Raisi’s Super Promises Were Just Hot Air
Raisi’s Super Promises Were Just Hot Air. According to Iran Gate, during the 2021 presidential elections, Ebrahim Raisi made numerous grand promises, mostly in the area of economic management. However, more than 14 months into the start of the thirteenth government, it can be said with certainty that none of these promises have been fulfilled, and they all remain unresolved.
Among the most important promises Raisi made to Iranian citizens were the construction of four million housing units over four years, ending government borrowing from the central bank to control Iran’s inflation, and also boosting the stock market. Although the command-based management approach of the economy in the thirteenth government has made the list of promises longer than the early days of the government, Iran Gate has examined three of his most important slogans and their outcomes in this report.
Raisi’s Dream Selling to Renters and First-Time Homebuyers
Perhaps the most important promise Raisi made during the 2021 election was the construction of four million housing units over four years. However, now more than a year into the start of the thirteenth cabinet, it can be said with certainty that not even one housing unit has been delivered to applicants. According to statistics published in Iran’s official media, the groundwork for about 500,000 housing units has been laid.
But by the last days of October 2022, not a single unit has reached the rough construction stage, let alone been handed over to applicants. This situation was predictable by economists from last year, but Raisi’s close associates convinced him that selling the dream of homeownership to young people and renters could garner public support for his candidacy.
Although the election results showed that Raisi was stagnant and took over the key to the presidential office from Hassan Rouhani with the lowest possible vote, he has repeatedly boasted about his government’s truthfulness and now must be accountable to all Iranian citizens. First, he must explain how he promised the construction of four million housing units and based on which expert plan he made this claim. During the election campaign, Raisi repeatedly emphasized that he had a plan according to which the construction of four million housing units would be entirely possible in the thirteenth government.
However, with less than three years left in the government’s term, not a single apartment unit has been delivered to applicants. The very low public interest in Raisi’s National Housing Movement plan also showed that citizens are well aware of the baselessness of the thirteenth government’s promises.
The controversies surrounding the Ministry of Roads and Urban Development, which arose due to the dubious activities of Rostam Ghasemi and his advisors and deputies, are another deterrent factor in implementing this plan. Although economists believe that even with competent and skilled managers, the construction of four million housing units in the remaining three years of Raisi’s government is impossible, let alone a ministry led by someone who still does not know whether he is the minister or the road and urban development.
The Government’s Reins in the Hands of Inflation
Last year, Raisi repeatedly claimed that the 2022 budget was designed in such a way that the government would not need to borrow from the central bank. Borrowing, which results in nothing but an increase in liquidity and monetary base, ultimately leads to increased inflation. Ebrahim Raisi has consistently promised over the past 14 months to control runaway inflation. Of course, with the strange and bizarre statistics of the central bank, the government managed to control two to three percent of inflation on paper.
However, reports from the Statistics Center show that the thirteenth government has succeeded in breaking the record for the highest point-to-point inflation rate in Iran’s history. The misguided policy that the government implemented under the pretext of preventing smuggling and under the guise of eliminating preferential currency, due to its non-expert nature, caused the middle and lower classes of society to buckle under the sudden inflation spike.
The announced inflation by the Statistics Center remains at a peak of 40 percent. If we consider the Shaparak transaction statistics as a criterion for assessing purchasing power over the past year, it becomes clear that by the end of this summer, the purchasing power of various groups experienced a negative growth of 25 percent. On the other hand, there are signs of indirect and severe government borrowing from the central bank, borrowing that has led to the issuance of high-powered money, and experts predict a much darker inflation outlook for the second half of the year than what is currently happening.
Liquidity on the Brink of 6 Quadrillion Tomans
Another indicator that contradicts the government’s claim of not borrowing from the central bank is the more than one quadrillion toman jump in the country’s liquidity. Last year, when Ebrahim Raisi won the election, liquidity was around 4 quadrillion tomans, but now, having surpassed the unbelievable threshold of 5 quadrillion tomans, it has caused indescribable concern among experts.
Economists believe that the more than 35 percent growth in liquidity is worrying, but what has frightened the expert community is the outlook for liquidity growth. An outlook that, given the speed of liquidity growth over the past year, indicates the breaking of the 6 quadrillion toman liquidity record in less than nine months.
Thank God Raisi Became President
In the 2017 presidential election, four years after suffering a heavy defeat from Hassan Rouhani in 2013, Raisi said in an interview, ‘Thank God we didn’t become president so that the dollar wouldn’t reach 5,000 tomans.’ Now, five years have passed since that day, and about a year and a half ago, Ebrahim Raisi won a controversial election in which he saw no competitor.
On the day he took charge of the government, the dollar was around 24,000 tomans, but over the past year and a half, not only has it broken the historical record of 33,000 tomans, but it currently hovers in the 32,000 toman range despite the government’s relentless interventions in the foreign exchange market mechanism. This currency price jump means an increase of more than 35 percent in the dollar rate in just one year.
This is in a situation where no new fundamental change that would harm Iran’s economy has occurred in international relations. The only unpleasant event regarding sanctions for the country is the protracted nature of the negotiations to revive the JCPOA, which is also the handiwork of a negotiating team that has been repeatedly praised by Raisi.
Stock Market on the Brink of a Major Collapse
From the day the thirteenth government began its work, Raisi and the members of the government’s economic team have repeatedly promised to support the capital market. However, a look at the stock market’s trend over the past year indicates the command-based management model of the government in the economic field. On the one hand, the government’s immature policies in international relations have created new risks for the market. On the other hand, the issue of new human rights sanctions is a new threat to the Tehran stock market, which has resulted from the government’s unwise policies regarding hijab and chastity.
There are also whispers of the formation of circles among shareholders who are calling for a widespread protest movement at the national level. A movement that, due to the incompetence of the stock exchange organization’s managers and the disastrous performance of the government’s economic team, is taking shape and could put a line through all of Ebrahim Raisi’s government’s economic promises and slogans.
Multiple analyses and reports have been prepared and organized by Iran Gate regarding the stock market and Iran’s economic situation. For convenience, we have listed a few of them that are related to this topic below.
- How the Stock Market Shrunk Under Raisi’s Government
- Raisi’s Stock Market Promises: Slogans That Were Expensive for Nothing
- Improvement of Governance: A Rhetorical Game by Principlists