Last December and January saw the outbreak of popular protests which began spontaneously in the holy city of Mashhad, but quickly engulfed at least 140 cities and towns. The protests were rooted in Iran’s dire economic circumstances that keep ordinary Iranians in poverty, including those outside of Tehran — farmers, coal miners, and other workers.
These protests have grown to include broad cross-sections of Iranian society. Most recent are the protests at the Grand Bazaar in Tehran, that displayed the frustration of Iranian business owners and merchants over the enormous drop of the Rial against the US dollar, which is said to be worth 90,000 rial.
The regime now seeks to halt trading in dollars and has banned the import of 1,300 foreign goods such as household appliances and consumer technology products.
Clearly, the exit from the Iran nuclear deal by the Trump administration, and the reinstatement of economic sanctions, has also affected the Iranian economy. Many business deals have been canceled after a warning from the U.S. State Department that companies currently buying Iranian crude oil must completely cut those exports by November this year or face sanctions.
According to a a State Department official, the administration does not expect to grant waivers to companies that purchase Iranian oil or invest in its energy industry, which would put companies in a precarious position should they choose to continue doing business with the Iranian regime.
A senior Revolutionary Guard Corps commander told Iranians in a televised statement, that they were duty-bound to help the regime overcome its economic problems. “It is our duty to work in coordination and synergy to help the government and other branches overcome economic woes and foil enemy plots for an economic war and psychological warfare,” said Gen. Yahya Rahim Safavi, a military adviser to top mullah Ali Khamenei.
Iranian President Hassan Rouhani sent letters to France, Germany, and Britain listing demands that would keep Iran in the nuclear deal, in an attempt to keep an economic lifeline open. The letters were not made public, but Rouhani likely demanded that these countries keep their commitments for EU companies to continue fulfilling business deals, as well as continue buying Iranian oil.
In an example of the regime’s economic desperation, government spokesman Mohammad Baqer Nobakht called on diaspora Iranians to “bring their money to Iran” and urged all Iranians to invest their cash and gold into the economy.
A record amount of capital, $27 billion, was taken out of the country last year, reported the International Monetary Fund. In a sermon celebrating the end of Ramadan, Supreme Leader Ali Khamenei called on Iranians to stop taking leisure trips abroad, to make sure no more foreign exchange leaves Iran, according to the New York Times.
Rouhani promised that his government would cut spending, reduce international travel, and fly economy class to ease the burden on the public. He added that his government would import raw materials at affordable prices to help domestic manufacturers and ensure supply for Iranians. He also urged ministries to issue government bonds to give people alternatives to the dollar and the euro for investing their assets.