Iranian Economy ‘Worse Than Thought’ Says Rouhani Advisor

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An advisor to President-elect Hassan Rouhani in charge of the transition from President Mahmoud Ahmadinejad’s administration to Rouhani’s said that “The economic situation of the country is worse than previously thought.” Akbar Torkan, who was minister of defense under Rafsanjani and deputy minister of oil under Ahmadinejad’s first term, said that one of the primary challenges of the incoming administration will be to “secure basic goods.”

One of Rouhani’s mandates as president will be to create stability in the Iranian economy, which has appeared unmanageable in the last few years to due economic sanctions from the West and government mismanagement. This is no small task, and other Rouhani advisors have begun to issue warnings against expecting a quick economic rebound.

In an interview with Aseman Weekly, Torkan said that some in Ahmadinejad’s administration are now attempting to absolve themselves of culpability for the dire economic situation of the country. Torkan continued, “This is surprising to us. We all saw that they were partners in Ahmadinejad’s policies. Okay, stand like a man and say ‘we made a mistake.’ … You mean this economic situation that is so deplorable in this country, only Ahmadinejad is at fault? This is not acceptable.”

On the allegations that some of Ahmadinejad’s ministers have skirted the law, Torkan said, “Each minister will be responsible in front of parliament. No minister can ignore the law, even with the president’s orders. Now everyone says that they had no role in this situation. Then who had a role in it? Could it be said that in the administration of a country so large, all the problems come from one person? Fairness means that all those who had a role in today’s economic turmoil have to take responsibility for their actions.”

Torkan also said, “The budget for the following year is unrealistic — neither the earnings nor the conditions attached to it.” He continued, “In this budget, it is planned that family subsidies [cash payments] will be paid as has been done previously. For this, energy prices have to increase by 38%. Until now, this decision has not been implemented. Not implementing this means that there will be no money to spend on the subsidies.”

When asked how the administration was able to pay for the family subsidies so far, Torkan said, “Up until now, they have taken it from other places and given it to families.” He continued, “From illegal places, they will secure 50% of the funds, and the other 50% will be taken from another place. And they didn’t reform the prices for it to be a source for the monthly cash subsidies.”

Torkan continued, “Rouhani’s first challenge immediately when he takes office will be [the subsidies]. In order to pay for the family subsidies, he has to increase [energy] prices. In your opinion, is this good? Meaning immediately as someone comes into office they do this. …This is a big challenge. The prices should have gone up months ago for this administration to pay for the subsidies, but right now the administration is paying the subsidies via other sources that the law did not forecast. If Rouhani does not want to violate the law, based on the laws of parliament, he must increase energy prices.”

The next challenge, according to Torkan, “is that securing basic goods for the country has not been done according to what has been planned.” Perhaps sensing the alarm he has been causing, he added, “I do not want to worry anyone. “God willing, with the effort that is underway, this will be compensated for.”