Internet Services Disrupted In Iran Amid Authorities’ Buck Passing

The overall nationwide point-to-point annual food inflation rate in June 2022 compared with the same period in 2021 was 87 percent, SCI reported last week, but in four provinces the rate reached almost 100 percent.

Most of the price increases happened since early May when the government scrapped a food import subsidy to save around $15 billion annually. The move immediately triggered a massive rise in prices for basic food staples, such as bread, dairy products, cooking oil and meet.

Although the government has repeatedly said its oil exports are steadily increasing despite sanctions by the United States, economic conditions keep deteriorating, with overall annual inflation reaching 54 percent in June.

However, Iran has not made a decisive move to reach a nuclear agreement with the US, which could lift oil export sanctions and boost government revenues.

When the government stopped the import subsidies it promised to issue coupons to people with lower incomes to buy essential food items at lower prices, but so far, no system has been set up to issue coupons.

Aftab News in Tehran said Monday that the government is planning not to issue coupons offering lower prices but aims to limit how much food people can buy. This would create new political tensions even among the hardline supporters of the government. The website adds that food prices will never go down, and on the contrary inflation can only get worse.

Another major problem during US sanctions is the fast growth in Iran’s money supply, which has climbed to upwards of 50 quadrillion rials. That is 50 with fifteen zeros. In free market exchange rate this amount would be around $200 billion, simply because the Iranian currency has lost so much of its value. If we take the exchange rate before the United States imposed sanctions in 2018, the liquidity in Iran would be equivalent to 1.5 trillion dollars.

Mahmoud Jamsaz, an economist in Tehran told Khabar Online news website on July 31 that in the past Iranian year, from March 2021-to March 2022, the government has been printing the equivalent of $15 million a day to finance its budgetary shortfall. That is 3.8 trillion rials every day.

Despite assurances by President Ebrahim Raisi’s (Raeesi) government that it has stopped printing money, Jamsaz insisted that simply the format of government borrowing has changed, not the fact that it is adding to the money supply. This in turn fuels more inflation, impoverishing tens of millions of people who were modest wage earners or members of the middle class, able to live relatively comfortable lives before.

The economist explained that government finances this year are in a worse situation compared to last year, because the budget has been built on two unrealistic revenue projections.

The biggest expectation is close to five quadrillion rials of oil income, twice as high as what materialized last year, while US sanctions are still in place and the war in Ukraine has made Russia a competitive to Iran in the oil market.

The second optimistic figure is tax revenues estimated to be 62 percent higher than last year. This is unrealistic because the economy is not growing to allow so much more tax collection.

This was confirmed by the Supreme Accounting Office of the state in July that said just 15 percent of expected oil revenue came into the treasury from March to May.

Jamsaz, like other economists says that the Raisi government holds “the record in both high inflation and money supply” in nearly three decades.

Speaking in his weekly press conference on Monday, Iran’s foreign ministry spokesman Nasser Kanaani said that stability in the region depends on the stability in Iraq. 

Emphasizing that dialogue is the best way to solve Iraq’s domestic problems, he said, “we are confident that with the maturity of the Iraqi people, and the tact by the Iraqi leaders, the country will pass this phase well and we will witness increasing stability and peace in Iraq.”

Describing Iraq as Iran’s “big and important neighboring country,” Kanaani said Tehran follows the developments there carefully and attaches significant importance to the security of this “important friendly and brotherly neighbor.”

“We believe that Iraqi political movements and parties and organizations can overcome the current situation in a peaceful way... within the framework of the constitution and legal mechanisms of the country and help the country’s development and progress through forming a popular government,” he added. 

On Sunday, July 31, influential Iraqi Shiite cleric Muqtada al-Sadr -- who seeks to curb the influence of the Islamic Republic of Iran in Iraqi politics -- called on his supporters to join thousands of others who have camped at the parliament to prevent the formation of a new government, saying that now is the best time to change the political system and constitution. “This is a great chance for radical change to the political system. Don’t miss your chance."

The recent cases happened in the northern city of Lahijan and western city of Ilam due to financial hardships the victims faced. The prosecutor of Lahijan, Ebrahim Ansari, said on Sunday that one of the workers of the city’s water and wastewater management company set himself on fire in protest to his suspension by the contracting company. 

Hengaw Organization for Human Rights also reported that a 30-year-old man, identified as Jamil Valibaygi, set himself on fire because of financial pressures. 

In June, two workers in Bandar-e Mahshahr in the southwestern province of Khuzestan also set themselves on fire in protest to their dismissal. They survived thanks to prompt intervention by their coworkers. Earlier, a worker in the city of Yasuj, the capital of Kohgiluyeh and Boyer-Ahmad province, set himself on fire over his inability to pay a debt of about 10 million tomans, or $300. 

Earlier in the year, a biology teacher killed himself in the city of Minab in the southern province of Hormozgan over economic problems. In recent months, there have been other reports about teachers committing suicide due to financial problems, including Gholamabbas Yahyapour, a mathematics teacher from the city of Gerash in the Fars province who killed himself late in 2021.

Food prices have risen by more than 80 to 100 percent in recent months, on top of high inflation in the previous three years, while most wage earners get less than $200 a month.

Fariba Kamalabadi, Mahvash Sabet (Shahriari) and Afif Naimi, three former directors of the Iranian Baha'i community known as "Yaran", were among those who were arrested on Sunday, July 31, in Tehran and Karaj. The three had been detained before in 2018 and spent 10 years behind bars. 

Several arrests were also reported in the cities of Sari in the northern Mazandaran province and Qazvin, near the capital. 

Iran’s intelligence ministry claimed on Monday that the arrested Baha’is were linked to the Baha’i center in Israel, where the religious group’s international headquarters are located, and had collected and transferred information there.

The Worldwide Baha’i Community said in a July 20 statement that Tehran had intensified its systematic campaign to suppress the religious minority in recent weeks, either arresting, summoning to court, putting on trial or closing the businesses of at least 20 Baha'i citizens just in July.

According to the community, in June at least 44 Baha'is were detained, summoned to court, put on trial or given prison sentences, or had their homes searched.

The 1979 constitution of the Islamic Republic recognizes only Islam, Christianity, Judaism and Zoroastrianism. Supreme Leader Ali Khamenei has on several occasions called the Baha'i faith a cult and in a religious fatwa in 2018 forbade contact, including business dealings, with followers of the faith.

Baha'is, who number around 300,000 in Iran, say their rights are systematically violated and they are often harassed, forced to leave their homes and businesses, and are deprived of government jobs and university education.

Following a meeting with the members of parliament's energy committee on Sunday, Mohammad Eslami, vice president and the head of the Atomic Energy Organization of Iran (AEOI), said that the parliamentarians are pushing to turn the so-called comprehensive roadmap for nuclear industry into law in such a way that the nuclear development process is not damaged by the change of administrations.

The document, which was unveiled on April 9 this year by the AEOI, includes the country’s plans for nuclear activities such as power generation, increasing nuclear radiation applications, radiopharmaceuticals, protection against radiation, and developing nuclear infrastructures. 

He added that the AEOI wants people to feel the tangible effects of nuclear technology in their lives. 

During the past weeks, many Iranian observers including commentators and lawmakers criticized President Ebrahim Raisi for claiming that the people wish to resist rather than reach an agreement that would lift US sanctions and bring about a breakthrough in Iran's economy.

Some former Iranian diplomats suggested that Raisi and other ultraconservatives take advantage of the current foreign policy impasse over the revival of the JCPOA for their own personal or factional political gains to strengthen their foothold in Iran's domestic politics.

Diplomats negotiating to revive the 2015 nuclear deal, JCPOA, have repeatedly said that an agreement has almost been completed in 11 months of talks in Vienna, but Tehran demands more sanctions be lifted than Washington is willing to waive.