Ahmadinejad faces political battle over rial crisis

Amidst turmoil, Iranian lawmakers continue push to bring president before parliament for questioning.

October 10, 2012 04:16
3 minute read.
Iranian President Mahmoud Ahmadinejad

Ahmadinepoopoo with flag behind him 370. (photo credit: Screenshot)


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As Iran continued its struggle to regain control over its plummeting national currency on Tuesday, Iranian lawmakers said they would not back down from a motion calling for President Mahmoud Ahmadinejad to be questioned over the country’s economic crisis.

According to a Tuesday report by Iran’s Aftab News, which is linked to former president Hashemi Rafsanjani, a total of 94 Iranian MPs have now signed the motion.

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Under Iran’s constitution, a minimum of 74 signatures from MPs are required to call the president in for parliamentary questioning.

MP Mohammad Damadi, one of the sponsors of the motion, said that MPs intend to pass their proposals on to the Parliamentary Board next Sunday.

Damadi said that the questions would center on Iran’s economy and recent fluctuations in its currency markets.

Mansour Haghighatpour, deputy head of parliament’s foreign policy and national security committee, said the questioning of Ahmadinejad would move forward unless Supreme Leader Ayatollah Ali Khamenei opposes it, according to a report by the Iranian Labor News Agency.

Hagighatpour also said that the effects of the exchange rate fluctuations had impacted Iran’s internal security.

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“Ahmadinejad should be questioned about more than just economics,” he added.

Questioning the president would be one way to understand the causes of the currency crisis, Haghighatpour said, according to ILNA.

Ahmadinejad’s term of office expires in 2013, after which he cannot run for president again.

Despite his rhetoric abroad, Ahmadinejad is increasingly unpopular at home – during last week’s protests in Tehran against the plummeting rial, Iranians shouted anti-Ahmadinejad slogans, blaming his economic mismanagement for the crisis – and as pressure increases, some analysts are questioning whether he will manage to survive his final months in office.

According to US-based analysts The Soufan Group, although Ahmadinejad offered to resign last week during a Tehran press conference in which he lashed out at Iran’s lawmakers, judiciary and the Iranian Revolutionary Guard Corps, it is unlikely that Khamenei would accept his resignation.

“Ahmadinejad’s continuation as president allows public anger over the currency collapse to center on him rather than the supreme leader. This is despite the fact that it is Khamenei’s suspicions of a nuclear compromise that has led to the significant tightening of international sanctions, which, in turn, caused the rial’s collapse,” The Soufan Group said.

Iran’s currency turmoil continued on Tuesday, with the market exchange rate for the rial conspicuously absent from the country’s two main currency websites.

Both Mazanex and Mesghal blanked out exchange rates for the rial against the dollar and other foreign currencies including the British pound and the euro.

Although market rates for old gold coins were also missing from currency sites, reformist news sites reported soaring gold prices. According to Aftab News, gold coins were trading at 16 million rials on Tuesday morning, a significant increase from the rate of 11m. rials over the weekend.

Also on Tuesday, opposition website Kaleme claimed that a confidential report by Iran’s economic commission had warned that the country will run out of foreign currency reserves within the next six months, and that the exchange rate could spiral to over 67,000 rials to the dollar. On Tuesday, the free market rate hit an alltime low of over 35,500 rials to the dollar.

Kaleme’s report comes after a group of Iranian lawmakers asked the central bank last month to intervene in the currency market to support the rial, while Economy Minister Shamseddin Hosseini said Iran had enough foreign currency reserves to overcome the crisis.

However, Kaleme said the confidential report admitted that Iran’s foreign currency rates were insufficient.

According to Kaleme, the confidential report also warned of a risk of hunger riots, especially in the peripheral areas of large cities across the country, which it said could pose a threat to the regime.

Last week’s protests in Tehran could be the first in a series of riots that could spread to the poorer sectors of society, Kaleme said.

Iran’s currency crash comes amidst the effects of increasingly tough EU and US sanctions on Iran’s oil and banking sectors, which have significantly reduced income from the country’s oil-dominated industry and made it difficult for Iran to repatriate oil revenues.

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