Iranians Reel from Economic Mafia, Currency Collapse

Sellers wearing masks in an Iranian fruit market (File photo: Reuters)
Sellers wearing masks in an Iranian fruit market (File photo: Reuters)
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Iranians Reel from Economic Mafia, Currency Collapse

Sellers wearing masks in an Iranian fruit market (File photo: Reuters)
Sellers wearing masks in an Iranian fruit market (File photo: Reuters)

A soaring food inflation and growing prices of real estate and home appliances has struck Iran, raising fear among the people along with their concern on the coronavirus pandemic.

Purchasing power saw a significant decline as the prices of fruits and vegetables continued to increase by 30 to 40 percent.

Economic sources said inflation is caused mainly by the collapse of the currency, the impact of the coronavirus, lack of state monitoring, and the presence of an “economic mafia.”

However, the sources believe that western sanctions imposed on the country are directly to be blamed for Iran’s economic hardship.

Iranians have called on the government to take effective measures to solve the deteriorating economic crisis, which has forced them to limit their purchases to essentials goods.

Economic reports showed that the prices of household appliances rose 30 to 60 percent, causing a decline in sales, at a time when smuggled foreign goods saw a 100 percent increase.

The Statistics Center reported that 30 percent of Iranian families lost the ability to buy home appliances and resort to the flea market for their needs.

In addition, the housing market recorded a strong decline. Media reports indicated that some Iranians, who have failed to pay their mortgages or rent, are now living in tents.

The value of the Iranian rial also continued to drop against the dollar and euro.

Social media activists said the sudden imbalance in the market, deteriorating living conditions, and rising prices have increased suicide rates.

Recently, an employee of the Azadegan oil field in the southwest of the country, committed suicide, sparking widespread controversy and prompting the oil minister to open an investigation.

Earlier, the Iranian parliament summoned Minister of Economy Farhad Dejpasand for questioning on the economic situation. Lawmakers issued a constitutional warning to Iranian President Hassan Rouhani demanding measures to stop the increase in prices.

Donyae Eqtesad newspaper reported that Rouhani asked the Undersecretary of the Industry Ministry to ensure close supervision and urgent intervention to regulate and control prices of household appliances.

Last week, the President formed a taskforce that includes the ministers of economy and transportation, and the governor of the Central Bank. Rouhani tasked them along with his first deputy, Ezhag Jahangiri, with searching for solutions to the fast rise in home prices.

Economic observers believe that Rouhani should have acted even before the re-imposition of US sanctions on Iran to regulate the housing market.



Netanyahu and Trump to Talk Tariffs, Iran and Gaza

Israeli Prime Minister Benjamin Netanyahu comes to Washington direct from a visit to Hungary. Attila KISBENEDEK / AFP
Israeli Prime Minister Benjamin Netanyahu comes to Washington direct from a visit to Hungary. Attila KISBENEDEK / AFP
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Netanyahu and Trump to Talk Tariffs, Iran and Gaza

Israeli Prime Minister Benjamin Netanyahu comes to Washington direct from a visit to Hungary. Attila KISBENEDEK / AFP
Israeli Prime Minister Benjamin Netanyahu comes to Washington direct from a visit to Hungary. Attila KISBENEDEK / AFP

Talks on Monday between Israeli Prime Minister Benjamin Netanyahu and US President Donald Trump are expected to be dominated by Washington's shock tariffs on Israel and escalating tensions with Iran.

Netanyahu becomes the first foreign leader to meet with Trump in the US capital since the president unveiled sweeping levies on multiple countries in his "Liberation Day" announcement on Wednesday.

Arriving in Washington direct from a visit to Hungary, Netanyahu's chief objective will be to persuade Trump to reverse the decision, or at the very least to reduce the 17 percent levy set to be imposed on Israeli imports before it takes effect.

Before leaving Budapest, Netanyahu said his discussions would include a range of issues, including "the tariff regime that has also been imposed on Israel".

"I'm the first international leader, the first foreign leader who will meet with President Trump on a matter so crucial to Israel's economy," he said in a statement.

"I believe this reflects the special personal relationship and the unique bond between the United States and Israel, which is so vital at this time."

Analysts said Netanyahu will seek to secure an exemption from the tariffs for Israel.

"The urgency (of the visit) makes sense in terms of stopping it before it gets institutionalized," said Jonathan Rynhold, head of political studies at Bar-Ilan University in Tel Aviv.

Such an exemption would not only benefit Trump's closest Middle East ally but also "please Republicans in Congress, whose voters care about Israel, but are unwilling to confront Trump on this at this point," he said.

Israel had attempted to avoid the new levy by moving preemptively a day before Trump's announcement and lifting all remaining duties on the one percent of American goods still affected by them.

But Trump still went ahead with his new policy, saying the United States had a significant trade deficit with Israel, a top beneficiary of US military aid.

Gaza truce, hostages

The Israeli leader's US trip is "also a way for Netanyahu to play the game and show Trump that Israel is going along with him," said Yannay Spitzer, a professor of economics at Hebrew University.

"I would not be surprised if there is an announcement of some concession for Israel... and this will be an example for other countries."

Netanyahu will also discuss the war in the Gaza Strip, the Israeli hostages still held in the Palestinian territory, and the growing "threat from Iran", his office said.

Israel resumed air strikes on Gaza on March 18, ending nearly two months of ceasefire with Hamas that had been brokered by the United States, Egypt and Qatar.

Efforts to restore the truce have since failed, with more than 1,330 people killed in renewed Israeli air and ground operations, according to the health ministry in the Hamas-controlled territory.

Palestinian Hamas group there still hold 58 hostages, including 34 the Israeli military says are dead.

On Iran, Trump has been pressing for "direct talks" with Tehran on a new deal to curb its nuclear program.

Iranian Foreign Minister Abbas Araghchi on Sunday rejected the idea of direct negotiations with the United States as "meaningless".

There has been widespread speculation that Israel, possibly with US help, might attack Iranian facilities if no agreement is reached.