Rohani Support Wave Matched by Task of Fixing Iran Economy
When Hassan Rohani won Iran’s presidential election this month, he garnered more votes than when his predecessor swept to power eight years before. He also gained a larger list of things to fix.
Rohani, 64, a lawyer, cleric and former diplomat, inherits an economy that under President Mahmoud Ahmadinejad was defined by falling oil exports because of international sanctions, accelerating inflation, a currency collapse and enduring unemployment. He’s also confronted by a political scene marked by squabbling over how to drag Iran out of the mire amid pressure from the U.S. and European Union over its nuclear program, which Israel has vowed to curb by any means.
“This Iran is going to be much harder to manage,” said Cliff Kupchan, director for the Middle East at New York-based political risk consultants Eurasia Group. “Rohani has much more of a mandate than Ahmadinejad had, while the country is in a lot more trouble today than it was in 2005.”
With Supreme Leader Ayatollah Ali Khamenei the final decision maker on key affairs of state, Rohani’s power to alter the nuclear policy and end the crippling sanctions is limited. Where he can make quicker inroads is by focusing on managing the economy better, narrowing political rifts and ushering in social changes such as less regulated Internet access and media, scaling back patrols of religious police and promoting women.
Rohani has already appointed a group to resume nuclear talks with global powers, Foreign Minister Ali Akbar Salehi said in Tehran, the Islamic Republic News Agency reported today. The foreign ministry is cooperating with the panel and the date and venue of talks will be set once Rohani takes over, it said.
Iran’s domestic situation is “directly linked to its foreign policy,” said Mahjoob Zweiri, a professor of Middle East politics at Qatar University in Doha. “The key issue, which is to fix the economy, or stop its deterioration, takes Rohani directly to the sanctions, the nuclear conflict and the international community.”
Oil revenue dropped 50 percent due to the sanctions, Economy Minister Shamseddin Hosseini was cited as saying by the Tehran-based Khabar Online website in December. The national currency, the rial, lost more than half its value in the past year, pushing the official inflation rate to 32.3 percent in April from 14 percent two years ago. The economy will shrink 1.3 percent this year, the International Monetary Fund predicts.
Rohani, who takes office in August, can overhaul some of the economic policies of Ahmadinejad, who pledged to spread oil wealth among the poorest, and shifted food and energy subsidies toward cash hand-outs. He was blamed by political opponents for failing to shield companies from the impact of rising costs.
“Under Ahmadinejad, Iran’s economy was founded on populism,” said Vali Nasr, the dean of Johns Hopkins School of Advanced International Studies in Washington. “Rohani needs to change the tenor of that.”
In his June 17 press conference, Rohani said capital must be unlocked and provided to firms for the economy to recover. He said his government will be based on “meritocracy” and go beyond divisions borne out of his predecessor’s time in the job.
Though Ahmadinejad kept support among the poorest, his confrontational rhetoric with western powers prompted more sanctions. Hundreds of thousands of Iranians protested in 2009 against his re-election, which was tainted by claims of vote rigging. Khamenei rejected the allegations.
“Ahmadinejad came to represent everything that had failed for Iranians, on the economy, in foreign relations and socially,” said Nazenin Ansari, diplomatic editor of the London-based weekly Farsi-language newspaper Kayhan. His time came to symbolize “one of paralysis and infighting that took the country in a downward spiral,” she said.
With a higher turnout, Rohani won more votes than Ahmadinejad received in a run-off in 2005, according to state-run Press TV news channel. Rohani got a surprise 18.6 million votes to win an outright majority of 50.7 percent of ballots.
Rohani heads the Center for Strategic Research at the Expediency Council, an advisory panel headed by Ali Akbar Rafsanjani, who served as president from 1989 to 1997. He also served as nuclear negotiator under former President Mohammad Khatami. Both men endorsed Rohani days before the June 14 vote.
Rohani is likely to form “a much more pragmatic and market oriented team compared to the populist Ahmadinejad” and pick ministers who served under Rafsanjani and Khatami for the next cabinet, Kupchan at Eurasia Group said.
One of the areas in which Rohani may be more successful in the short term is addressing what he criticized as the country’s “policed climate.” Iran’s government has been less tolerant of opponents since the 2009 street protests, which authorities claim were masterminded by Western states to undermine the Islamic Republic.
Officials have cracked down on journalists and holds more than 40 of them in jail, more than anywhere in the world except Turkey, the New York-based Committee to Protect Journalists said last month. Rohani could also work to reduce what he’s described as the government’s “attack against people’s privacy.”
Iran limits Internet speed for ordinary users and blocks social networking websites including Twitter and Facebook, which helped build momentum for the protests four years ago, as well as some foreign news sources such as BBC Farsi. Security forces regularly remove satellite dishes beaming foreign programs and challenge insufficiently covered women showing body contours or hair, citing the need to preserve morals.
Rohani, who on his Twitter account on June 23 said he plans to establish a Ministry of Women’s Affairs, may also address the needs of female Iranians who constituted more than half of the university graduates in 2009, according to the UN Education Scientific and Cultural Organization.
Progress may rely on Rohani’s ability to mend divisions after Ahmadinejad challenged Khamenei’s authority and engaged in public spats with heads of the parliament and Iran’s judiciary.
Parliamentary Speaker Ali Larijani met with Rohani a day after his victory, stressing their “long friendship,” Tehran-based Hamshari newspaper said. His brother, Sadegh Larijani, who heads the judiciary, also met with Rohani June 19, conveying a similar message, Press TV said.
Three-quarters of lawmakers underlined in a statement last week their readiness to back Rohani and work with him, Tehran-based Etemaad newspaper said June 18.
“The success of Rohani’s presidency depends on his ability to forge compromise and walk a very thin grey line,” said Kupchan at Eurasia Group. “Rohani has the background, temperament and connections to be a unifying figure if he plays a shrewd political strategy.”
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