The economic crisis that Iran finds itself in is of its own making. The country was under intense pressure since the Donald Trump administration in the US reimposed sanctions on the country in August 2018, and the situation was further aggravated recently when Iranian-backed Houthi group targeted Saudi Aramco oil processing facilities in Saudi Arabia.
The regime in Tehran cares little about its people and has been using its resources to fund expansionist policy in countries regionally. Its economy is in dire straits, and people are out on the roads protesting for a better life and living conditions.
The recent escalation between the United States and Iran, especially after the killing of the military commander Qassem Soleimani by American missile strikes near the airport in the Iraqi capital, Baghdad, has put Iran in a worse situation than before. The truth is, Tehran cannot confront a force the size of the United States. Its retaliatory attacks on the US bases in Iraq were an effort to save face in front of the Iranian people, and project that Iran will not bow down to the US. But for how long can it keep up the pretence is the question. US President Donald Trump is unlikely to remain silent for a long time if Iran continues to not play by the rules. Iran could suffer harsher sanctions, which would make the life of ordinary Iranians even more miserable. The only way out for Iran is to adopt the policy of appeasement with the US.
Oil exports, which are the main sources of revenue for the Iranian economy, have thinned since the US-led sanctions were reimposed. Trump had repeatedly stated that he would not be lenient with Iran if it continues to flout international rules of cooperation and continue to pursue its nuclear project. He reopened Iran's nuclear file despite the agreement signed between the two countries during the tenure of President Barack Obama and cancelled previous commitments, stressing that he would not allow Iran to complete its nuclear programme. Trump administration has raised the level of economic sanctions more than once. Yet, the rulers of Iran do not seem to cooperate, and insist that they would not stop the nuclear programme.
The problems between the two countries have never abated, and Iran's military actions in the region have made matters worse for them - so much so that the region was on the verge of turning into a real battlefield.
Military forces are still in their barracks, but that does not mean that the economic problems of Iran are over. The crisis is exacerbated, and the Iranian people are getting more agitated. Protests against the ruling elite confirm that the people are disgruntled and want Iranian government to take steps to improve the economic condition of the people.
Given the pent up anger and frustration among people, it would be difficult for the Iranian leadership to suppress demonstrations this time, like they have done in the past. And in light of economic crisis resulting from international sanctions, the situation is unlikely to change in Iran anytime soon. It is more likely that it will deteriorate.
The Iranian government might raise prices of good domestically to find an additional source of income, but that approach might not go down well with the people, as it happened last November when fuel prices were raised which led to the rise of prices of other commodities. People took to the streets in large numbers to protest against the government's policies.
The current year might not be a good one for the Iranian economy. Iran will most probably witness a further deterioration of its already weak economy. The only way out for the Iranian government is to make peace, not only with its neighbours but with the world at large. It should give up its nuclear ambitions of all kinds and start a new chapter.
Najwa Ibraheem Alzarouni is an Emirati writer
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