Nazilafathi's Blog

All about Iran

Sanctions:Undermining Civil Society or the Regime?

The Sudden dive of Iranian currency against US dollar late last month has raised questions whether sanctions are undermining the Iranian civil society or its government. Thomas Edbrink wrote today in the Washington Post that the currency crash was a recent sign of the pressures by the sanctions.

Iranian Rial dropped by 15 percent for the first time in ten years against the US dollar on September 25, raising fears whether it would continue to lose its value. Importers have been faced with shortage of foreign currency and money changers in the capital refuse to do business, sources in Tehran said. A former Iranian source, who spoke on condition of anonymity for fear of retribution, said Iran’s central bank, which has the largest foreign exchange reserves, has trouble transferring dollars from abroad because of sanctions.

Thierry Coville argued in World Policy this week that the sanctions are undermining the country’s civil society as higher costs will spread to the rest of the economy while the government has sufficient petrodollar to survive.

“It is the Iranian worker or member of the educated middle-class which will suffer from a higher inflation rate, if the rial depreciation goes on,” wrote Mr. Coville. “The companies close to the Pasdarans and the Foundations have enough political backing to get access to the financing they need to survive in this difficult economic environment (they are controlling most of the illegal import networks which generate huge profits).”


Written by nazilafathi

October 6, 2010 at 7:46 pm

Posted in Uncategorized

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  1. […] correspondent of the New York Times (and current Nieman Fellow at Harvard) Nazila Fathi has a post up at her new blog pointing to an article on the World Policy Institute blog by Thierry Coville of the […]

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