By Poorang Novak
In May, U.S. President Donald Trump announced that the United States will be exiting the nuclear deal, meaning that crippling economic sanctions will be restored. On top of that, the U.S. State Department announced that it expects foreign countries to reduce their imports of Iranian oil to zero by November this year.
President Trump has kept up with the harsh rhetoric since then and has vowed to put the regime under as much economic pressure as possible to cut it off from the funds that allow it to spread terror across the region.
There have been threats being exchanged backwards and forwards between the presidents of the two nations, reminiscent of the heated exchange between President Trump and North Korea’s Kim Jong Un.
President Trump said last week that he would be prepared to meet with the Iranian president. He said: “Speaking to other people, especially when you are talking about potentials of war and death, and famine and lots of other things, you meet. There is nothing wrong with meeting.” Iran, however, has not been very open to the idea of a meeting with the U.S. President.
The economic crisis in the country is worsening on a daily basis and the national currency is freefalling. Last week the Iranian rial hit a record low of 120,000 to the dollar.
The Islamic Revolutionary Guard Corps (IRGC) warned President Hassan Rouhani that urgent and drastic measures need to be taken before the rial plunges even lower. The IRGC controls a large number of enterprises in the country, so much so that many talk about how it controls a large portion of the country’s economy.
The IRGC is set to lose a great deal if the currency crisis continues to worsen. This is great news for the rest of the world because it will have less funds in which it can finance terrorism and chaos across the Middle East.
The IRGC also warned President Rouhani that the protests that are continuing across the country have the potential to become more than the regime can cope with, and perhaps even more than the IRGC can control.
The regime is not going to go quietly. It will be kicking and screaming and will try to threaten its way out of the situation. However, this is not the kind of situation that the rest of the world wants to deal with. The Iranian regime can be unpredictable and it is worrying to think about what it is capable of when it is backed into a corner.
The Iranian regime needs to stabilise the rial otherwise complete control will be lost if the national currency is allowed to crash. It is unlikely that the Trump administration is going to do anything to stabilise the rial because doing so would be to save the Iranian regime. Perhaps the Europeans will step in? Perhaps they will take Washington’s side? In any case, Iran’s neighbours will be watching to see what happens. The fate of the Iranian currency will perhaps indicate the fate of the Iranian regime.