Three-minute read
Iran’s economy has faced severe instability for over four decades, with major fluctuations affecting currency, capital, and investment markets. The Iranian people have directly felt the impact through a sharp decline in purchasing power, as the prices of essential goods, especially food and housing, have surged. This report follows a timeline of major economic developments, offering a clear perspective on Iran’s ongoing crisis.
Currency Shocks and Market Volatility (2011–2025)
Severe currency devaluation has been a key feature of Iran’s economic instability. Since 2011, Iran has experienced five major currency shocks, making long-term financial planning nearly impossible.
- First shock (2011–2013): The U.S. dollar surged from 1,000 tomans to 3,000 tomans under the regime’s former president, Mahmoud Ahmadinejad.
- Second shock (2018): The U.S. withdrawal from the JCPOA raised the dollar to 5,000–6,000 tomans.
- Third and fourth shocks (2020–2023): Currency volatility under Hassan Rouhani and Ebrahim Raisi pushed the dollar beyond 30,000 tomans.
- Fifth shock (2024): The dollar rose by 35% in less than two months, surpassing 60,000 tomans.
These fluctuations have destroyed public trust, discouraged investment, and eroded savings. (AP News, 2024)
#Iran’s Regime Fears Impending Social Explosion Amid Worsening #Economic and Social Criseshttps://t.co/h9e5afgF4l
— NCRI-FAC (@iran_policy) March 4, 2025
Rising Inflation and Declining Purchasing Power (2011–2025)
Inflation in Iran has been among the highest in the world. While official statistics and figures cannot be fully trusted due to the regime’s systemic manipulation and lack of transparency, they still provide a broad indication of the country’s ongoing economic challenges.
- Before 2011, annual inflation was at 25%.
- Between 2019 and 2023, inflation averaged 45%, pushing millions into poverty.
- By early 2024, inflation remained above 40%, with basic food prices rising by over 100%. A year after then regime’s president Ebrahim Raisi’s 2023 directives to curb inflation, Central Bank data revealed a failure to control it, with inflation surpassing 52% —the highest in 80 years, exceeding both Rafsanjani’s 49.4% record and World War II-era levels.
Despite minimum wage increases, the cost of living continues to outpace salaries, shrinking the middle class.
Investment Decline and Economic Growth Collapse (2011–2025)
According to Iranian state media, a sharp drop in investment has been one of the defining trends of the 2010s and 2020s.
- In the 1990s, Iran’s gross fixed capital formation grew at an annual rate of 7%.
- Between 2011 and 2025, investment has declined by an average of 6% per year.
- Foreign investment has nearly disappeared, with capital flight estimated at $15 billion annually.
Business uncertainty and state mismanagement have worsened unemployment and economic stagnation.
#IranProtests: February 2025 Sees 216 Demonstrations Amid Economic and Political Crisishttps://t.co/3inZJSuYEy
— NCRI-FAC (@iran_policy) March 4, 2025
Structural Failures and Economic Mismanagement
Iran’s economic instability stems from deep-rooted financial mismanagement, budget deficits, and political instability.
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Fiscal Imbalances
- Government revenue has fallen due to mismanagement and rising deficits.
- Money printing has fueled inflation, worsening financial instability.
- Foreign investment is stagnant due to unpredictable economic conditions.
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Corruption and Banking Crisis
- Widespread corruption has driven capital flight and economic decline.
- The banking sector is on the brink of collapse, with multiple banks relying on fictitious assets.
- The impeachment of the regime’s finance minister in March 2025 highlights internal divisions.
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Public Sector Deficits
- Social Security, municipalities, and military-linked foundations are all running massive deficits.
- Public services are deteriorating as government funds dry up.
- Government debt continues to rise, placing pressure on low-income citizens.
Key Economic and Social Crises in 2024
– Gas Shortages: Severe disruptions caused blackouts, halted industries, and forced closures across provinces.
– Power Outages: Blackouts due to mismanagement and #IRGC’s illicit Bitcoin mining
– Currency Depreciation: Rial hit a record low… pic.twitter.com/sB0iWzFn1Y— NCRI-FAC (@iran_policy) January 1, 2025
Resource Wealth, Economic Collapse
Iran, with 14% of the world’s oil and gas reserves, should be economically strong, yet decades of mismanagement and systemic plundering by the ruling establishment have driven it toward instability.
- The nuclear program has cost hundreds of billions of dollars, leading to economic sanctions with no financial gains.
- Military spending on missile programs, regional interventions, and proxy groups drains the economy.
- Infrastructure, education, and healthcare have been neglected for decades.
Iran’s economic crisis is primarily the result of mismanagement, corruption, and financial irresponsibility. The clerical dictatorship prioritizes political survival over economic stability, leaving millions struggling with inflation, currency collapse, and declining living standards.
Meaningful reform is neither imaginable nor possible under the current regime, whose very foundation rests on corruption, repression, and economic plunder. For the people of Iran to not only survive but reclaim their dignity and thrive, this regime—along with its web of corrupt agencies and entrenched power structures—must be dismantled in its entirety. Only then can Iran’s vast wealth and potential serve its citizens rather than those who have exploited and betrayed them for decades. A stable and flourishing Iran would not only restore prosperity to its people but also contribute to peace and security in the Middle East and strengthen the global economy, freeing the region from the cycle of conflict and instability that has long been fueled by the regime’s policies.