Iran on Edge
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|Golnaz Esfandiari||October 6th 2012|
The Iranian currency is in a free fall, the economy is in shambles, and Iranian citizens across the country are bearing the brunt. To get an idea of how average Iranians are coping with the currency crisis, we spoke to Hamid (not his real name), a student in his mid-20s who works in a computer shop near Tehran, and to Reza, a 20-something living in Iran's second city of Isfahan. Hamid says uncertainty, anxiety, and fear of the future have become part of the daily life of many middle-class Iranians and those from the lower strata of society.
"Life has become so difficult," he says with a sigh, lamenting that he and others are struggling to make ends meet. "We don't know what the future will bring. We actually don't even know how things will be in the next few hours," he says. "Our money has become worthless, affecting all aspects of life." Iranians feel the sting of the plunging rial when they go shopping. Prices of food staples and other goods, including imported medicines, have doubled or even tripled, in some cases. The price of home appliances and electronic devices has skyrocketed. Prices increase every day, Hamid complains.
"Let me give you a small example," he says. "I bought macaroni sauce for 11,000 rials the other day. The next night, the same sauce was 18,000 rials," he recalls. "When I told the shop owner that I had bought it the night before for 11,000, he said, 'May God bless last night. Do you have any idea how much the price of the dollar has increased since then?'"
Buying Less Or Nothing At All
About a year ago, the price of $1 was around 10,000 rials. This week, when the rial hit a record low, $1 traded for 36,000 rials. The collapse of the rial is blamed on the government's mismanagement of the economy and on economic sanctions imposed on Iran over its sensitive nuclear work. Hamid says many are coping with the crisis by buying less or depriving themselves of certain foods, like fruit, and nonessential items. "I eat meat only once every two weeks," Hamid says. "I can't afford it. If you see someone carrying several kilos of meat, you think, 'Wow, he must be rich.'"
The situation is also hurting businesses, including the computer shop where Hamid is employed. "A very simple printer that used to cost 1.4 million rials now costs 3 million rials. We can barely sell anything anymore. Before, when people's computer mouses would break, they would buy a new one," Hamid says. "Now they want us to repair it because they can't afford to buy a new one. A mouse used to cost about 50,000 rials; now it's about 190,000 rials. "
Hamid spoke on October 3, following a strike at Tehran's main bazaar and clashes between riot police and protesters who were angry about the plunging rial and the inefficacy of the government to deal with the crisis. He believes more unrest is yet to come. "People can't take it anymore," Hamid says. "This can't last for very long."
'Have To Support Government'
In Isfahan, where Reza lives, the falling rial has reportedly led to the closure of some gold and jewelry shops in the city's bazaar. Reza says many in the historic city are upset about the rising prices and the devaluation of the national currency, yet he doesn't believe protests such as the one in Tehran are likely to take place. "People in the Isfahan Province are very conservative," Reza says. "In the [Iran-Iraq war], they provided many martyrs (soldiers killed in the war with Iraq)." He adds that, despite the misery Iranians are facing, some Isfahanis, including his relatives, remain supportive of the clerical establishment.
"My grandfather is very upset about the rapidly rising prices. But at the same time he says that we have to support this government," Reza says. "When I tell him that the government has turned our life into hell, he still says that we should stand behind the [establishment]. For him, the opposition to the United States is key. He feels that if he doesn't support the government, he would be betraying the martyrs." In comparison to Hamid, who brings in a modest income, Reza is much better off. He works for a foreign company and gets paid in U.S. dollars. Yet even his purchasing power has significantly decreased because of the ailing economy.
"I go out with friends less than before," Reza says. "I was planning to travel abroad but had to cancel it, and I don't buy expensive clothing anymore. I wear the old ones." Reza's father receives a modest teacher's salary, and the family pads its income through other sources, such as a shop in the city.
"We were planning to buy some home appliances, including a freezer, but we decided to repair the old one," Reza says. "Before Nowruz (March 21), a freezer was 20,000,000 rials. Now it's 50,000,000 rials." Both young men know that they and their loved ones might have to tighten their belts further in the days and months to come.
Golnaz Esfandiari writes for RFE from where this article is adapted.