolar economy in which 10 percent of the population will be wealthy and 90 percent of the country’s population will be poor.

1...255256257...3,781Page 256 of 3,781