Afghanistan Feels Impact of Iran's Economic Isolation

A group of Afghan migrants walk along a main road after crossing the Turkey- Iran border near Erzurum, eastern Turkey, April 12, 2018. (Reuters)
A group of Afghan migrants walk along a main road after crossing the Turkey- Iran border near Erzurum, eastern Turkey, April 12, 2018. (Reuters)
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Afghanistan Feels Impact of Iran's Economic Isolation

A group of Afghan migrants walk along a main road after crossing the Turkey- Iran border near Erzurum, eastern Turkey, April 12, 2018. (Reuters)
A group of Afghan migrants walk along a main road after crossing the Turkey- Iran border near Erzurum, eastern Turkey, April 12, 2018. (Reuters)

Abdul Saboor escaped poverty and instability in Afghanistan three years ago with his wife and three children and found work in neighboring Iran. Now he has returned home, despite the fact that life there has not improved.

His job at a grocery store in the central Iranian city of Isfahan brought in about 280 dollars a month, enough to support his family. But the Iranian rial took a dive last year and his employer cut his wages to less than 100 dollars a month, said a Reuters report on Thursday.

“The economic situation in Iran is really bad,” said the 28-year-old. “Wages have gone down since last year and a lot of families had to return to Afghanistan.”

Afghans began moving to Iran in large numbers after the Soviet invasion in 1979 and they continued to migrate for work through decades of conflict, sending money to relatives back home that helped bolster Afghanistan’s struggling economy.

In 2017, there were approximately 2.5 million to 3 million Afghans in Iran, according to Iranian government estimates cited by the United Nations.

That number could be cut in half by the end of this year. More than 770,000 Afghans left Iran last year as the currency faltered and an extra 570,000 are expected to go this year, the International Organization for Migration (IOM) said in January.

Iran’s economy has been squeezed since President Donald Trump reimposed sanctions on Iran last year after pulling out of a 2015 nuclear deal between Tehran and world powers.

US officials have said the sanctions are intended to pressure Iran to negotiate over what they say are its aggressive missile program and regional policy.

The rial lost approximately 70 percent of its value last year before recovering slightly, disrupting Iran’s foreign trade and helping boost annual inflation fourfold to nearly 40 percent in November. Currency fluctuations and the unstable economy have led to sporadic street protests since late 2017.

An IOM report in January noted that a big jump in the number of Afghans returning from Iran last year was “largely driven by recent political and economic issues in Iran including massive currency devaluation”.

Afghans typically took harsh, labor-intensive jobs in Iran and their departure will mean higher production costs, said Saeed Leylaz, a Tehran-based economist and political analyst, according to Reuters.

Over the past year, many Afghans in Iran have sought advice about returning from the office of Grand Ayatollah Mohaghegh Kabuli - a senior Afghan religious leader based in the holy city of Qom, according to an administrator in the office who asked not to be identified because of the sensitivity of the subject.

“With the crash of the value of the rial, staying in Iran has become very difficult for Afghan migrants,” he said. “They are under pressure.”

Naim, 18, followed the path of two of his older brothers and came to Iran from Afghanistan when he was only ten years old but quickly managed to find work in construction in Tehran.

The work was backbreaking and his family faced hardship: one brother lost four fingers in a construction accident in Tehran.

But he persevered, because he could make more money than at home, and eventually got a job as a doorman at a multi-story apartment complex in Tehran.

Last year, as the economic situation in Iran began to deteriorate, one of his older brothers decided he could no longer support his wife and six children and moved back to Herat in western Afghanistan.

“My brother’s wife and children were hungry and this currency has no value so they went back,” Naim said.

His brother started working in agriculture and has been able to open a small shop in Herat with his earnings. He is now pushing Naim to come home from Iran, a trip that he and approximately 150 friends and extended family are planning to take in two months.

“We work and we work and for what?” Naim said. “We have to go back.”

He could face an uncertain future once he returns.

“The economic opportunities in Afghanistan are no longer there. It’s not like there’s a lack of opportunities in Iran and new opportunities in Afghanistan,” said Sarah Craggs, IOM’s senior program coordinator for Afghanistan, who is based in Kabul. “There are no opportunities in either country really.”

Afghans have long sought better lives in other countries and a lack of jobs in Iran could also boost numbers trying to head further west to Europe.

The latest drop in remittances from Iran is already having an impact on the economies of the Afghan provinces of Herat, Badghis and Ghor, an IOM report said in January.

Abdul Saboor now earns about 130 dollars a month working at a restaurant in Herat.

“Life was much better in Iran but since the financial crisis, it was difficult to survive so we had to come back despite all the hardship here,” he said. “I was the lucky one and found a job while thousands of others are jobless.”



French Govt Faces Collapse after Opposition Says It Will Back No-Confidence Vote

Party leader of Rassemblement National (RN) Marine Le Pen (C) talks to journalists after the French National Assembly debate on parts of France's 2025 budget bill, in Paris, France, 02 December 2024. (EPA)
Party leader of Rassemblement National (RN) Marine Le Pen (C) talks to journalists after the French National Assembly debate on parts of France's 2025 budget bill, in Paris, France, 02 December 2024. (EPA)
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French Govt Faces Collapse after Opposition Says It Will Back No-Confidence Vote

Party leader of Rassemblement National (RN) Marine Le Pen (C) talks to journalists after the French National Assembly debate on parts of France's 2025 budget bill, in Paris, France, 02 December 2024. (EPA)
Party leader of Rassemblement National (RN) Marine Le Pen (C) talks to journalists after the French National Assembly debate on parts of France's 2025 budget bill, in Paris, France, 02 December 2024. (EPA)

The French government is all but certain to collapse later this week after far-right and left-wing parties said they will vote in favor of a no-confidence motion against Prime Minister Michel Barnier.

Investors immediately punished French stocks and bonds as the latest developments plunged the euro zone's second-biggest economy deeper into political crisis.

"The French have had enough," National Rally (RN) leader Marine Le Pen told reporters in parliament, saying her party would put forward its own no-confidence motion and will also vote for any similar bill by other parties. The left will also propose a similar motion.

"Maybe (voters) thought with Michel Barnier things would get better, but it got even worse."

Barring a last-minute surprise, Barnier's fragile coalition will be the first French government to be forced out by a no-confidence vote since 1962.

A government collapse would leave a hole at the heart of Europe, with Germany also in election mode, weeks ahead of Donald Trump re-entering the White House.

RN lawmakers and the left combined would have enough votes to topple Barnier. They now have 24 hours to put forward their no-confidence motions.

Their comments came after Barnier said on Monday that he would try to ram a social security bill through parliament without a vote after a last-minute concession proved insufficient to win RN's support for the bill.

French stocks reversed course, while a sell-off in the euro gathered pace and bonds came under pressure, pushing up yields.

The CAC 40 was last down 0.6%, having risen by as much as 0.6% after Barnier's concessions. The euro fell 1% and was heading for its largest one-day drop since early November. The yield on French government 10-year debt was up 2.7 basis points to 2.923%, having traded at a session low of 2.861% earlier.

'CHAOS'

Mathilde Panot of the left-wing France Unbowed, said: "Faced with this umpteenth denial of democracy, we will censure the government ... We are living in political chaos because of Michel Barnier's government and Emmanuel Macron's presidency."

Barnier urged lawmakers not to back the no-confidence vote.

"We are at a moment of truth ... The French will not forgive us for putting the interests of individuals before the future of the country," he said as he put his government's fate in the hands of the divided parliament which was the result of an inconclusive snap election Macron called in June.

Since it was formed in September, Barnier's minority government has relied on RN support for its survival. The budget bill, which seeks to rein in France's spiraling public deficit through 60 billion euros ($63 billion) in tax hikes and spending cuts, snapped that tenuous link.

Barnier's entourage and Le Pen's camp each blamed the other and said they had done all they could to reach a deal and had been open to dialogue.

A source close to Barnier said the prime minister had made major concessions to Le Pen and that voting to bring down the government would mean losing those gains.

"Is she ready to sacrifice all the wins she got?" the source close to Barnier told Reuters.