President Hassan Rouhani delivered a speech on Wednesday saying that Iran is facing its toughest economic situation in 40 years, but he added that U.S. sanctions are to blame; not the Islamic Republic or the current government.
As the Islamic Republic approaches the 40th anniversary of the 1979 revolution, it is pressed to show what it has accomplished in this period.
Although Rouhani urged the people not to blame the government for the deep economic crisis, Iran’s economy suffers from a range of structural problems that are self-inflicted and not related to sanctions.
By nationalizing most industries after the revolution and imposing multiple restrictions on businesses, imports and investments, the country has had an anemic average growth rate of barely three percent in the past forty years.
Iran’s anti-Western policies, its role in hostage-takings in the 1980s and later arbitrary arrests of foreign and dual nationals, as well as a policy of exporting its Shiite influence in the region, have all contributed to its economic vows.
Rouhani was speaking at a ceremony at the shrine of Ayatollah Rouhollah Khomeini, the founder of the Islamic Republic, as part of a series of events leading up to the 40th anniversary of the February 11th revolution.
Iran’s Supreme Leader Ayatollah Ali Khamenei also visited the shrine on Wednesday but Iranian media have not reported on any remarks by him.
Few Iranian news sites reproduced Rouhani's remarks. The official IRNA did publish a long report, without the reference to "toughest economic situation in 40 years", which only Reuters reported.
This is the first time an Iranian official admits during Islamic revolution's anniversary that the state of economy in Iran has deteriorated. The occasion has always been used to boast about the country’s progress as a result of the 1979 revolution.
Until recently Rouhani has been insisting that there was no economic crisis in the country.
Rouhani’s remarks about the impact of US sanctions is perhaps aimed at Iranian hardliners who have been preventing the ratification of bills that would allow Europe to help Iran circumvent the sanctions.
Last week, Amir Haji Zadeh commander of IRGC’s aerospace force harshly criticized Rouhani and his managers for blaming the sanctions for Iran’s economic problems and expressed strong opposition to ratification of bills required by the international watchdog, Financial Action Task Force.
Tough U.S. sanctions reimposed by President Donald Trump in 2018 have compounded Iran’s economic crisis, which has led to intermittent protests, strikes and a steep devaluation of its currency in the last 13 months.
Criticizing the United States, Rouhani said that few countries have backed the U.S. in its tough policy toward Iran and added that the Iranian people’s will has not been shaken and they’ll have the fortitude to endure the pain of sanctions.
But labor unrest and government arrests of activists indicates volatility in society. During protests in 2018, many shouted slogans against Khamenei and Iran’s policy of spending resources to support Syria’s Bashar al-Assad, the Lebanese Hezbollah and other pro-Iran groups in the region.
Rouhani then went on paying homage to Khomeini and praising the establishment of the Islamic Republic, saying that justice and equality was its biggest accomplishment. But reports in 2018 indicated that more than 25 percent of the population suffers from poverty and class differences, partly built on monopoly of power and corruption, are as high as ever.