Cleric Confirms Iran Government Spent Two-Thirds Of Reserve Fund
Interim Friday Prayer Imam of Tehran, Hassan Aboutorabi-Fard, stated that the government has not returned $100 billion it withdrew from Iran’s National Development Fund (NDF).
Interim Friday Prayer Imam of Tehran, Hassan Aboutorabi-Fard, stated that the government has not returned $100 billion it withdrew from Iran’s National Development Fund (NDF).
This is tantamount to two-thirds of Iran’s aggregate reserve fund which was estimated to be as high as $150 billion.
“Even the resources granted by the NDF to the private sector have not been reimbursed,” added Aboutorabi-Fard, who holds a considerable sway in Iran as he is a member of the inner circle of Supreme Leader Ali Khamenei.
The NDF was established in early 2000s to save part of oil revenues for future generations and Iran’s development.
He criticized Iran’s oil-based economy in which prices of goods are fixed by the state. He emphasized that the country’s economy needs to move away from its dependency on oil and fossil fuels revenues towards knowledge and technology.
“The share of research in Iranian companies should be four percent today, whereas it is less than one percent,” Aboutorabi-Fard warned.
According to a report by the Iranian parliament’s research center released in August, as stringent international sanctions struck Iran during 2011-2013, the administration of former president Mahmoud Ahmadinejad initiated withdrawals from the NDF.
Despite the end of sanctions in 2015 after a nuclear agreement, withdrawals from the NDF persisted throughout President Hassan Rouhani’s two terms (2013-2021). In his initial presidential tenure, $30 billion was withdrawn. However, as former US President Donald Trump abandoned the JCPOA and re-imposed sanctions, the Islamic Republic increasingly relied on its reserves, resulting in a negative cash flow in the NDF.
The pace of withdrawals accelerated further under the hardliner president Ebrahim Raisi.
The ministry argued that Iran’s 2015 JCPOA nuclear deal with world powers removed all sanctions, and Iran should not be economically penalized by the FATF.
The Financial Action Task Force (FATF) is a global body combating money laundering, terrorist financing, and proliferation of weapons of mass destruction. FATF Recommendations set international standards for anti-money laundering (AML) and counter-terrorist financing (CFT). The Convention against the Financing of Terrorism (CFT) targets terrorism financing, and the Palermo Convention (UNTOC) addresses transnational organized crime, including money laundering and human trafficking. These measures enhance transparency, traceability, and accountability in financial transactions to prevent illicit use of financial systems.
President Raisi administration is skeptical about Iran joining the FATF, as it has kept Iran on the organization's blacklist since February 2018. Raisi contends that focusing on relationships with "neighbors and friendly" nations is a better course of action than the previous administration's “obsession” with membership in the FATF.
The Rouhani administration in 2017 proposed a series of bills to parliament to enact legislation that would bring Iran’s financial regulations in line with those of FATF. However, hardliners prevented final adoption of those laws and Iran remained on the watchdog’s blacklist.
Considering the Raisi administration's shift in approach and the acknowledgment by Mohammad Sadr, a regime insider that there is potential for progress in addressing the FATF issue, especially with the current economic challenges facing the government.,
The letter from the Minister of Economy of Iran was sent at a time when some economists in Iran express skepticism about the efficacy of such correspondence in resolving the FATF issue. To address the problem, it is crucial to first clarify Iran’s position toward the CFT (Counter Financing of Terrorism) and Palermo conventions. Economist Vahid Shaghaghi speaking to media in Tehran emphasized that without approving the Palermo and CFT bills, Iran's request will not be taken seriously. Only after the approval of these two bills can Tehran proceed to write a letter requesting the removal of Iran's name from the blacklist. Even in that case, it may take 2 to 3 years for Iran to be added to the gray list.
Whether these bills are approved or not is a complex matter, because there is a disagreement over the essence of words and terms. Iranian hardliners are concerned that adhering to international standards against money laundering and terrorism financing will interfere with the regime’s efforts to support its militant proxies in the region. The Lebanese Hezbollah, Hamas and others are either officially labeled terrorist or are under severe surveillance as terror operatives.
The core of the Iranian regime is reluctant to join the FATF and follow international financial standards and conventions, even after the government submitted four proposals in 2017 to incorporate FATF criteria—two of which were rejected by the hardline Guardian Council. While opponents claim that compliance limits support to recognized terrorist groups and exacerbates political tensions, Iranian officials realize the economic difficulties linked to non-adherence. Some argue that these steps must be taken immediately, pointing out that Iran cannot conduct international banking or trade without FATF clearance, even if sanctions are repealed.
So far, Iran's Foreign Ministry Spokesman Nasser Kanaani has provided the most "critical" response to the Western air strikes. He strongly condemned the military action and claimed that they only divert attention from the "crimes" in Gaza and "have no result other than fueling insecurity and instability in the region."
In a reaction that can be evaluated as relatively mild, Iran’s Foreign Minister Hossein Amir-Abdollahian wrote on X that Houthis are committed to maritime and shipping security in the region.
Since mid-November Iran’s Yemeni proxies have launched dozens of missile and drone attacks against international commercial vessels in the Red Sea, after the Supreme Leader in Tehran called for a blockade of goods to Israel.
“Instead of a military strike on Yemen, the White House should immediately end all military and security cooperations with Tel Aviv against the people of Gaza and the West Bank,” stated Amir-Abdollahian, adding that only then, security will be restored across the region.
Iran’s Supreme Leader Ali Khamenei and top IRGC commanders have not yet made any comments on the strikes.
Likewise, state-sponsored media in Iran have also provided limited reporting on the events in Yemen, mostly repeating stereotypical statements made by the Islamic Republic, Houthi officials, and Tehran’s allies in the region.
IRNA, the Iranian state news agency, covered the condemnation of the attacks by Syria, Oman and Iraq’s Hezbollah, a Tehran-backed militant group.
In an article released on Friday, IRNA called the US and UK airstrikes against Houthi targets “the escalation of tensions by cowboys,” warning that the offensives “can further complicate the spiral of instability in the region and increase the risk of expanding the war.”
Other state-sponsored and military-affiliated news agencies in Iran such as Fars, Mehr, and Tasnim, have adopted a similar stance by reiterating the familiar “the enemy will be conquered” rhetoric while avoiding any straightforward pledge regarding the Islamic Republic’s direct interference in support of Houthis.
Tabnak news website, reportedly owned by Mohsen Rezaei, a former IRGC commander, conducted an interview with Heshmatollah Falahatpisheh, a former lawmaker. Falahatpisheh, who once served as the head of the National Security and Foreign Policy Committee of the Iranian parliament, claimed that Saudi Arabia greenlit the recent attacks on Yemeni Houthis.
Citing Saudi Crown Prince Mohammed Bin Salman, Falahatpisheh stressed that Riyadh is still willing to normalize relations with Israel despite the war in Gaza.
Relatively independent media in Iran, nonetheless, can be said to adopt a more analytical approach toward the escalation of the tensions in the region. KhabarOnline news website predicted on Saturday that the Islamic Republic will not enter the war as it is “mired in complex internal issues” that it has yet to resolve.
The tension and conflict in the Red Sea will continue “on a normal, and not very heavy, scale,” added the report by Khabaronline, further noting that the US, Britain, and NATO will avoid a full-scale, long-term, ground war against Houthis as they believe it will benefit Russia and China.
Meanwhile, Fereydoun Majlesi, a former Iranian diplomat, said that the recent strikes in Yemen were predictable because targeting commercial vessels in the Red Sea affected a large variety of players across the region and the whole world.
“The Red Sea is not just a cargo route for Israel’s port of Eilat, but a transit route for oil and other commodities to go through the Suez Canal,” Majlesi told Rouydad24 news website, adding that US President Joe Biden has been under the pressure of the Republicans to respond to the Houthis.
The most controversial stance among Iran’s relatively independent media belonged to Donya-e-Eqtesad daily which covered the attacks against the Houthis under the headline, “The US Sealed Yemen’s Fate.” Kayhan daily, the regime's most uncompromising media outlet, severely criticized Donya-e-Eqtesad's title, saying it shows that some newspapers that serve the US and NATO's interests are still active in Iran.
The US and UK strikes came two days after the UN Security Council passed a resolution, calling on Yemeni Houthis to stop attacks on shipping in the Red Sea immediately.
Biden issued a veiled threat to the Islamic Republic following the strikes. Asked by a reporter if he had a message for Tehran in the light of the attack, Biden said “I’ve already delivered the message to Iran. They know not to do anything.”
On Thursday, the leader of Iran-backed Houthis warned that the group is ready to respond to any “US aggression.”
We will continue “to fulfil our duties with regard to Palestine” despite the efforts by Washington and London to protect Israeli and Israel-related ships in the region, Abdul-Malik al-Houthi stressed, adding that Houthis will do “what is necessary” in the case of a “direct confrontation” with the US.
