Iran International
Iran faces a serious shortage in medicines with some prices rising sevenfold, months after the government eliminated cheap dollars for importing raw materials.
The crisis in health care is just one aspect of the overall economic crisis, precipitated by a centralized and often mismanaged economy, and for the past years, US sanctions.
Most medicines in Iran are produced locally by quasi-governmental companies that import the raw material from other countries. When the Iranian currency began to lose value in early 2018, the government offered a fixed exchange rate for essential goods, mainly food and medicines. However, earlier this year, the new administration of President Ebrahim Raisi eliminated what was in fact a government subsidy. Now, food and medicine producers must buy dollars at rates seven times higher to import their raw materials, which has disrupted production.
Deputy chairman of pharmaceuticals producers, Ali Fatemi told Aftab News in Tehran that when an economic sector is controlled by the government and is managed according to “a command economy” it is not surprising that a situation like the current shortage would emerge. The government sets unreasonably low prices and then stops subsidies, which makes it impossible for its companies to but raw materials and produce, he said.
To partially alleviate the shortage, the Iranian government allows medicines, such as antibiotics and simple cough syrups to be imported from India, Fatemi explained, and as a result the country spends much more foreign currency, instead of importing the raw materials.
Apart from pharmaceuticals, inflationary recession has gripped other sectors, according to Fararu website in Tehran. As prices have risen at least by 40 percent for two consecutive years, consumers have lost their purchasing power and demand has fallen. This has led to a “domino effect for producers and factories” that must stop operations. This in turn creates more unemployment and less consumer demand.
Iran’s currency has fallen by more than 15 percent since early September when it became clear that a nuclear agreement with West was not a realistic expectation.
Since early 2018, when the United States signaled its intention to withdraw from the 2015 nuclear deal known as the JCPOA, Iran’s rial has fallen tenfold from 35,000 to the dollar to 350,000 on November 12. When the US did withdraw from the accord in May of that year, it imposed damaging oil and banking sanction on Iran. This further devalued the rial and led to very high inflation, which coupled with the inefficiencies of a government-controlled economy, has impoverished tens of millions of people.
Ehsan Soltani, an economist in Iran told the website that while food prices have risen eightfold since 2018, wages, at most, have increased threefold.
“In recent years with rising inflation, economists warned officials about ‘inflationary recession’, but the government did not pay attention at all,” Soltani explained.
In fact, from cautious statements by many officials, especially in the previous Iranian government headed by President Hassan Rouhani, it was apparent that they were aware of the dire situation, but they had no control over the country’s foreign policy, which had brough about crippling US sanctions.
But Iran’s 83-year-old anti-Western ruler, Ali Khamenei, has the last word on foreign policy and only he could allow a new nuclear deal to be signed that would lift the most damaging sanctions.
Iran’s economic growth in the past decade has been zero and Soltani compared Iran to its neighbor Turkey. “Just look at Turkey…and see the high rate of growth it has achieved in the past ten years, adding tremendously to its foreign currency revenues, while we have faced economic and infrastructure decay.”
Department spokesperson Ned Price answering a question during his press briefing about the visit of Russia’s national security council secretary Nilolai Patrushev to Iran this week, said, “All of this is a concern in the context of the partnership – in some ways the burgeoning partnership – that we’ve seen develop in recent years and in different ways in recent months between Iran and Russia. This is a deepening alliance that the entire world should view as a profound threat.“
Patrushev held meetings with his Iranian counterpart Ali Shamkhani and President Ebrahim Raisi on November 9, discussing their "strategic partnership".
Price referring to Iranian drones used by Russia against Ukraine said that the US is working with the international community "to address the threats that are posed by Russia and Iran separately and the cooperation…between the two of them, including Iran’s dangerous proliferation of weapon systems to Russia."
Price also reiterated concern over Russia possibly helping Iran with knowledge of how to suppress protests but did not share any evidence of such cooperation.
A reporter asked Price during his briefing for more details about an initial statement two weeks ago that Russia may be helping Iran to suppress demonstrators.
“Unfortunately, there’s nothing more I can provide,’ Price responded adding that “In some instances we’re able to provide additional detail, including as we’ve done with the transfer of weapons. In this case it was the broader point that there are indications that this knowledge may be shared.”
Price went on to say that both Russia and Iran “have a good deal of experience when it comes to repression. They have both demonstrated their effectiveness when it comes to their ability to repress their people…our concern is that they will share this knowledge and that they will attempt to optimize those practices.”
Russia is a signatory of the 2015 nuclear accord known as the JCPOA and played an active role during 18 months of negotiations in Vienna initiated by the Biden Administration immediately after coming to office. But ultimately Iran presented demands unacceptable for Washington and the talks reached a dead-end in August, as Tehran was delivering military drones to Moscow.
In the meantime, Iran continues to expand its nuclear program with enriching more uranium, with having stockpiled 62 kilograms of fissile material enriched at 60 percent, enough for one nuclear weapon. The UN nuclear watchdog, the IAEA confirming this development voiced concern on Thursday [Nov. 10].
Iran is also expanding its missile program, with testing its ballistic missiles with space launches and developing new weapons.
A top Iranian commander announced Thursday that Tehran has developed hypersonic ballistic missile.
"This missile has a high speed and can maneuver in and out of the atmosphere. It will target the enemy's advanced anti-missile systems and is a big generational leap in the field of missiles," commander Amir-Ali Hajizadeh was quoted as saying.
IAEA’s chief Rafael Grossi pointing to this announcement said during the United Nations COP27 climate meeting in Egypt that “We see that all these announcements increase the attention, increase the concerns, increase the public attention to the Iranian nuclear program.”
A short alert said that Elham Afkari was detained as she tried to “flee the country” as well as her husband and three-year-old daughter. She was accused of fomenting the current popular protests.
Afkari is the sister of Iranian wrestler Navid Afkari who was executed in September 2020, after participating in protests and being accused of killing a government employee. His execution led to strong domestic and international condemnations.
Two of Afkari’s brothers are still in prison serving a jail term of 66 years between the two and the family has been persecuted for more than four years. Navid and his two brothers were subjected to extensive torture in prison.
Iran International, a London-based Persian broadcaster, reacted to the news by tweeting that Elham Afkari never “worked for or collaborated” with the network.
It also condemned the coverage of the news by Reuters and Aljazeera Arabic for repeating “the Islamic Republic’s sheer lies” regarding Afkari’s arrest.
The Iranian government has arrested an estimated 15,000 protesters since mid-September when demonstrations started after a young woman, Mahsa Amini, was killed in ‘morality police’ custody. Iranian lawmakers and officials have threatened many detainees with the death penalty.
The Islamic Republic’s Judiciary is not independent and both prosecution and judges answer to the same bureaucracy that closely collaborates with intelligence services. The accused usually are denied the chance to choose their own attorneys and have little access to their case files. In cae of political prisoners, such as detained protesters, trials are generally unfair.
Iranian officials and government-controlled media have repeatedly accused foreign-based Persian media for fomenting the unrest, without presenting any credible proof. Three influential networks are based in London and provide news and views to audiences in Iran who have long been denied access to free media. Besides Iran International, Islamic Republic officials have also accused the BBC Persian service of agitating during the protests.
Tehran has accused foreign “enemies”, meaning the United States and its allies of being behind the protests, although numerous rounds of demonstrations have taken place since 2017 by various social and labor groups.
In desperation to prove foreign conspiracies, the Islamic Republic may arrest more people and activists, and accuse them of collaborating with Iran International or other media outlets.