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Books on Iran
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Update No: 064 - (28/03/07)
Sanctions to come
With Iran's failure to stop the uranium enrichment process on 21 February,
the country is definitely heading towards more Security Council - sponsored
sanctions. The US are pushing for an embargo on arms sales and on export
credits. The forthcoming sanctions are also expected to target industries and
businesses linked with the Revolutionary Guards, who control many of them, and
certain institutions allegedly linked with Iran's armament programs, such as the
Sepah Bank. Iranians, however, seem determined to pursue their path. A dispute
with Russia over the construction of the Bushehr reactor, now delayed again, is
only adding to the Iranians' revolve to become autonomous in this field.
Recently contradictory signals emerged from Washington with regard to the US
approach towards Iran. The state department accepted to take part in an
international conference on Iraq with Iran and Syria, but ruled out direct
talks. Moreover, the Bush Administration continued to wage a propaganda war
against both countries but particularly Iran. Commentators are divided with
regard to whether the participation to the conference is a first move towards
beginning to engage Iran or whether it is just an attempt to pretend to be
moving in that direction, while actually working in different directions. At the
same time reports concerning US and Saudi underground activities against Iran's
influence in the region have been surfacing in the media. Some source link the
disappearance of Deputy Defense Minister Ali-Reza Askari in Istanbul at the
beginning of March to these activities, although it might also be that Askari
simply 'defected'.
Some reform, much criticism
The Iranian government finally took the resolve to start addressing the
problem of excessive fuel consumption, introducing rationing and increasing the
price from US$0.09 to 0.11 per litre. Although the change is still modest, it is
a move in the right direction. Many observers assumed that given President
Ahmadinejad's populism the situation was going to remain frozen for some time at
least. Nonetheless, criticism of Ahmadinejad's economic management continues to
strengthen. In part this is the result of the reformists regaining some courage
to challenge the government, but the main factor has been the fact that former
president Rafsanjani has joined the ranks of the sceptics with public statements
about the excessive and growing reliance on oil revenue. Ahmadinejad is also
drawing criticism from the clergy because of his habit of discussing religious
issues, a topic which the clergy claims as its own exclusive domain.
Business-friendly Khamenei
Supreme Leader Khamenei once again took the lead on matters of privatisation
of Iran's industries in February, when he decreed that in accordance with the
constitution the privatisation should proceed. Several conservatives have been
objecting to Ahmadinejad's plans to privatise through the distribution of shares
to the population, arguing that this will not suffice to bring about a
substantial change in the economic performance of the companies involved. The
private sector is still struggling to assert its own role. Now for the first
time it might have the chance of seizing control of the Chamber of Commerce,
which so far has been controlled by the Islamic Coalition Society, a political
organisation created in the 1960s to support Khomeini. Following board elections
in February, independent businessmen have now a majority in the Chamber. The
elections witnessed a high participation, possibly a result of the widespread
desire among businessmen to ensure that the forthcoming privatisation of state
industries is fair and open.
Some signals have emerged in official statistics that economic malaise is not
just an invention of the anti-Ahmadinejad opposition. According to official
figures, several industrial sectors continued to register significant growth
rates this year, but others recorded a decline in production, as in the case of
aluminium, electronics and communications. The latest figures also show that
inflation is up to 13.4%, with a trend towards further increases.
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