Iranian Lawmakers Dismiss Finance Minister Amid Economic Crisis

Iran’s parliament has dismissed Finance Minister Abdolnaser Hemmati following an impeachment linked to economic challenges, including soaring inflation and currency decline. Despite President Pezeshkian’s defense, lawmakers expressed deep concern over rising prices affecting citizens. The Iranian rial has plummeted against the dollar, and inflation rates have risen significantly since the U.S. re-imposed sanctions after withdrawing from the nuclear deal in 2018, exacerbating economic difficulties.

On Sunday, Iran’s parliament removed Finance Minister Abdolnaser Hemmati following an impeachment vote prompted by escalating inflation and a declining currency. The decision was backed by 182 of the 273 lawmakers present. The Iranian rial’s exchange rate has significantly depreciated in recent months, trading at over 920,000 to the US dollar, a marked increase from less than 600,000 in mid-2024.

President Masoud Pezeshkian defended Hemmati, asserting that Iran is engaged in a broad confrontation with external adversaries and emphasizing that the nation’s economic challenges cannot be attributed to a single individual. Lawmakers expressed their dissatisfaction, with some highlighting the severe impact of rising prices on the populace and the increased difficulty in affording necessities, such as medicine.

Since taking office in July, President Pezeshkian aimed to rejuvenate the economy while navigating Western-imposed sanctions. The currency’s decline has been exacerbated by geopolitical events, including the fall of Syria’s Bashar al-Assad, which affected the regional dynamics. On the eve of the deterioration of the situation in Syria, the dollar had been valued at approximately 717,000 rials on the black market.

In his defense, Minister Hemmati noted that the fluctuating foreign exchange rates reflect inflationary expectations, emphasizing that chronic inflation has been a longstanding issue afflicting the Iranian economy. He pointed out that the key problem is sustained inflation, which has persisted for years amid US-led sanctions that have severely affected economic conditions.

Since the withdrawal of the United States from the 2015 nuclear agreement in 2018, Iran’s economy has continued to suffer from extreme inflation, rampant unemployment, and currency devaluation, impacting daily life for Iranians. Specific figures indicate that inflation rates have soared above 30 percent annually since 2019, reaching about 44 percent in 2023 as noted by the World Bank.

According to Iranian law, the dismissal of the finance minister is effective immediately, with a caretaker assigned until a replacement is appointed. The removal of Minister Hemmati follows a similar situation in April 2023 when the Minister of Industry was also dismissed due to price surges linked to ongoing international sanctions.

The dismissal of Finance Minister Abdolnaser Hemmati by Iran’s parliament underscores the severe economic challenges facing the country, marked by high inflation and currency devaluation. Despite attempts at justification, lawmakers criticized Hemmati for the economic decline overly impacting the Iranian populace. This political decision reflects ongoing frustrations with economic management amid external pressures and internal dissatisfaction. Moving forward, the new caretaker will need to address these pressing issues as Iran navigates its complex economic landscape.

Original Source: www.hindustantimes.com