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Iran’s Currency Freefall: More Pressure on People and a Direct Result of Regime’s Wrong Policies

Iran’s Currency Freefall: More Pressure on People and a Direct Result of Regime’s Wrong Policies
Iran’s Currency Freefall: More Pressure on People and a Direct Result of Regime’s Wrong Policies

Iran’s national currency is rapidly losing its value against the U.S. dollar. Today, $1 was exchanged at 21,700 tomans on the Iranian market.  The exchange rate on Friday, June 19, was 18,800 tomans, and it has increased by nearly 20 percent in less than two weeks.  

In other words, the value of Iran’s currency and the purchasing power of employees and the underprivileged have fallen by 20 percent in just two weeks, and the people have become poorer by 20 percent in just two weeks.  

The freefall of the value of a country’s currency is an indicator of its government’s absolute economic bankruptcy. The current value of Iran’s currency, along with other indications such inflation and liquidity rate, adds more pressure on the Iranian people.  According to state-run media, the terrible amount of liquidity has reached 2651 trillion tomans. This huge amount of liquidity will result in a rising inflation rate and higher prices. The regime, along with its institutionalized corruption, has increased the prices of all goods, or has been spending people’s wealth on terrorism.  

Sadegh Ziba-Kalam, one of the regime’s experts, who is close to Hassan Rouhani’s government, in this regard told the state-run Etemad website on June 25: “Let’s start with a simple math and initial division of this year’s budget to determine why each dollar is equivalent to 20,000 tomans? The general budget of the government this year is about 480 trillion tomans … Even before the COVID-19 pandemic, the government did not have 150 trillion tomans, or nearly one-third of its 480 trillion toman budget [the regime faced a budget deficit]. The budget was approved by [the regime’s] Parliament in December. Approximately half of this budget comes from taxes [195 trillion tomans] and oil exports [at least one million barrels per day at an average of $50 a barrel].” 

While trying to undermine the regime’s institutionalized corruption and use of national funds for export of terrorism, Ziba-Kalam added: Sanctions and the COVID-19 pandemic dismissed all the government’s calculations. Sanctions decrease [the regime’s] oil exports from one million barrels to less than 100,000 barrels a day, in a best-case scenario. Let alone that Iran [regime] circumvents sanctions so it has to reduce the price and sell the same 100,000 barrels at much less than the official price. Aside from oil revenue, the pandemic has already disrupted the country’s tax revenues to the present day. The fate of oil and taxes revenues, two main resources of this year’s budget, are currently unknown. In addition, there was a one-third budget deficit. 

Earlier in June, EshaghJahangiri, the Iranian regime’s vice president, acknowledged that there has been a sharp drop in the regime’s oil revenues due to U.S. sanctions, with the revenue at around $8 billion last year.  “We had $100 billion in oil revenues. But our total oil revenue last year was around $8 billion. This decrease of revenue has had an impact on all parts, including the government’s budget,” he added.  

Despite being under sanctions and the sharp drop in the country’s revenues, the regime has not ceased plundering the national wealth to fund its malign activities or fill the pocket with its mercenaries. 

Another regime economist, Hussain Raghfar, in an interview with the ILNA news agency, while referring to the prophecies about the rising currency rate in Iran, said: Many of these speculations are in line with the economic policies in Iran, which go beyond the government. The entire political-economic system has decided to use the people’s pockets for the time being to pay the [regime’s] expenses.” 

One of the most important decisions to make is to raise the exchange rate. Certainly, the consequences of this decision will be on all people, society, production and the future of the economy,” he added.  

In this regard, on June 4, the state-run Eqtesad News website wrote: “According to the Majlis Research Center, the poverty line of four-person households in Tehran has increased from 2.5 million tomans to 4.5 million tomans in the last two years, which means that the inflation rate has increased by 80%, and this inflation rate has led to significant growth in the poverty line in Tehran and other parts of the country. This, along with a significant reduction of general income, has led to an increase in the poverty rate over the years, and the available evidence suggests that this variable is increasing in 2019 and 2020.” 

Yet, instead of taking necessary action, the regime’s president Hassan Rouhani on June 23, at a meeting of the government’s economic coordination headquarters, called the exchange rate increase “temporary” and “passing. His remarks confirm the regime has no intention of changing its wrong economic policies.   

The regime spends billions of Iranian people’s wealth on terrorism. The regime’s warmongering policies has not only pushed Iranian people further under the poverty line, but it has resulted in economic sanctions.  In addition, the regime’s institutionalized corruption leaves nothing for the Iranian people. The mullahs mismanagement of the COVID-19 pandemic and delaying in paying medical staff and other people’s paychecks, which have resulted in protests across the country, shows the regime has no intention of helping the Iranian people.   

As Mrs. Maryam Rajavi, the President-elect of the National Council of Resistance of Iran (NCRI), has said: All the promises by the mullahs to the deprived and calamity-stricken people of Iran are hollow and worthless. The only way to end poverty, destitution, and unemployment is to end the mullahs’ evil dictatorship and establish freedom and people’s sovereignty.