Iran Economy is Reeling Under Sanctions, Khamenei Chief Admits
Iran’s economy is struggling as sanctions bite hard, the Supreme Leader’s chief of staff has said in a rare admission by the regime.
Iran’s economy is struggling as sanctions bite hard, the Supreme Leader’s chief of staff has said in a rare admission by the regime.
In unusually frank remarks, Gholamhossein Mohammadi Golpayegani said: "We are facing difficulties due to sanctions; however, the government will find a way to overcome these problems."
His comments to Iranian media on Friday come amid grim data on the state of the economy. The Central Bank of Iran (CBI) last month reported a 52.3% inflation rate for 2023, and there are widespread shortages including of gasoline despite the country’s major oil resources.
The sanctions are being enforced against Iran because of its nuclear weapons programme and support for terror groups, but Supreme Leader Ali Khamenei and his loyalists have been reluctant to acknowledge the strain caused to the economy. Instead, they claim the sanctions are opportunities for growth and development and could foster national unity.
"Weapon developments is an example of turning sanctions into opportunities," Khamenei stated during a speech in April. "Sanctions cannot impact Iranians because they need no external help."
Inflationary pressures have been exacerbated by the plummeting value of the Iranian currency. Over the decades, devaluations of the rial have caused millions of Iranians to fall into poverty.
The recent foreign policy decisions of the Islamic Republic have made things substantially more difficult for the economy. The foreign exchange market in Tehran witnessed an unprecedented surge during the first two weeks of April, with the dollar briefly reaching 700,000 rials amid worsening tensions between Iran and Israel. In 1978, the rial was valued at 70 rials per dollar.
Inflation has eroded the middle class, with tens of millions of people now living on roughly $200 a month, far below what is required to maintain a middle-class lifestyle.
The university has also liaised with IRGC-connected diplomats for student exchange programs, only to see two of its graduate students detained or kidnapped by the IRGC and its allied armed groups in Iraq.
With its second student still missing, Princeton’s experience is a “cautionary tale of how American institutions can be ensnared in the internal politics of Tehran and Washington and become pawns in those battles,” the report’s author, Jay Solomon, writes. “[The] Congress is now formally probing the school’s ties to Iranian regime officials.”
The report, published Thursday under the headline “How Princeton got burned by its outreach to Iran,” is based on original investigation and makes use of a cache of Iranian foreign ministry emails that were obtained by Iran International and used in two scoops about an Iranian influence network in the US.
Some familiar names from previous reports appear in the new one: Mostafa Zahrani, a senior Iranian foreign ministry diplomat with strong ties to IRGC, and Ariane Tabatabaei, currently at Pentagon, whose close and extensive ties with the regime have raised many eyebrows, and led to calls for revocation of her security clearance –as has happened with her mentor, Robert Malley, who until a year ago was Joe Biden’s Iran envoy.
Once more, Tabatabaei seems to have been at the heart of Iran’s soft war: this time initiating the ‘outreach’.
“I wanted to introduce you to a friend who is in Princeton, and you will see him in Vienna in three weeks,” Tabatabai wrote in a 2014 email, attempting to connect Kevan Harris, the then associate director of the University's Iran Centre to Mostafa Zahrani, an Iranian diplomat with IRGC ties. “[Kevan Harris] is interested in sharing with you a plan to send Iranian students to Princeton and to send American students to Iran.”
The emails obtained by Iran International show that Harris then “arranged to see Zahrani in Austria two weeks later on the sidelines of the nuclear negotiations that were taking place between Iran, the US, and other global powers there.” Early 2015, Princeton picked its first candidate for its nascent Iran program: the Chinese-American student Wang Xiyue.
“Wang was hesitant about going to Tehran,” according to Semafor. “He also raised with Princeton his concerns about security.” Harris told him it would be fine. “It’s a good time to go [to Iran] — looks like they are in a good mood over there.” Six months later, Wang was arrested. He spent more than three years in Tehran’s notorious Evin prison, including in solitary confinement. He was released in a prisoner swap in 2019.
But Princeton seems to have ignored the lessons of Wang’s plight. In March 2023, a second Princeton graduate student, Elizabeth Tsurkov, was abducted by an Iranian-affiliated militia from a cafe in Baghdad. She hasn’t been seen since last November. “Both the US and Israeli governments blame Iranian-backed militia Kataib Hezbollah (KH) for the abduction.”
Elizabeth’s sister, Emma Tsurkov, has been vocal against Princeton’s response –which denied it approved Elizabeth’s travel to Iraq, implying that their student had “gone rogue.” It took the University more than six months to publicly take responsibility “for Elizabeth’s research and travel to Iraq.” Shortly after, in November 2023, KH released a video in which Elizabeth claimed, “she was both an operative for the CIA and Mossad.”
The report in Semafor also addresses the (very much ongoing) controversy surrounding Hossein Mousavian, a top regime diplomat and former nuclear negotiator, who has been at Princeton since 2009. “He fled Tehran that year after being charged with espionage”, but once in the safety of the US, he continued to promote the regime’s talking points and its nuclear positions. The emails obtained by Iran International and reviewed by Semafor shows that Mousavian would consult Zahrani and then-Foreign Minister Javad Zarif to ensure his pieces were on message.
There was very little doubt at this point that Princeton enjoyed “strong ties to the upper echelons of the Islamic Republic’s leadership,” Semafor quotes Wang. Even one of Wang’s advisers at Princeton’s Iran center, Mona Rahmani, had close ties to the regime in Tehran. “Her father ran Tehran’s interest section in Washington.” Wang says Rahmani “declined” to help him when he was thrown into jail in Tehran. Mousavian suggested it would be “counterproductive” to appeal to his contacts. And Princeton advised his wife to keep quiet and “not publicly criticize the Iranian government.”
“Simply put, after encouraging and convincing Mr. Wang to go to Iran, Princeton chose to put their reputation and political interest ahead of Mr. Wang’s personal safety,” reads the lawsuit that Wang filed against his former school in 2021. Princeton has always denied the charge of “negligence”. Last September, the two parties settled out of court with the school giving Wang an undisclosed amount.
Of all those named in the Semafor story, the only character still in Princeton –and almost entirely unaffected by all this– is Mousavian. The school still supports him and defends the decision to hire him in 2009, citing his role “in helping to promote the 2015 Iran nuclear deal, and his efforts to reduce tensions between Washington and Tehran that some Western officials worry could expand into an all-out war,” according to Semafor.
But some in the Congress have raised concerns about his continued presence in the US, with the House Committee on Education and the Workforce formally probing his employment: “Mousavian’s position...raises significant concerns about the influence of foreign hostile regimes on American institutions,” the committee wrote to Princeton President Christopher Eisgruber last November.
This has partly been a result of a grassroot campaign by Iranian-American activists who are pressuring Princeton to sever ties with Mousavian. Their campaign got a boost in March when the National Association of Scholars (NAAS) joined their chorus to get Mousavian dismissed. “His position threatens US national security and cedes academia’s integrity to a hostile regime linked to terrorism and human rights abuses,” the NAAS statement read.
Princeton has also hosted Robert Malley, the Biden administration’s suspended special Iran envoy, as a guest lecturer for the 2023 fall semester–months after his security clearance was revoked. Malley is currently being investigated by the FBI for the possible mishandling of classified information.
