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Iran Regime’s Systematic Corruption and Iran’s Economic Crisis

standing in long lines to purchase [poultry at a government-set price]
Standing in long lines to purchase [poultry at a government-set price]

News from Iran indicates how people are grappling with economic hardships, particularly the skyrocketing prices and inflation. Meanwhile, the state-run media acknowledge how the regime’s economic mismanagement has created Iran’s economic crisis. People wait in long lines for hours to purchase their basic needs at governmental prices.

“There have been over a month since we face poultry scarcity around the country, and there are difficulties in distributing it. Each kilogram of poultry should be sold at 20,400 tomans. Unfortunately, a limited number of poultry is distributed among people standing in long lines to purchase [poultry at a government-set price],” wrote the state-run Young Journalist Club (YJC) on Sunday.

“If the government’s officials go to the market, as ordinary people do, they would see that most shops either do not have poultry or selling it at high prices. The poultry [which is supposed to be sold at] 20,400 tomans is being sold at 40,000 tomans. There are long queues in front of markets and shops that distribute poultry at the [adopted] prices. While 1,000 tons of fresh chicken and 1,000 tons of frozen chicken were to be distributed daily to meet Tehran province’s 1,700-ton need, Rahmati, the Chamber of Trade inspector Unions, said that a total of 90 tons of poultry has arrived for Tehran. This should be distributed in Tehran and other cities of the province,” wrote the state-run Tasnim news agency on Thursday in this regard.

A wave of skyrocketing prices of the most basic goods in Iran

The new Persian Year of 1400 started on Sunday. While Iranian people entered the new year with poverty, the regime’s Supreme Leader, Ali Khamenei, called this year “Production: support and the elimination of obstacles.”

“As we enter Nowruz 1400, not only is there no point of hope, but the expected inflation torments us. In all these years, people have always struggled with difficulties, and the [regime] has only praised them for resisting. Officials now face this question, that when would people have their share of peace and comfort? How long do people have to walk through hundreds of shops to buy oil? Really, how long do people have to stand in long queues for hours so that maybe it will be their turn to get poultry, not at a reasonable price, but at a price several times higher than the price they bought a month ago? How long is the people’s share of [the so-called] resistance supposed to be skyrocketing prices and empty tables? How long should salaries be below the poverty line?” wrote the state-run Tejarat daily on Thursday in this regard.

What is the reason for Iran’s economic crisis?

The mullahs’ regime and its apologists have been trying to blame sanctions as the sole reason for Iran’s economic crisis, including the skyrocketing prices and the increasing inflation rate.

The regime has aggravated Iran’s economic crisis by catastrophic policies, such as banknote printing. Banknote printing increases the liquidity rate and ultimately results in the rapid growth of point-to-point inflation.

“In 2019 and 2020, parts of the government’s budget came from the National Development Fund’s foreign exchange earnings, which simply means banknote printing,” Abdolnasser Hemmati, head of Iran’s Central Bank, said on Sunday.

“Inflation is one of the biggest and most fundamental problems that has plagued Iran’s economy for the past 40 years. The most important structural factor of inflation in the Iranian economy is the government budget deficit. Without the Coronavirus crisis, this year’s government budget deficit was predicted to be 130,000 billion tomans. Banknote printing is offset, which increases the monetary base and liquidity and ultimately has an inflationary effect,” wrote the state-run Arman daily on March 13 in this regard.

“Today, the government has chosen a path that will surely devalue the national currency, which will result in inflation, skyrocketing prices, and reduced purchasing power of the people,” the state-run Tasnim news agency quoted regime’s MP Alireza Salimi.

“In the [Hassan] Rouhani administration, the Gini coefficient shows a deplorable situation that has been unprecedented in the last 60 years. Likewise, liquidity and average inflation have been unprecedented in the last 50 years. These are the unbridled liquidity growth results that the government either did not want or could not control. Once they blame the previous government, once people, once Donald Trump, and now they say they would reveal the problems later. Each time they are looking for someone to blame,” Salimi acknowledged.

Despite Khamenei calling the current Persian year the year of “Production: support and the elimination of obstacles,” state-run media acknowledged that the real obstacle to Iran’s domestic production is the regime.

For example, vehicle prices are skyrocketing in Iran. According to Maziar Biglou, Secretary of the Parts Manufacturers Association, “Vehicles become cheaper if the domestic embargo on production is lifted.”

“In my opinion, [Khamenei’s slogan for 1400] shows sanction had a little damaging effect on the industry. Unfortunately, [officials’] recklessness and domestic sanctions have affected the industry,” Biglou added, according to the state-run YJC news agency on Sunday.

In another admission, Azar Mansouri, a senior member of the Union of Islamic Iran People Party, pointed to the regime’s systematic corruption, calling Khamenei’s new year remarks as “propaganda.”

“Naming a year without its requirements in consecutive years has caused these names to take on more of a propaganda and slogan role and sometimes become a contradiction, and the year 1400 is no exception to this rule. Systematic corruption is a serious obstacle to increasing national capital. Therefore, we need serious, real, and legal reforms in the [regime] to combat and reduce it, not slogans,” Mansouri said, according to the state-run ILNA news agency on Sunday.