One Hundred Days with the Coalition Government
One Hundred Days with the Coalition Government
The first hundred days of governance outline the forward-looking policies of any government. Franklin Roosevelt, who was the President of the United States during the reigns of Reza Shah and Mohammad Reza Shah, believed that the path to overcoming a crisis should be laid out in the first hundred days.
François Mitterrand, the President of France and a contemporary of the presidencies of Ali Khamenei and Akbar Hashemi Rafsanjani, also believed that the approach to reforms for public welfare should be demonstrated to the people in the first hundred days.
John Major, who was the Prime Minister of the United Kingdom during Akbar Hashemi Rafsanjani’s presidency, also considered the fundamental orientation of any government to be established in the first hundred days of governance.
In this article, we examine the first hundred days of the government of Masoud Pezeshkian and compare it with the government of Ebrahim Raisi to get an outlook on the economy in the coming years. The economic performance of a government is the performance of the ministries and organizations that manage the country’s economy. We will review these.
Ministry of Economy and Finance
The Ministry of Economic Affairs and Finance is responsible for macroeconomic policies, budget planning and execution, overseeing banks, financial institutions, and the capital market, managing tax policies, encouraging domestic and foreign investment, and managing state assets. This responsibility was assigned to Ehsan Khandozi, 42, in Ebrahim Raisi’s government and to Abdolnaser Hemmati, 66, in Masoud Pezeshkian’s government. Both hold doctorates in economics.
Before becoming minister, Ehsan Khandozi worked in institutions close to the Supreme Leader of the Islamic Republic, such as the Economic Council of the Broadcasting Organization and the Economic Commission of the Parliament, while Abdolnaser Hemmati had roles such as the head of the Central Insurance, a member of the Economic Committee of the Supreme National Security Council, and the Central Bank.
Ehsan Khandozi’s economic views were aligned with resistance economy and self-sufficiency as advocated by Ali Khamenei. Therefore, in his first hundred days as minister, he recognized the private sector and the capital market only within the framework of resistance economy and supporting revolutionary institutions. He opposed joining the FATF under sanction conditions and put surplus state assets up for sale to aid the budget.
Abdolnaser Hemmati had a more open economic perspective and supported reducing the role of the government, promoting private sector business, and joining the international community and the FATF. However, during these hundred days, he did not take any action regarding liberalization and joining the FATF, just as he hadn’t during his time as Central Bank head. After three months and a few days, there was no significant difference in the records of the two ministers of Economy and Finance in Raisi and Pezeshkian’s governments concerning combating rent-seeking and leaning towards transparency and market economy.
Ministry of Oil
The Ministry of Oil in the Islamic Republic of Iran manages the extraction, production, distribution, and export of oil, gas, and petroleum products, as well as international investment and cooperation. Javad Owji and Mohsen Paknejad, both born in 1966, were chosen by Ebrahim Raisi and Masoud Pezeshkian, respectively, for the Ministry of Oil. Javad Owji holds a bachelor’s degree in petroleum engineering from the Oil Industry University, and Mohsen Paknejad has a bachelor’s degree in electrical engineering from the University of Tehran and a master’s in industrial engineering from Amirkabir University of Technology.
Before becoming Minister of Oil, Javad Owji was the CEO of the National Iranian Gas Company, Deputy Head of the Atomic Energy Organization, advisor to the Minister of Oil, head of the Fuel Distribution Headquarters, manager of gas field development projects, director general of oil exports, and a main board member of the Central Iran Oil Company. In his first hundred days as Minister of Oil, Javad Owji aimed to increase production and exports and initiate joint projects, especially with neighboring countries. With the ease of sanctions by the U.S. government, he achieved some success in oil exports.
In contrast, Mohsen Paknejad placed more importance on transparency and attracting foreign investment but was unable to implement any of his plans to improve financial processes, contract conditions suitable for attracting foreign investment, reduce domestic oil consumption, and develop renewable energies.
Ministry of Industry, Mine, and Trade
The Ministry of Industry, Mine, and Trade (IMT) in the Islamic Republic is responsible for developing domestic production competitiveness, managing domestic and foreign trade, and providing administrative support for the expansion of infrastructure and small and large businesses. Seyed Reza Fatemi Amin, at 47, and Seyed Mohammad Atabak, at 66, became the Ministers of Industry, Mine, and Trade in the governments of Ebrahim Raisi and Masoud Pezeshkian, respectively. The former holds a doctorate in strategic knowledge management, and the latter a master’s degree in civil engineering from the University of Michigan, USA. The economic views of these two ministers differ.
Fatemi Amin, like many others in Ebrahim Raisi’s government, believed in supportive policies and economic self-sufficiency and opposed joining the FATF, while Atabak, perhaps due to his education in the USA, showed more inclination towards cross-border trade and attracting foreign investment.
Before becoming Minister of IMT, Seyed Reza Fatemi Amin held responsibilities such as Deputy Minister of IMT, head of the Industry and Mining Transformation Headquarters, and management of investments and partnerships of Astan Quds Razavi, while Seyed Mohammad Atabak was the CEO of one of the largest holding companies of the Foundation of the Oppressed, the Kaveh Pars Mineral Industries Holding, which had shares in cement, steel, aluminum, and mineral industries. Additionally, Seyed Mohammad Atabak was also the economic deputy of the Foundation of the Oppressed.
In the first hundred days of their ministries, both ministers had ambitious goals for their dissimilar priorities. Fatemi Amin focused on supporting domestic producers and self-sufficiency, whereas Atabak sought to expand domestic production competitiveness, cross-border trade, and attract foreign investment.
During this three-month period, Seyed Reza Fatemi Amin imposed tariffs on goods with domestic equivalents, such as clothing and home appliances, and worked with the Customs Organization and law enforcement to reduce smuggling. He also compelled the Central Bank to provide low-interest loans to domestic industries, especially small and medium-sized ones, and committed to increasing steel production capacity to 40 million tons by 2026.
In contrast, Seyed Mohammad Atabak in Pezeshkian’s government pursued foreign investment attraction, cross-border cooperation to expand mineral industries, and facilitated imports and exports. He reportedly signed memorandums of understanding worth about $500 million in the steel, aluminum, and copper mining industries with international companies, although he did not name these companies, and sought to attract interest from Iraq, Turkey, and Qatar for joint extraction and processing of mineral resources.
Atabak also reduced customs tariffs for the export of non-ferrous metals, copper, and zinc, and the import of machinery and industrial technologies, and launched an online platform for public awareness of the transparency of government contracts.
Ministry of Cooperatives, Labor, and Social Welfare
The Ministry of Cooperatives, Labor, and Social Welfare in the Islamic Republic is supposed to support the vulnerable, workers, and expand employment in various economic sectors. Hojatollah Abdolmaleki, 40, and Ahmad Meidari, 61, were appointed as ministers of Cooperatives, Labor, and Social Welfare in the governments of Ebrahim Raisi and Masoud Pezeshkian, respectively. Both hold doctorates in economics, the former from Imam Sadiq University, which was established for the integration of Islamic and human sciences, and the latter from the University of Tehran.
Before becoming minister, Hojatollah Abdolmaleki was involved in conservative institutions related to the regime leader, such as the deputy of the Imam Khomeini Relief Committee and a member of its board of trustees, while Ahmad Meidari was the Deputy of Social Welfare in the 11th and 12th governments of Hassan Rouhani, a member of the Islamic Consultative Assembly, and an economic advisor in various institutions. Hojatollah Abdolmaleki believed in Islamic and resistance economy and Ayatollah Khamenei’s self-sufficiency guidance and opposed joining the FATF as he saw it as an obstacle to circumventing sanctions. Ahmad Meidari worked in the field of development economics and policymaking and had a more open view towards the FATF, international trade, and foreign investment.
In the first hundred days of their ministries, the two ministers of Cooperatives, Labor, and Social Welfare adopted different approaches. Hojatollah Abdolmaleki launched initiatives such as the Home Jobs Support System and financial facilities for domestic jobs to support self-sufficiency and resistance economy as envisioned by the leader, but due to financial constraints, he was not successful in implementing his programs.
Ahmad Meidari, with a more open approach, focused on labor market development through cooperation with neighboring countries and creating job opportunities through joint investments, none of which achieved results. He also created an information transparency system to support vulnerable groups and reduce social inequalities with the help of digital platforms.
Organization of Planning and Budget
The President’s economic team in the Islamic Republic also includes the Organization of Planning and Budget, which is not a ministry but is responsible for planning, budgeting, managing development, and evaluating government agencies in implementing projects. Ebrahim Raisi appointed Masoud Mir-Kazemi, born in 1960, and Masoud Pezeshkian appointed Mohammad Baqer Nobakht, born in 1950, as heads of the Organization of Planning and Budget. Mir-Kazemi holds a degree in industrial management from Tarbiat Modares University, and Mohammad Baqer Nobakht has a doctorate in economics from the University of Paisley, Scotland.
Before heading the Organization of Planning and Budget, Masoud Mir-Kazemi was a principalist member of the Islamic Consultative Assembly, CEO of Etka stores belonging to the armed forces, and Minister of Commerce and Minister of Oil in Mahmoud Ahmadinejad’s government, while Mohammad Baqer Nobakht was the Vice President and head of the Organization of Planning and Budget in Hassan Rouhani’s governments. Mir-Kazemi, like his colleagues, was a proponent of resistance economy and reducing dependency on foreign resources, and in his first hundred days as head of the Organization of Planning and Budget, he imposed new taxes to increase government revenue.
Nobakht had a more open approach to foreign investment and international interaction and, as the primary budget planner, proposed plans to eliminate unnecessary expenses, adjust and target energy subsidies, increase efficiency in development projects, and strengthen the supervisory system to reduce the pressure on the public budget. Both ministers, with their differing policies, sought to reduce budget costs. Mir-Kazemi launched monitoring systems, while Nobakht reformed the budget structure.
Statistical Narration
Reviewing the hundred-day economic performance of Masoud Pezeshkian’s government without statistical analysis, although finding hundred-day statistics is not easy, and especially comparing it with the performance of the previous government of Ebrahim Raisi, is incomplete. The table below shows a statistical comparison of the government’s hundred-day performance in terms of inflation, unemployment, misery, and the dollar’s value.
Both governments achieved reductions in inflation, unemployment, and misery rates, but Pezeshkian’s government reduced inflation and misery rates more rapidly. In contrast, the dollar rate increased more in both periods and more during Pezeshkian’s term. It seems that improved economic statistics in the Islamic Republic do not prevent the increase in the dollar’s value or, in other words, the decrease in the rial’s value.
Final Words
In his first hundred days of governance, Ebrahim Raisi adopted resistance to globalization, aligning with the leader’s views, and to this end, dismissed many officials and replaced them with supporters of a state-controlled economy and opponents of joining the FATF.
Masoud Pezeshkian, in his first hundred days, was concerned about war with Israel and awaited the outcome of elections in the United States, and for this reason, did nothing more than timely present the budget bill. His economic team members were older than their counterparts in Raisi’s government and favored trade with the world and opening the economy, but Pezeshkian retained the resistance economy supporters from Raisi’s era. He repeatedly stated that his government’s policy follows the guidance of the leader of the Islamic Republic.
The hundred-day economic performance of Masoud Pezeshkian’s government presents a similar outlook to the government of Hassan Rouhani, suggesting that in the Islamic Republic, even reforms within the government cannot be implemented. Therefore, it is believed that by the end of Pezeshkian’s government, production will remain stagnant, inflation will rise, the banking network will become more indebted, poverty will spread, pension funds will become more depleted, and the dollar will become more expensive, especially since with Donald Trump’s election as President of the United States, the likelihood of lifting sanctions is much lower than before.