Lawmakers Urge Ottawa To Be Firm With Iran Over Rights Abuses

The inflation rate reported by the Statistical Center of Iran (SCI) pertained to point-to-point calculation of rising prices, comparing the last Iranian calendar month of Khordad that ended June 20 with the same month in 2021.

Based on figures announced by SCI on June 22, overall point-to-point inflation rose by 52.5 percent, while non-food goods and services rose by 36.8 percent compared to the same month in 2021.

In early May, the government decided to end food import subsidies in place since 2018, that was allegedly abused by corrupt officials and businessmen to divert cheap dollars provided by the government, for non-essential imports.

The program of import subsidies cost the government $9-15 billion a year, depending on widely diverging figures quoted by different officials.

When the Iranian rial began to nosedive in early 2018, the government decided to offer cheap dollars for importing essential goods and commodities, such as wheat, animal feed, medicines, and a range of other items.

But rial’s decline continued without reprieve with the currency losing value ninefold by April 2022, as United States’ sanctions on Iranian oil exports and international banking imposed in 2018 continued.

Compared with the previous month this year (April21-May 20), the inflation index rose by 13.2 percent. But the shocking price jump was for the food sector with a 36.8 percent jump in one month.

However, the most politically significant and sensitive price increases were for cooking oil, bread and cereals.

Cooking oil jumped by 200 percent in one month and 250 percent compared with the same month in 2021. Bread and cereals jumped by 93.8 percent in one year and almost 20 percent compared to the previous 30-day period.

Dairy prices jumped by 47 percent in one month and 111 percent in one year.

However, the numbers published by the SCI still might not convey the real picture of rising prices. For example, in case of rents, the report showed an annual increase of 31.7 percent, while other reports speak of up to 100 percent rise in rental fees in the past few months, driving some lower middle class families into homelessness.

Protests began immediately in May after the government announced the elimination of food subsidies and have continued almost daily since then. Even government-controlled media are slamming the presidential administration for what they say is mismanagement of the economy.

Around 80 percent of the economy is directly or indirectly controlled by the state, which leads to planning nightmares, nepotism, political favoritism and corruption.

What helped the Islamic Republic to muddle through in past decades was oil export income, which has been significantly reduced by US sanctions imposed when the Trump administration withdrew from the 2015 nuclear agreement known as the JCPOA.

Year-long negotiations to revive the agreement have not succeeded, reportedly by Iran’s insistence for removal of sanctions imposed on its Revolutionary Guard, which is accused among other things of supporting terrorism.

With sanctions in place and an economy burdened by inefficiency, Iran’s financial situation will likely remain dismal, making the political atmosphere unstable in the country.

In a Tuesday interview with Tasnim news agency, affiliated with the Revolutionary Guard, Foundation of Martyrs and Veterans Affairs chief Amir-Hossein Ghazizadeh Hashemi said, "We still do not know the exact amount of damages and embezzlements that have occurred,” adding that “only one company has embezzled about five trillion tomans," or 50 trillion rials.

He did not mention the name of the company but said, "It was so big that we asked the security and intelligence services to intervene and investigate.”

The foundation has an economic wing that oversees dozens of companies with colossal amounts of assets that include the Kosar Economic Complex with dozens of companies, the Martyrs Foundation Property Organization, the Shahed Investment Company, Day Bank and Iran Zamin Bank.

About 10 years ago, the Iranian parliament formed a taskforce to probe the embezzlements at the Martyrs Foundation, but its final report was buried due to "political pressure.” The head of the taskforce later said that more than 30 people were involved in embezzlement only in the case of Day Bank.

Ghazizadeh said, "A large group of Day Bank executives have been arrested. This was just one example, now the same issues exist in the Kowsar Economic Complex and Shahed Investment Company as well as in other companies.”

In his first move after his appointment by President Ebrahim Raisi, Ghazizadeh asked the government to transfer the authority of the country's free zones to the Martyrs Foundation.

Yair Lapid, Israeli foreign minister and due to be prime minister when Biden arrives July 13, told US Secretary of State Antony Blinken by phone Tuesday that the president’s trip to Saudi Arabia and Israel “would have significant implications for the region and the fight against Iran, as well as immense potential to significantly improve regional stability and security," an Israeli foreign ministry statement said. Israeli Défense Minister Benny Gantz said Monday that Israel was building a US-sponsored air-defense system aimed at curbing drone or missile strikes by Iran and its allies.

Saudi Crown Prince Mohammad bin Salman was Tuesday in Egypt and Jordan, and is due to visit Turkey, repairing his image after the 2018 killing in Istanbul of Washington Post columnist Jamal Khashoggithat US intelligence concluded was done on the prince’s orders. In a move condemned by human rights groups, Turkey in April transferred the Khashoggi murder case to Saudi Arabia.

The Saudi crown prince, whose government has given significant financial support to the Egypt’s President Abdel Fattah al-Sisi who seized power in 2014 from the elected Muslim Brotherhood government, reportedly agreed $7.7 billion in agreements over food, transport, energy and pharmaceuticals. Egypt, the world’s largest importer of wheat, faces food shortages due to the Ukraine crisis.

While Saudi Arabia quietly favored Israel’s 2020 ‘normalization’ agreements with the United Arab Emirates and Bahrain, brokered by US President Donald Trump and advisor Jared Kushner, it has refrained from establishing diplomatic and formal ties with Israel.

Prince Mohammad’s first visit to Jordan came as Jordan's economy, like Egypt’s, struggles with the knock-on effects of the Ukraine war. Business leaders and officials expressed hope the Saudis will now deliver on past promises of $3 billion investment.

Summit Next Month

The Saudi crown prince and Jordan’s King Abdullah also discussed a summit next month where Biden will meet leaders of the six Sunni-led states of the Gulf Corporation Council, as well as Iraq, Jordan, and Egypt. King Abdullah is credited with the phrase ‘Shia crescent,’ which he used in 2004 to describe Iran’s growing regional influence.

Israel and the UAE inked May 31 a free-trade agreementfollowing up their 2020 ‘normalization’ agreement, and March’s meeting in Negev, Israel, of the foreign ministers of Israel, Bahrain, Egypt, Morocco, the UAE and the US, is planned as an annual event.

Israel and Saudi Arabia share concerns over Iran’s foreign policy os supporting militant proxies in the region, including Hezbollah and Ansar Allah in Yemen and have supported those who were willing to oppose Iranian influence. The Israeli and Saudi leadership have also opposed the 2015 Iran nuclear deal, from which Trump withdrew the US in 2018 and which the Biden administration says it wants to restore.

But while Biden came to office committed to recalibrating Washington’s links with Saudi Arabia, especially in asserting human rights, and initially dealt with Riyadh frostily, relations have thawed, partly as the US feels the need for increased Saudi oil exports to bear down on the rising cost of gasoline.

Domestic politics are also at work in Israel. The government Monday called a national election – the fifth in three years. Prime Minister Naftali Bennett has trumpeted a more assertive approach to Iran than opposition leader and former premier Benjamin Netanyahu, who hopes to return to power.

While there are Israeli security experts who see Bennett’s approach as counter-productive and who disregard talk of an Israeli-Sunni alliance, Bennett has used the phrase ‘Octopus Doctrine’ to describe drone or sabotage attacks on Iran’s nuclear and military sites, a campaign widely believed to also include killing scientists, engineers, and military officers.

With reporting by Reuters

According to Iran’s government news agency IRNA, the visit is aimed at boosting trade and energy cooperation as the two countries grapple with Western economic sanctions.

Lavrov is scheduled to meet Iranian Foreign Minister Hossein Amir-Abdollahian on Thursday and discuss expanding cooperation with the Eurasian region and the Caucasus, Iran’s Foreign Ministry said.

An exchange of opinion on a number of pressing international issues, including the Vienna talks to revive the Joint Comprehensive Plan of Action (JCPOA), as well as the developments in Ukraine, Syria, Afghanistan, Transcaucasus, Yemen and the Caspian Sea area will be discussed, the Russian ministry’s spokeswoman said.

Enjoying huge oil and gas reserves, the two countries are hit by sanctions that limit their ability to export their output. Last month, Moscow said Russia and Iran had discussed swapping supplies for oil and gas as well as setting up a logistics hub.

Earlier in June, Iran and Russia reached an initial agreement for launching a joint shipbuilding venture in the Caspian Sea region.

In January, Iran's President Ebrahim Raisi visited Moscow, where he presented his counterpart Vladimir Putin with draft documents on a 20-year strategic cooperation that would cement collaboration.

The visit took place in an atmosphere of heightened public debate over the Raisi administration's emphasis to reach a 20-year deal with Russia similar to the 25-year cooperation pact with Beijing signed in March which became operational earlier in the year.

According to an article published in Shargh Daily on Monday, the head of Iran’s Broiler Breeders Association, Mohammad Yousefi, says as the price of animal feed has increased by sixfold, poultry farmers are forced to sell their chickens at a loss in domestic market while Iran's export markets are becoming more and more limited.

Iraq, which is Iran's second largest export market overall after China with at least three to four billion dollars of trade per year, plans to reduce its imports to support its own producers.

Hamid Hosseini, a board member of the Iran-Iraq Chamber of Commerce and Industry, told Sharq that the Iraqi Ministry of Agriculture had repeatedly protested low tariffs on agricultural imports from Iran and called on the government to increase import tariffs. 

Shargh also quoted Mehdi Karamipour Moghaddam, a former secretary general of the Iran-Iraq Joint Chamber of Commerce, as saying that Iraq has set up more than 7,000 poultry farms with equipment purchased from Iran, resulting in an increase of egg production in the country from 1.5 billion in 2019 to 7 billion in the previous year. “Iraq almost no longer needs Iranian chickens and eggs, and sometimes issues short-term import permits” to meet temporary demands in the market.

Earlier in the week, Shargh reported that the sharp rise in animal feed prices has brought about a wave of bankruptcy among cattle breeders, forcing them to sell their starving or half-dead cows at lower prices to slaughterhouses.