Iran in recent months has been beset by economic problems despite the promises surrounding the 2015 nuclear deal it struck with world powers. Its government is starting to take notice. Politicians now offer the idea of possible government referendums or early elections.
Even Supreme Leader Ayatollah Ali Khamenei acknowledged the depths of the problems ahead of the 40th anniversary of Iran’s Islamic Revolution. “Progress has been made in various sectors in the real sense of the word; however, we admit that in the area of ‘justice’ we are lagging behind,” Ayatollah Khamenei said in February, according to an official transcript. “We should apologise to Allah the Exalted and to our dear people.”
Iran today largely remains a state-run economy. It has tried to privatise some of its industries, but critics say they have been handed over to a wealthy elite that looted them and ran them into the ground. One major strike now grips the Iran National Steel Industrial Group in Ahvaz, in the country’s southwest, where hundreds of workers say they haven’t been paid in three months. Authorities say some demonstrators have been arrested during the strike.
High unemployment
More than 3.2 million Iranians are jobless, government spokesman Mohammad-Bagher Nobakht has said. The unemployment rate is over 11%.
Banks remain hobbled by billions of dollars in bad loans, some from the era of nuclear sanctions and others tainted with fraud.
Meanwhile, much of the economy is in the grip of Iran’s security services. The country’s powerful Revolutionary Guard paramilitary force controls 15-30% of the economy, analysts say. Under President Hassan Rouhani, there has been a push toward ending military control of some businesses. However, the Guard is unlikely to give up its power easily.
Some suggest hard-liners and the Guard may welcome the economic turmoil in Iran as it weakens Mr. Rouhani’s position. His popularity has slipped since winning a landslide re-election in May 2017, in part over the country’s economic woes.
Analysts believe a hard-line protest in late December likely lit the fuse for the nationwide demonstrations that swept across some 75 cities. While initially focused on the economy, they quickly turned anti-government. At least 25 people were killed in clashes surrounding the demonstrations, while nearly 5,000 reportedly were arrested.
In the time since, Mr. Rouhani has suggested holding a referendum, without specifying what exactly would be voted on. “If factions have differences, there is no need to fight, bring it to the ballot,” Mr. Rouhani said in a speech February 11. “Do whatever the people say.”
Such words don’t come lightly. There have been only two referendums since the Islamic Revolution.
A letter signed by 15 prominent Iranians published a day after Mr. Rouhani’s speech called for a referendum on whether Iran should become a secular parliamentary democracy. The letter was signed by Iranians living inside the country and abroad, including Nobel Prize laureate Shirin Ebadi.
But even among moderates in Iran’s clerical establishment, there seems to be little interest in such far-reaching changes, which would spell the end of the Islamic Republic.
