Iran’s President Faces Four Major Disagreements With Parliament

Borna news agency has reported that a man behind three companies licensed to build the project is a shady character who already owes a lot of money to government banks.

President Ebrahim Raisi ordered a new halt to the controversial petrochemical project until "ambiguities about its environmental impact" are removed, interior minister said Sunday.

On April 10, after intense controversy over the environmental impact of the project and shady records of the company behind it, Raisi called an immediate halt but media reports said the company has continued construction on the 90 hectare site close to the Miankaleh UNESCO-designated biosphere reserve.

Environmental activists have been campaigning to stop the project due to expected adverse impact on the coastal region and its wildlife and have even urged Supreme Leader Ali Khamenei to intervene. The land earmarked for the project is also said to be high-quality agricultural public land.

Borna news agency said Foulad Alborz Iranian (FAICO), one of the subsidiaries of Amirabad-e Mazandaran Limited, is at the top of the list of individuals and companies which owe massive sums to the government-owned Tose'e Saderat Bank. Iran's state banks have been publishing lists of their 'super borrowers' with largest debts this week.

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Borna said it had acquired documents that showed the guarantee for the payment of the loans had been made by the company's major shareholder, Abbas Abdi, who is also a major shareholder of several other companies active in Mazandaran Province including those involved in the petrochemical project.

Individuals and entities who borrow large sums from state banks through their connections with politicians, bureaucracy or the military are known as ‘super-borrowers’ in Iran. They usually get the multi-million-dollar loans pretending to have job-creating projects, but often use the money for other purposes or simply take it out of the country and never repay. The same connections they have, often protect them from prosecution and at most they lose worthless collaterals to banks. It is believed that officials who help ‘super-borrowers’ have a stake in the schemes.

The news agency also published the image of a ruling by the justice department of Tehran that shows Abdi was sentenced to seven years in prison for fraud in 2020, in absentia. No one knows if he is now in Iran or not.

Borna said FAICO owed over 13 trillion rials ($52 million in current exchange rate) to Tose'e Saderat Bank for two foreign currency loans it received at government subsidized rates in 2016, and the interest and that the collateral offered by Abdi for the loans is worth only one-third of the sum of the original loan.

The report also suggested that Abdi who has a record of failing to pay back huge loans as well as fraud was helped by persons or entities in powerful centers to get the license to launch the petrochemical megaproject.

Several powerful figures including Parliament Speaker Mohammad Bagher Ghalibaf, the governor of Mazandaran Province and the Friday Prayer Imam of the region have strongly and publicly defended the project and some hardliners have gone as far as saying opponents of the project are in essence opponents of the Supreme Leader, thus trying to accuse them of a political crime.

Lawmaker Alborz Hosseini warned the president and his economic team in a speech Sunday about the rising cost of living. He called the daily increase in food prices a "tsunami" and added that rents were rising uncontrollably. "It seems that nobody is thinking of vulnerable classes."

"Food on people's tables is becoming scarcer by the day and cars have become a commodity they cannot hope to own," Fathollah Tavassoli, another lawmaker, told the Parliament.

In his pre-agenda speech Sunday, Parliament Speaker Mohammad-Bagher Ghalibaf blamed previous administrations for inflation which according to official figures has now risen above 40 percent and urged the government of President Ebrahim Raisi to take action to bring the hike in prices under control.

Ghalibaf, apparently still tries to protect Raisi from rising criticism, but others say blaming the former government is simply not an answer to the crisis.

Raisi has not been able to achieve much since last August when he took office, except more clandestine oil exports to China because of less strict US implementation of sanctions by President Joe Biden’s administration. Raisi government officials boast having doubled oil exports.

But many are now asking why higher oil sales have made no difference in the economy. The government mouthpiece, Iran newspaper, said this week oil revenues are spent to offset part of the 4.7 trillion rial budget deficit inherited from the government of former president Hassan Rouhani.

The newspaper argued that "Improvement in economic indices only through increasing oil exports is not feasible because other factors such as liquidity growth also affect indices such as the inflation rate.”

President Raisi and his hardliner supporters often openly or indirectly blame Rouhani for the long-running economic crisis. Raisi on Friday said "four years of inflation above 40% and negative economic growth rate" were the main reasons for the hike in prices.

But few people dare to say publicly that the long-running economic crisis is mainly the result of sanctions imposed by the United States over Iran’s nuclear program and a new deal is imperative for saving the economy.

According to official figures the annual inflation rate rose to over 40% in the previous Iranian calendar year that ended March 20. In the same year the rate of inflation for food was even higher at 51%. Inflation rate has only risen to above 40% twice in four decades in the history of the Islamic Republic.

In his televised speech to mark the Persian New Year on March 20, Supreme Leader Ali Khamenei admitted that Iranians had faced “hardships, high prices and inflation” in the previous year but said expecting the problems to go away quickly was not "realistic".

Pundits say blaming the country's multiple crises on Rouhani and will not resonate with the public, who understands that Raisi had eight months to make an impact on the situation, and he has failed.

In the past few days Iranian media have strongly criticized the government for what they say is inefficiency and ineptitude and highlighted the hike in the prices of food items such as rice, meat, and vegetables.

Domestically grown rice, for instance, has now become unaffordable to most families. According to data published by the Statistics Center of Iran (SCI), the price of various types of domestically grown rice has tripled in one year and risen by around 11% in March alone.

Javan newspaper linked with the Revolutionary Guard carried an editorial on April 14 criticizing Raisi's latest order to lower rising prices.

The president, seeming incapable of controlling consumer inflation, had called on government watchdogs to look "behind the scenes” to find the culprits he called the mafia. Javan pointed out that the "Mafia has infiltrated the body of the government and culprits for rising prices were in fact Raisi's own colleagues in his administration."

The daily further warned that if there is a hidden hand behind the scenes, it means the government is not in control of the country's economy.

The editorial insisted that the administration has a contract with the nation, made promises, accepted responsibility and created some expectations, but it has taken too long, and nothing has been accomplished.

The newspaper also questioned why there are so many mafias in the economy, including the car mafia, the medicine mafia, the potato mafia and so on. It charged that no mafia can exist without infiltrating the body of the government. It concluded, "So, the mafia is the same as the government's managers!"

The IRGC-linked paper then called on Raisi to uproot these mafias based in government buildings in the same way one would uproot the weeds in a garden.

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While Javan criticized Raisi, it is well known that the IRGC is a major player in the economy, having been accused repeatedly of building up a business empire through its political influence and hidden networks.

In another development, former lawmaker Mansoor Haghighatpoor told Khabar Online website that Raisi was not involved in choosing his cabinet ministers and others did it for him. He did not name the "others" but vaguely referred to them as "pressure groups who did their job independent of Raisi's will.”

Like the Javan editorial, the former MP said that Raisi has failed to solve major problems facing the country, and now the people expect him to solve small problems such as potato and tomato shortages.

Haghighatpoor said that one of Raisi’s biggest problems is lack of expertise among his ministers.

He said everyone knew during the June 2021 presidential election that the candidates who were barred from running for president had far better qualifications than those who were approved – including Raisi.

Referring to intractable problems such as rising prices and unemployment, Haghighatpoor said he was sure Raisi will soon start to reshuffle his cabinet.

Politicians on social media were also certain during the weekend that Industry Ministry Reza Fatemi Amin and Labor Minister Hojjat Abdolmaleki will have to leave the Raisi administration soon.

This comes while several members of the parliament, including Jalal Mahmoudzadeh, a lawmaker for Mahabad have said that the Majles presidium has so far prevented lawmakers from tabling the impeachment motion to dismiss quite a few cabinet ministers.

Although over 50 Iranian lawmakers have long called for the impeachment of ministers in Raisi's economic team, Raisi has not commented on the matter.

Another person who is silent about general dissatisfaction with the government is Supreme Leader Ali Khamenei who has maintained public silence.

A few political activists such as reformist commentator Javad Emam have said that changing the ministers will not make the situation any better as everyone else in Raisi's circle of friends and acquaintances also lacks executive experience and a thorough understanding of the country's economic problems.

The petrochemical plant in Miankaleh, northern Iran is planned to be built next to a nature reserve, which galvanized opposition by activists and citizens in the past two weeks. President Ebrahim Raisi came out against the project earlier this week and Iran’s Judiciary issued an order to stop construction until further studies.

However, the governor of Mazandaran province and the Friday Prayer Imam of the region strongly defended the project. The governor is appointed by Raisi and the Imam by Supreme Leader Ali Khamenei. Some hardliners went as far as saying opponents of the project are in essence opponents of the Supreme Leader, thus trying to accuse them of a political crime.

The Speaker of parliament Mohammad Bagher Ghalibaf also has backed the project.

In addition, it was alleged in the media that the owner of the petrochemical plant is a super-borrower from government banks, making the whole project politically more controversial. The individual owners of the land and the project remain hidden from public view, as a host of front companies are officially holders of the permit.

Super-borrowers are influential political insiders who borrow huge sums using their influence, often with no intention to pay back.

The government of former president Hassan Rouhani in an apparently hasty move approved the petrochemical project last year and it obtained the oil ministry’s permission in an unusually fast-tracked manner.

In a tweet Thursday, the embassy wrote that Iran and its islands in the Persian Gulf were “safe for all including Britons and World Cup fans from around the world to enjoy the beauties of this land,” and that “Iranian civilizational and historical identity cannot be distorted by Times.”

In an article Wednesday headlined "No Room in Qatar? Enjoy the World Cup From An Iranian Island," the Times scoffed at Iran’s readiness to host soccer fans and its considering waiving visa requirements for Kish and other islands.

"Alcohol is banned, British nationals are regularly picked up on spurious charges of spying and only two weeks ago female football fans were pepper-sprayed for having the cheek to attend an international match,” the Times wrote. In Qatar itself, strict laws banning alcohol consumption may be waived during the World Cup for foreigners in hotels if not in stadiums.

Despite an expectation of one million visitors in Doha for the tournament in November and December, booking for hotels has not yet begun. Fans from around the world are looking at options including rooms on a cruise ship at $4,000 a week, private accommodation, and luxury camping in the desert.

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On Sunday, Rostam Ghasemi, Iran's transport minister, met with his Qatari counterpart, Jassim bin Saif Al Sulaiti, on Kish Island to discuss Iran’s involvement, following up suggestions made by President Ebrahim Raisi during a visit to Doha in February.

"Kish is the focal location for these arrangements, although other coastal and non-coastal provinces in Hormozgan and Bushehr close to the Persian Gulf can play a supporting role,” Ghasemi said.

Daily flights

Mohammad Mohammadi, head of Iran’s Civil Aviation Organisation, said the current 72 daily Iran-Qatar flights could be boosted to 100 during the World Cup.

Iran’s tourist sector, which includes religious and medical tourism, has struggled in recent years in the face of both United States sanctions and the Covid-19 pandemic. The sector is keen for a boost from the World Cup and is touting the value on offer in Iran given the rial’s decline on foreign exchange markets. Despite Iran’s ban on alcohol and gender-segregated beaches, it was attracting around 5 million tourists annually before US ‘maximum pressure’ sanctions.

The Times, arguing that easing visa requirement for British and American citizens would not remove a tense political climate between Iran and the west, highlighted cases of dual nationals being arrested in Iran, including the daughter of one protesting this week in London outside the Foreign Office. Tehran and London both denied any connection between Iran recently freeing two British-Iranian dual nationals it had held for years on espionage charges and Britain finally paying a four-decades-old debt of £400 million ($530 million). But the connection between the money and hostages was clear to all for a long time and the exchange happened last month simultaneously.

Some Americans may also remember that Kish Island is where Central Intelligence Agency contractor Robert Levinson disappeared 16 years ago. The Trump administration said Iranian intelligence Iranian was responsible for his capture and probable death.