A woman shopping in Tehran with Iranian currency in hand

Iran Officials Express Concern Over Economic Crisis, Hyperinflation

Saturday, 05/27/2023

While some Iranian officials are concerned about economic hardship and fear a looming hyperinflation, others claim there are plans under way to fix the situation.

The differences in opinion among officials about the economic crisis has surfaced in the media while the current government is halfway through its four-year term of office.

Expediency Council chief Sadeq Amoli-Larijani warned in an interview with Etemad Online that Iranians are finding it increasingly difficult to cope with their financial hardships and the government needs to take urgent measures. Amoli-Larijani said that he has informed officials of the alarming state of the economy.

He said the situation is so urgent that officials must come up with immediate, short-term solutions to tackle the country’s economic problems. 

Supreme Leader Ali Khamenei (left) and Expediency Council chief Sadeq Amoli-Larijani

Iran’s currency has lost half its value in less than a year and millions of people have sunk into poverty. Iran has refused to reach a nuclear deal with the United States, which could lift crippling economic sanctions.

Meanwhile, former lawmaker Ezzatollah Yousefian-Molla told Nasmeh News that Iran's economy will face hyperinflation starting in June. He said the rise in prices between May 2022 and May 2023 is unbelievable. According to the Iranian Central Bank, the point-to-point inflation between those two dates has been over 55.5 percent. Others have offered higher estimates approaching 70 percent.

Yousefian-Molla suggested that the government had better not announce inflation figures under the circumstances. He warned the situation is getting even worse. He even said that Supreme Leader Ali Khamenei’s latest speech to Iranian diplomats about changing Iran’s diplomacy was alluding to the fact that something needs to be done to improve the status of the economy.

He added that Iranians are finding it increasingly difficult to make ends meet although they do their best to spend less. Even prices of bread, cheese and eggs have skyrocketed. In such a situation, he said, the people will not believe government lies about economic growth.

Former lawmaker Ezzatollah Yousefian-Molla

Despite the warnings, vice president for economic affairs Mohsen Rezaei says economic reforms are on their way. However, he admitted that the current situation is “painful” for the people. Meanwhile, despite being a member of the government, he criticised the government for not keeping up with technological progress. 

He also criticized Iranian governments during the past 80 years for trying to take over exisiting companies and factories rather than genuinely seeking to make Iran an industrial country. Rezaei added that the factories the government has established are on a declining course. 

He maintained that Iran has been successful only in defense industries. “In other areas, we have spent a lot of money and energy while we did not have enough progress.” He further boasted that “Big powers fear our defence industries.” 

He also criticized the budgeting system in Iran and said the government allocates budget but has no idea from where the funding should come. Rezaei added that Iran’s banking system also needs to be reformed to be compatible with international standards.

Meanwhile, he blamed the people for the lack of economic progress saying that the country needs economic reforms, but implementing those reforms will lead to protests.

In another development, the Speaker of the Iranian Parliament Mohammad Bagher Ghalibaf said in an interview with the IRGC-linked Tasnim news agency that “I promise to bring about economic stability with a five-year plan to overcome inflation.”

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