Iran’s opposition leaders said Wednesday that a “dark future” awaits the economy because the government didn’t listen to economists when it slashed energy and food subsidies in a country already struggling under biting U.N. sanctions.
Former presidential candidates Mir-Hossein Mousavi and Mehdi Karroubi support the government’s effort to rein in subsidies but said in a rare statement posted on their websites that it is being implemented badly.
The opposition leaders, who believe President Mahmoud Ahmadinejad stole the June 2009 election through massive vote fraud, said the way the government is slashing subsidies only brings more hardship to the country. Fuel prices have at least quadrupled and bread prices have more than doubled in the past week since the government started dramatically reducing subsidies.
“Enforcing this plan, while Iran is facing tough international sanctions and its economy is in recession with an unemployment rate of over 30 percent and wild inflation, is a burden on medium and low-income families,” Mousavi and Karroubi said in a statement posted on kaleme.com. “Daily closure of factories and their inability to pay salaries on the one hand and exit of capital because of lack of investment security … on the other herald a dark future for the country’s economy. This gets worse when the government has no ears for the views of experts,” they added.
President Mahmoud Ahmadinejad has called the subsidy cut plan the “biggest surgery” in Iran’s economy in half a century and vowed to fully cut all subsidies by the end of his term in 2013. The government says it is paying some $100 billion in subsidies annually, although experts believe the amount is about $30 billion. Economists say the plan to slash subsidies could stoke inflation already estimated to be more than 20 percent. Experts say a gradual reduction of subsidies, not a sudden cut, is the best approach to tackling Iran’s economic woes.
Mousavi and Karroubi vowed to remain defiant, saying they already live in a “big prison” and it won’t be different if they will be put into an actual “small prison.” The two leaders are under close surveillance by security forces.
“Until today, we have remained steadfast in the path we’ve chosen. Also, we won’t give up this way, which seeks nothing but regain the rights of the people in the future,” they said.
President Mahmoud Ahmadinejad will be in Turkey today looking for at least moral support from his increasingly influential neighbor a month before nuclear talks with six major powers in Istanbul.
Iran’s agreement to hold another round of negotiations over its nuclear programme with Britain, China, France, Germany, Russia and the United States was the only tangible result of talks in Geneva this month. Hopes for a breakthrough are slight.
Iran had wanted to hold that meeting in Istanbul also, but the European Union, whose foreign policy chief Catherine Ashton is leading negotiations for the so-called P5+1, resisted as it saw Turkey’s involvement in the talks as a complicating factor.
Ahmadinejad’s official reason for going to Turkey now is for a meeting that also includes Pakistan, Afghanistan and Central Asian states, but he will also have one-to-one talks with Turkish Prime Minister Tayyip Erdogan.
“I assume the nuclear talks Turkey will host in January between Iran and the powers will be part of the agenda, but will not be the only topic on the agenda,” said Turkish Foreign Ministry spokesman Selcuk Unal.
After years of successfully exploiting the divisions within U.N. Security Council to side-step hard-hitting sanctions, Iran was subjected to a series of U.N., U.S. and EU injunctions from June directed at its important energy sector.
While Iran has insisted sanctions are having no effect, political analysts say the unexpected severity of the measures is an important factor in bringing Tehran back to talks. Feeling isolated, Iran is once more looking to its increasingly economically powerful and diplomatically assertive western neighbor to help relieve the pressure.
“Despite all of Iran’s bluster and pretence of being so confident, … the Iranians are suffering from a sense of loneliness and a significant distrust of the other states in the P5+1 which makes it extremely difficult to agree to anything,” said Trita Parsi, a U.S.-based Iran expert.
Turkey’s governing AK Party, which emerged from a series of banned Islamist movements, has reached out to the likes of Iran, Syria and the Palestinian movement Hamas, and stood up to U.S. ally Israel, enhancing Erdogan’s popularity in the Middle East. Ankara’s policy of having “zero problems with neighbors” has alarmed some in the United States who would like to see its NATO ally lining up squarely behind its plan of isolating the Islamic Republic, but it has also given Turkey, in Iran’s eyes, the credibility to act a mediator in the nuclear dispute.
Ahmadinejad’s visit also comes at a time when Iran’s foreign policy, according to some analysts, is in some disarray. He unceremoniously sacked his foreign minister last week, replacing him with a close ally, nuclear chief Ali Akbar Salehi. At least part of the reason for the change was that the outgoing minister, Manouchehr Mottaki, had “harshly criticized the president for setting up a parallel diplomatic apparatus,” said Khabaronline, a website close to the government. Ahmadinejad had appointed a series of envoys, sending them on diplomatic missions, independent of the Foreign Ministry. To complicate matters further, Supreme Leader Ayatollah Ali Khamenei, the most powerful figure in Iran, sent his own foreign policy adviser to Turkey last week to meet Erdogan. The newspaper Kayhan, controlled by Khamenei, criticized the manner in which the president sacked Mottaki, giving rise to some analysts seeing a possible division between the two. It was not clear if Ali Akbar Velayati’s visit to Turkey was merely ceremonial or yet another strand to Iran’s foreign policy.
Salehi spoke of Turkey’s growing importance at his inaugural address on taking up his new job. It is possible Iran will formally ask Turkey to take on the role of mediator with the P5+1, or perhaps join the already unwieldy group.
Turkey, for its part, says it is willing to help.
“Turkey is hosting the meeting. If we are asked to do anything else we will do our best,” said Foreign Ministry spokesman Unal.
source: Reuters
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