Iranian currency crash sparks rising fears on streets of Tehran
Essential items such as nappies have vanished from shop shelves in the capital.
Iran’s rial has fallen to a record low as worried residents of Tehran queued up outside beleaguered money changers.
The currency has seen a staggering 140% drop in value since America pulled out of a landmark nuclear deal only four months ago.
Those who went to work at the start of the Iranian week on Saturday saw their money shed a quarter of its value by the time they left the office on Wednesday.
Signs of the currency chaos can be seen everywhere in Tehran, where travel agents offer holiday prices only in hard currency and nappies have disappeared from store shelves – something acknowledged by the supreme leader.
Many exchange shops in Tehran simply turned off their electronic signs showing the current rate for the US dollar, while some Iranians who want hard currency sought out informal money traders on street corners.
Exchange shops that remained open offered 150,000 rials to the US dollar.
Iran’s economy has faced troubled times in the past, whether from the shah overspending on military arms in the 1970s or the Western sanctions following the 1979 Islamic Revolution and US embassy takeover.
Drastic fluctuations in oil prices have also taken a toll.
This time, however, the currency has crashed along with hope many felt following the 2015 nuclear deal Iran struck with world powers, including the administration of then-US president Barack Obama.
Iran agreed to limit its enrichment of uranium in exchange for the lifting of some sanctions. The West had feared Iran would use its nuclear material to build atomic bombs, while Tehran has always insisted its activities are purely peaceful.
In May, despite the United Nations repeatedly acknowledging Iran had lived up to the terms of the deal, US president Donald Trump withdrew America from the accord.
He said he wanted stricter conditions placed on Iran that included limiting its ballistic missile programme, curtailing its regional influence and forever limiting its nuclear activities.
While European nations say they want the deal to continue, America’s enormous influence in global financial markets led oil companies and aeroplane manufacturers to quickly withdraw from working in the country.
Harsher sanctions loom in early November, including those targeting Iran’s oil industry, a key source of hard currency.
The Trump administration denies it is seeking to overthrow Iran’s government through economic pressure, but Iranian officials say the link is clear.
Ayatollah Ali Khamenei, Iran’s supreme leader, called the US moves economic “sabotage” this past weekend, and specifically mentioned the nappy shortage. Some 70% of material for disposal diapers is imported. As the rial falls, it makes purchasing the material from abroad more expensive.
“Imagine that in Tehran or other major cities, baby diapers suddenly become scarce. This is happening, this is real, this is not make-believe,” Khamenei said, according to a transcript on his official website.
In making a direct reference to nappies, he said: “This makes people angry. On the other side, the enemy wants people to be angry with the government and system. This is one of their ways.”