What Goes On Behind the Scenes at the Central Bank: Part Two

What Goes On Behind the Scenes at the Central Bank: Part Two

What Goes On Behind the Scenes at the Central Bank: In the second part of the Central Bank’s behind-the-scenes dossier, the focus is on interventions by some of the managers of this institution that violate the independence of the Central Bank. This institution, which should practically be separate from the government, has always enjoyed a degree of relative independence in the past.

In periods like the presidencies of Noorbakhsh, Sheibani, and Hemmati, this independence was more tangible. However, during Ali Salehabadi’s presidency, this independence is not only unfelt but, on the contrary, the Central Bank has become one of the government’s subsidiaries.

A subsidiary that considers justifying the policies of the thirteenth government as its main duty and tries to pave the way for implementing the cabinet’s unreasonable and unprofessional policies. This report addresses the role of some figures present in the Central Bank in undermining the institution’s fragile independence from the executive branch.

Justification After Justification

In the 14 months since Ali Salehabadi has been at the helm of the Central Bank, this institution has consistently moved to justify the government’s economic policies. Even at times, just hours after Ebrahim Raisi’s interviews and the presentation of dubious statistics, the head of the Central Bank has been seen appearing before the cameras, providing strange and surprising reports on the living conditions of the people to endorse the thirteenth government’s president.

However, according to unofficial news obtained by Iran Gate, the role of some figures in adopting such stances is much more prominent than other current managers of this institution. Of course, it should not be forgotten that Ali Salehabadi’s approach is also precisely aligned with the policy of justifying the government’s actions, but the public doesn’t see behind the podiums and naturally isn’t aware of the behind-the-scenes events.

As mentioned in the first part of this dossier, Saeed Mostashar, the Deputy of Administrative Affairs of the Central Bank, is one of the most important behind-the-scenes figures in this institution. His traces are clearly seen in the government’s interventions in the managerial affairs of this policymaking institution. Of course, other individuals also play significant roles in this section, but according to the information mentioned in the previous part and the existing evidence, Mostashar’s hand is particularly open in this matter.

Response After Response

Among the entities that can establish the Central Bank’s independence is the public relations department of this institution. Naturally, the manager of this section also plays a very important role in this regard, but the performance of the Central Bank over the past 14 months shows no sign of positions independent of what the government prefers.

However, this deficiency is not only related to the government’s view of the Central Bank, but the thirteenth government’s information headquarters has generally turned all related institutions into official and unofficial platforms of Ebrahim Raisi’s government. Platforms that are constantly issuing severe and vehement responses against the slightest criticism published in the country’s official media.

But as mentioned, this should not have happened to the Central Bank, as efforts have been made to at least outwardly portray the Central Bank as an independent institution. However, during Ali Salehabadi’s management, customary formalities have been set aside, and the Central Bank practically considers itself a subsidiary of the executive branch.

The procedure is such that the government’s information headquarters, which has now become a place for preparing and formulating the government’s media strategy, is constantly reviewing the criticisms published in domestic media.

This media monitoring not only does not lead to research to address the shortcomings but ultimately results in the creation of a list of more noticeable criticisms, for which tasks are defined for the relevant institutions depending on the subject. In fact, the government’s information headquarters forces ministries, organizations, departments, and recently the Central Bank to issue responses to criticisms.

As previously mentioned, even if such an approach could be implemented and justified, it should have reached the Central Bank at the last stage. However, this policymaking institution, independent of the government, has taken the lead and from the very early days of the thirteenth cabinet’s formation, has adopted a justificatory approach towards the government’s performance.

In this regard, the role of Saeed Mostashar is very clear. It is said that he consolidates the reports from the government’s information headquarters and refers them to the Central Bank’s public relations for issuing responses. Meanwhile, the Central Bank is a sovereign and non-partisan institution and should operate independently of the three branches of government. However, the response-writing approach that Salehabadi and his team at the Central Bank have adopted has kept this institution away from its main mission.

A mission that is to maintain the value of the rial, with its tools being the control of inflation through monetary and banking levers, which are used in all healthy economies around the world. However, Ali Salehabadi has currently downgraded the Central Bank’s status from a policymaking and supervisory authority to an institution that is supposed to make the government’s economic team’s record appear spotless.