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Iran is grappling with a worsening economic crisis as rampant inflation and soaring poverty continue to strain the daily lives of millions. Recent data highlights sharp increases in the cost of basic goods, such as bread, and a growing reliance on installment-based purchases, signaling a society increasingly burdened by financial hardship.
A sharp rise in food prices has exemplified the crisis. On November 16, the official Iranian news agency confirmed a 25% increase in bread prices in Semnan Province. Subsidized Lavash bread now costs 6,250 rials, compared to 2,500 rials in 2021, while Barabari bread has risen from 7,500 rials to 18,750 rials during the same period—a staggering increase of more than 100% in three years. Similarly, in Mashhad, the price of tomatoes surged by 400% within just three weeks, reaching 18,000 tomans per kilogram.
Amid these price hikes, families are increasingly turning to installment-based purchases to meet basic needs. A November 17 report by Ham-Mihan highlighted a surge in the use of credit platforms, with a 200% increase in small loans for food purchases. Families are buying essentials like meat, dairy, and poultry on credit, while installment plans now extend to services like cosmetic and dental procedures, advertised with 12-month repayment options. Sociologist Somayeh Tohidloo warned that this trend is “eating away at the future,” trapping families in a cycle of perpetual debt and worsening systemic poverty.
Amid Budget Shortfall in #Iran, #Pezeshkian Government Prioritizes Gas Price Hike Over Security Expenditureshttps://t.co/MEzoIUDB75
— NCRI-FAC (@iran_policy) October 1, 2024
The growing reliance on credit reflects the unsustainable pressures on households. The minimum monthly wage for a worker with a family is 11 million tomans, far below the estimated 37 million tomans required for basic living expenses. State-affiliated economist Farshad Momeni cautioned that the government’s current fiscal policies will make the situation “even more dangerous and worrisome” in the coming year.
A recent report by the Research Center of the Iranian Parliament described inflation as a “cancer” that erodes the economy and fuels speculative activity, capital flight, and unemployment. The center’s data revealed that the number of Iranians living below the food poverty line has surged from 18 million in 2016 to over 32 million by 2021. Experts suggest the real figure today may be significantly higher. These inflationary shocks have driven many families to cut consumption or rely on loans to cover basic needs, further straining their already fragile economic stability.
#Iran News in Brief:
Leaked audio file reveals a state radio station chief giving instructions to staff to censor news about soaring prices to avoid #IranProtestshttps://t.co/ajvagouYvL
PART 1 pic.twitter.com/ofrGTSl5z2— NCRI-FAC (@iran_policy) May 10, 2022
While millions of Iranians face these hardships, the regime has channeled billions of dollars into funding regional militant groups and proxy wars. Over the past two decades, massive resources have been allocated to organizations like Hezbollah in Lebanon and various militias in Syria and Iraq, leaving Iran’s domestic economy in shambles. A recent report detailed that, during the Syrian Civil War alone, Supreme Leader Ali Khamenei spent over $50 billion to support Bashar al-Assad’s regime, prioritizing geopolitical ambitions over the welfare of Iranian citizens.
The grave economic and social consequences of inflation are becoming increasingly visible. As the poverty crisis widens and living standards deteriorate, the regime’s focus on regional power plays continues to deepen domestic discontent. Iranian families, burdened by rising costs and systemic inequality, find themselves in an increasingly untenable situation—caught in the crossfire of failed policies and misguided priorities.