Iranian President Mahmoud Ahmadinejad 370 (R).
DUBAI - Iran has been able to cope with Western economic sanctions and the central bank has supplied enough hard currency to finance imports even though the sanctions have cut Tehran's oil earnings, President Mahmoud Ahmadinejad said on Tuesday.
He was speaking after the Iranian rial plunged to a record low against the US dollar earlier in the day. It has lost about a third of its value in the past week, as panicking Iranians have scrambled to change their rial savings into hard currency to escape high inflation and further depreciation.
Iran's imports totaled $26 billion in the first half of this year, down only moderately from $29 billion in the same period last year, Ahmadinejad told a news conference.
"The central bank has provided all the currency for these imports," he said.
He said the country's enemies were waging a "psychological war" against it, adding: "Enemies have managed to reduce our oil sales but hopefully we will compensate for this."
Many businessmen and ordinary citizens in Iran blame the government for the currency crisis, and Ahmadinejad has been criticized for it by political enemies in parliament.
The rial has been depreciating for over a year and has lost about two-thirds of its value since June 2011. Its losses have accelerated in the past week after the government launched an "exchange center" to supply dollars to importers of some basic goods; businessmen have complained the center has failed to meet demand for dollars.
Ahmadinejad defended his economic record on Tuesday, saying a phase-out of food and fuel subsidies that he launched in 2010, which has boosted the official inflation rate to around 25 percent, had been successful.
"What is the subsidy reform? We are taking from the pockets of those who consume more to give to those who consume less," he said.Iran lawmaker: If talks fail, we will increase enrichment
Also Tuesday, an Iranian lawmaker said Iran would enrich uranium up to 60 percent purity if negotiations with major powers over its nuclear program fail, in comments that may add to Western alarm about Iranian intentions.
Mansour Haqiqatpour, deputy head of parliament's Foreign Policy and National Security Committee, said 60 percent enrichment would be to yield fuel for nuclear submarines, which often require uranium refined to high levels.
"In case our talks with the (six powers) fail to pay off, Iranian youth will master (the technology for) enrichment up to 60 percent to fuel submarines and ocean-going ships," Haqiqatpour said.
The powers should know that "if these talks continue into next year, Iran cannot guarantee it would keep its enrichment limited to 20 percent. This enrichment is likely to increase to 40 or 50 percent," he said.
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