By Dr. Sanabargh Zahedi
In Tehran on Monday, the value of Iran’s official currency, the Rial, took yet another dive, standing at 35000 rials for each U.S. dollar. Two years ago, it stood at 29000 rials to the dollar.
The fall in the currency value is an important indicator of the fragile state of Iran’s economy and illustrates the Rouhani government inability to improve the country’s economic conditions.
The state-run Fars news agency reported that this is the highest value for the dollar in the past two years.
The nuclear deal between Iran’s regime and the six world powers on July 14 resulted in a reduction in the price of foreign currency and gold to some extent, but only a few days later the Rial again lost its value against foreign currencies.
There were expectations that following the nuclear deal the economy would improve but reports indicate that severe stagnation still hurts the economy.
Mohammad Bagher Nobakht, head of the regime’s Management and Planning Organization, recently stated that Iran’s budget deficit has reached 50% for this year.
The director of exports of Iran’s Central Bank has stated that “increase in real demand, increase in delayed payments, plunge in oil prices, increase of trade in unofficial markets, and waning of market excitements” are among the causes for an increase in the value of foreign currencies.
The price of Iranian oil was estimated at $70 a barrel when Hassan Rouhani’s administration set this year’s budget; but oil prices now stand at $40 a barrel.
Nevertheless, analysts of the Iranian economy believe that even without a drop in oil prices, it was unimaginable for Iran’s economy to rebound from bankruptcy. The expenses of the war in Syria and Tehran’s backing of the Houthis in Yemen and the militias affiliated with the Quds Force in Iraq, as well as the billions spent each year on the nuclear weapons projects are burdening the Iranian economy and depriving the country of internal investments.
Most importantly, the entirety of Iran’s economy is suffering from institutionalized corruption and a monopoly by organs affiliated to the regime’s Supreme Leader Ali Khamenei, in particular the Islamic Revolutionary Guards Corps (IRGC).
Dr. Sanabargh Zahedi, Chairman of the Judicial Committee of the National Council of Resistance of Iran (NCRI)