Intelligence Agencies Minister Dan Meridor worked with French leaders in Paris
on Wednesday to stiffen sanctions against Iran, as riot police in Tehran clashed
with demonstrators rallying against the plunge in their country’s
currency.
“Now is the time to increase international pressure on Iran, so
that the Iranian regime understands that continued nuclear development endangers
its existence,” said Meridor as he addressed an institute for strategic studies
in Paris.
Meridor spoke about increased sanctions with French Foreign
Minister Laurent Fabius and Defense Minister Jean Yves le Drian.
Fabius
agreed that harsher sanctions were necessary, according to Meridor’s
spokesman.
France, along with the Netherlands, Germany and Italy, has
proposed harsher sanctions to the EU in advance of its October 15 meeting of 27
foreign ministers in Brussels.
The issue of stiffer Iran sanctions is
likely to be raised when the Italian cabinet and prime minister come to Israel
later this month. It is also likely to be on the agenda when Netanyahu leads his
cabinet to Germany in December.
In Tehran on Wednesday, protesters
denounced President Mahmoud Ahmadinejad as a “traitor” whose policies had fueled
their country’s economic crisis. Police fired tear gas to disperse the
demonstrators, who were protesting a 40% drop in their currency’s value against
the dollar in a week, witnesses said.
In a clampdown on the unofficial
foreign currency market, a number of traders selling dollars were arrested after
authorities ordered security forces to take action against those they see as
speculators.
The rial has hit record lows against the US dollar almost
daily as Western economic sanctions imposed over Iran’s disputed nuclear program
have cut the country’s export earnings from oil, undermining the central bank’s
ability to support the currency.
Panicking Iranians have scrambled to buy
hard currency, pushing down the rial – the increasing weakness of which is
hurting living standards and threatening jobs.
“Everyone wants to buy
dollars, and it’s clear there’s a bit of a bank run,” said a Western diplomat
based in Tehran.
“Ahmadinejad’s announcement of using police against
exchangers and speculators didn’t help at all. Now people are even more
worried.”
The protests are seen as posing a threat to Ahmadinejad rather
than to the government, which is expected to put a stop to the foreign exchange
black market, pump in funds to stabilize the currency and prevent the protests
from spreading.
Foreign Minister Avigdor Liberman, who has predicted that
the collapsing economy could lead to the regime’s demise, did not issue any
additional statements on the matter after he returned to Israel Wednesday
evening from a visit to the US.
Tehran’s main bazaar, whose merchants
played a major role in the country’s 1979 revolution, was closed on Wednesday. A
shopkeeper who sells household goods told Reuters that currency chaos was
preventing merchants from quoting accurate prices.
A computer dealer said
he had halted sales because of the volatility in the currency
market.
“The same product can change price within an hour,” he said by
telephone.
Protesters slam 'traitor' Ahmadinejad
The protests centered around the bazaar and spread, according
to the opposition website Kaleme, to Imam Khomeini Square and Ferdowsi Avenue –
the scene of bloody protests against Ahmadinejad’s reelection in
2009.
Protesters shouted slogans like “Mahmoud the traitor – you’ve
ruined the country” and “Don’t fear, don’t fear – we are all together,” the
website said.
The semi-official Mehr news agency said the largest
gatherings were around the currency-trading centers of Ferdowsi Avenue, the
Istanbul intersection, and Imam Khomeini Square. It said security forces had
been deployed to disperse the protests.
Iranian authorities currently do
not allow Reuters to report from inside the country.
The national
currency dived to a record low on Tuesday, to 37,500 rial to the US dollar in
the free market from about 34,200 rial at the close of business on Monday,
foreign exchange traders in Tehran said. On Monday last week, it traded at
around 24,600.
Ahmadinejad on Tuesday blamed the crisis on the US-led
economic sanctions against Iran and insisted the country could ride out the
crisis. He said security forces should act against 22 “ringleaders” in the
currency market.
Iran’s Supreme Leader Ayatollah Ali Khamenei, meanwhile,
struck a defiant note in a speech on Wednesday.
“The Iranian nation has
never submitted to pressures and never will, and this is why the enemy is
angry,” he said.
Mehrdad Emadi, an Iranian- born economic adviser to the
EU, said the slide in the rial had prompted many Iranians to try to limit their
losses by buying dollars.
“The rush out of the rial shows that everyone
wants to sell. But clearly it is going to make the life of ordinary Iranians
very painful and difficult,” he said.
The rial’s slide suggested the
Western sanctions were having a serious impact.
Many businessmen and
ordinary citizens say the government is at least partly to blame for the
currency crisis, and Ahmadinejad has been criticized by enemies in
parliament.
The rial’s losses accelerated in the past week after the
government launched an “exchange center” to supply dollars to importers of basic
goods. Businessmen say the center failed to meet demand for
dollars.
Websites providing rates for the rial stopped updating on
Tuesday, and Dubai money changers said they were not selling it because they had
lost contact with their Tehran counterparts.
US Secretary of State
Hillary Clinton held out the possibility on Wednesday that sanctions on Iran
could be eased quickly if Tehran were willing to work with major powers to
address questions about its nuclear program.
“They have made their own
government decisions – having nothing to do with the sanctions – that have had
an impact on the economic conditions inside of the country,” Clinton told
reporters when asked about protests sparked by the collapse of Iran’s
currency.
“Of course the sanctions have had an impact as well, but those
could be remedied in short order if the Iranian government were willing to work
with the P5+1 and the rest of the international community in a sincere manner,”
she added, referring to a group that includes the five permanent members of the
UN Security Council – the UK, China, France, Russia and the US – as well as
Germany.