Food prices in Iran have almost doubled in a year. Pensioners fear slipping below the poverty line. Meanwhile, the government is investing in the defense industry.
Images and videos of repeated demonstrations by pensioners in Iran appear almost daily on social networks and Iranian media – even though the government continues to ban protest gatherings. Retired people are among those suffering most from the ongoing economic crisis and the problems of chronic mismanagement. Jafar Azimzadeh, pensioner, trade unionist and chairman of the “Free Workers’ Movement in Iran”, complained to DW that people were dissatisfied and that the political system did not have adequate answers to their problems. No country can be governed by oppression alone.
The massive increase in food prices is an existential problem for many pensioners. According to data from the Iran Statistics Center, food prices have risen by 80 percent within a year. This makes Iran one of the five countries with the highest food inflation in the world. This is mainly due to the massive depreciation of the Iranian currency. Iran relies on imports for many things, especially grain and vegetable oil, and has to pay for imports in foreign exchange at increasingly high rates.
Retirees report that they can only buy the essentials. A 73-year-old retired teacher says: “We haven’t been able to afford to travel for a long time. Spending time with relatives and children was our only joy. But now hardly anyone can afford to invite guests.” Many older people complain at the protests and in the media that they have slipped below the poverty line. According to official figures, around a third of the Iranian population lived below the poverty line in 2022. These people can no longer afford the necessary treatment costs in the event of illness, for example.
“Anxious, Stressed, Unhappy”
The Etemad newspaper reported in a lengthy feature on May 30 that inflation is making society increasingly angry, worried, stressed and unhappy. The post draws on statistics from the Institute of Forensic Medicine, which even found a direct link between inflation and an increased number of registered physical altercations across the country.
The government has announced that pensions and salaries will increase by 20 percent this year. However, an adjustment to inflation is far from in sight. The government’s budget depends up to 40 percent on income from energy exports. Tehran blames the problems on US sanctions on oil exports from Iran and is trying to strengthen its partnership with Russia and China.
In fact, Iran still exports a significant amount of oil. According to Reuters news agency, in December 2022 Iran exported an average of 1.14 million barrels of oil per day, more than in any other month in the past year. However, the quantities no longer reach the level of the past. After the conclusion of the nuclear agreement, oil exports rose to around two million barrels a day in 2016. Before the 1979 Islamic Revolution, Iran was selling up to six million barrels of oil a day.
rapprochement with China
With a trade volume of more than 25 billion euros, China is Iran’s largest trading partner and the main customer for Iranian oil. Beijing also intends to expand military cooperation with Iran, as announced after Iranian President Ebrahim Raisi’s visit to Beijing in February 2023.
Despite the economic problems, the Iranian government continues to invest heavily in the armaments industry. In late May, Iran unveiled the latest version of its LPG-powered ballistic missile, the Khorramshahr. Defense Minister Mohammad Resa Ashtiani stated that the Khorramshahr-4 could be ready for launch within a short time. On June 6, Iran also presented the first hypersonic missile developed in the country. President Raisi said on state television that the missile, dubbed “Fattah,” will increase the country’s strength, increase Iran’s deterrent power, and bring security and stable peace to countries in the region.
The expert Abbas Abdi writes in the Iranian newspaper “Hammihan” that society needs hope and recalls that during the election campaign President Raisi promised to bring inflation below 10 percent, create new jobs and promote economic growth. However, hardly anyone dares to openly criticize the country’s military activities.
According to the agency, the Fattah hypersonic missile that is now being presented should also be able to carry nuclear warheads. In response, the US imposed sanctions on more than a dozen individuals and entities in China, Hong Kong and Iran, including Iran’s defense attaché in Beijing. They accuse them of helping to procure parts and technology for Iran’s ballistic missile development.