Iranians' demand for their leaders: Fix the economy

In the working-class neighborhood of Tehran surrounding Imam Hussein Square, side streets and alleys are lined with second-hand shops and small repair shops that refurbish all manner of household appliances. But with little to do, most shopkeepers idle outside their stores.

A 60-year-old man named Abbas and his son Asgar, 32, sat on two of the second-hand faux-brocade chairs they sell. When asked about their business, Abbas, who did not want his last name used for fear of attracting government attention, seemed incredulous.

“Just look down the street,” he said. “Business is bad. There are no customers, people are economically weak now, they have no money.”

After years of debilitating U.S. sanctions that have generated chronic inflation, compounded by Iran’s economic mismanagement and corruption, Iranians feel increasingly trapped in a downward economic spiral.

Virtually everyone interviewed during the six-day reportage in the Iranian capital described a widespread feeling of being economically out of touch, of becoming mere spectators rather than buyers, of having to repair used factory machinery because replacements are too expensive, of having to replace lamb with lentils.

Even in Tehran's upscale Pasdaran neighborhood, where chic cafes serve croissants and cappuccinos and boulevards are lined with grand Art Deco buildings, most Iranians, regardless of their political views, have one demand for the next president, who will be elected in a runoff election on Friday: fix the economy.

When asked how her business was going, Roya, a 25-year-old with a warm smile who runs a small cosmetics shop in a bazaar in northern Tehran, responded with one word: “Less.”

Yet, with shelves stocked with moisturizers, mascaras, blushes, and serums, the store seems to be thriving. So, what’s missing?

“There is less, less of everything: fewer customers, they buy less and imported cosmetics come from fewer places,” she said, after asking that her last name not be used because she feared reprisals from her boss or the government.

The French and German brands so prized by sophisticated Iranians have become too expensive for all but the wealthiest, he said.

Another thing missing from Iran's clogged roads is a wide variety of cars. Some are aging joint ventures with European and Japanese manufacturers after sanctions were eased, or domestically produced copies.

When President Donald J. Trump unilaterally withdrew the United States from the 2015 nuclear deal that Iran had negotiated with Western powers and reimposed sanctions on its banking sector and oil sales, much foreign investment was also lost.

At the same time, the trappings of wealth are still readily visible. Luxury consumer goods, including iPhones and designer clothes; Italian kitchenware and the latest German lamps are on sale in malls and boutiques in northern Tehran. Construction projects are underway in many neighborhoods. And despite relentless sanctions, the government has managed to expand its sophisticated uranium enrichment program.

Iranians' sense of their deteriorating economic situation stems partly from a contrast with the period between the 1990s and 2010s, when the middle class could count on its real income to rise every year.

Since then, apart from a small group of well-connected clerics and military personnel, along with an elite of high-ranking industrialists, developers and professionals who dominate the top of the economy, Iranians' incomes and assets have been dragged down by inflation and a weak currency.

While in 2000 there were about 8,000 Iranian rials per dollar, that number is now about 42,000 at the official rate and closer to 60,000 on the stock exchange. Inflation has stabilized but is still running at about 37 percent annually, according to the International Monetary Fund, a rate that would be unimaginable in the United States or Europe.

Despite strong headwinds, the country has managed to eke out economic growth of about 1.7 percent a year since 2010, when the Obama administration tightened sanctions over Iran's nuclear program. Economists say the growth is attributable to rising oil production and sales, mostly to a growing market in China, according to the Congressional Research Service.

“Sanctions have cast a long shadow over the Iranian economy, but they have not led to an economic collapse,” said Esfandyar Batmanghelij, head of the Bourse and Bazaar Foundation, an economic think tank focused on the Middle East and Central Asia. But achieving meager growth despite sanctions, he added, is little comfort to Iranians who are painfully aware of “how much is left on the table.”

The currency’s depreciation is so severe that when foreigners exchange, say, $100 for Iranian rials, they receive multiple bundles of thick bills, so bulky and heavy that they must be carried in a briefcase or backpack. The government has begun introducing a new currency, the tomam, officially worth 10 rials.

“Only those who have dollars are comfortable,” said Vahid Arafati, 36, as he sat in a cobbled square outside his small cafe, drinking espresso and freshly squeezed carrot juice with friends.

While the middle class talks about the cost of housing and how young people are postponing marriages because they can’t afford to buy a house, less fortunate Iranians, who live month to month on paltry wages and spend an average of 70 percent of their income on rent, face a far worse situation.

During last Friday's presidential election at Masjid Lorzadeh, a mosque in a poor neighborhood in southern Tehran, many people spoke angrily about U.S. sanctions and what they have done to Iran, but they also pleaded for Iran's next president to listen to their distress.

“I want the president to listen to my problems,” said Mina, a 62-year-old who, like most of the women present, wore a black chador from head to toe. “I live in a basement, I have children, they can’t find a job, I need surgery, but I came to vote anyway,” she said, shivering as she walked to the ballot box.

There is no limit placed on landlords on how much they can raise rents, leaving people like Mina in a constant state of anxiety, fearing they will be evicted from their homes due to high prices.

The woman next to her, Fatima, a 48-year-old housewife, was bitterly angry, especially at the United States for sanctions, which she blames for Iran's economic woes. “These problems, the sanctions are created by our enemies, but they will not succeed,” she said. “We will stab our enemies' eyes.”

Abbas, the chair salesman, has a different take on the economy. “Look, Iran is a rich country, but that wealth doesn't go into the hands of the people,” he said. “I don't know where it goes, I'm not the government, maybe they know where it goes, but every year it gets worse.”

“No president will help us,” he added. “The last president, when he came to power three years ago, a kilo of meat cost 100,000 tomams. Now it's 600,000 tomams.”

A few doors further on, in the workshop where the chairs sold by Abbas are restored, the atmosphere is even darker.

In the back, two workers sweated on the cushions they were rearranging, working quickly and without saying a word. They were educated, they said, but after years of declining fortunes, their families had been unable to make ends meet, and they had been forced to take whatever work they could find.

A third man, Mohamed Reza Moharan Zahre, 36, said he had finished high school and was ready to go to college, hoping to become a pilot. But his father’s carpet business was about to go under, so he dropped out to help out.

Now he says his only hope is to emigrate to Germany.

“Many of my friends have left the country. It's difficult to go legally, but what choice do we have?” he said. “I earn piecework, maybe $220 a month, and $180 goes to rent. I'm single, how can I get married? Iran is not a good place to earn money.”

Seddighe Boroumand, 62, a school janitor who stands just over 4 feet tall, nearly cried as she recounted how her diminishing ability to afford anything beyond shelter and food has torn the fabric of her life apart.

“My daughter died eight months ago because I didn't have the money to buy the medicine she needed,” Ms. Boroumand said. “She had a lung problem and couldn't breathe, I watched her gasping for air. And my first son had a heart problem and he died too. She had a baby and I pay for her baby.”

“My third son was drafted but he had a physical disability and we take care of him,” she added, nodding to her husband, who works at the same school as her.

“We ask politicians to put an end to the suffering.”

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