Iran economy hits rock bottom amid protests

DW (English)

Hyperinflation has destroyed the cpountry's currency rial and Iranians can no longer afford basic goods and services. Protests in the streets have escalated and thousands are feared dead.

Transcript

00:00The protests in Iran continue.

00:04The main trigger for the days-long unrest is the country's dramatic economic situation.

00:10Due to high inflation, people can't afford basic goods and services any longer,

00:15and they're upset with the authorities they're accusing of ruining the lives of many Iranians.

00:21They have been trying to lower inflation rates.

00:25Instead, we saw this past few months, inflation increased maybe by 50%.

00:32So the inflation in November ran at an annual rate of 72%.

00:40So I don't know if there is the economic means to stabilize prices, stabilize the exchange rate.

00:51Iranians are unable to export oil, but they're also unable to export anything else.

00:58Oil and gas exports are Iran's most important source of income.

01:03However, due to U.S. sanctions, revenues in this and other sectors are declining dramatically.

01:09At the same time, the currency has become virtually worthless overnight.

01:13While one dollar equaled around 43,000 riyals in December,

01:18Iranians now have to spend almost one million riyals for a single dollar.

01:23That's an increase of more than 2,200%.

01:26Following this massive currency collapse, the head of the Iranian central bank resigned at the end of December.

01:34But the economy remains in dire straits.

01:36The protests have also given many exiled Iranians hope for change and improvement.

01:41But no one knows how it will end.

01:44I was in Iran a few months ago, and I just couldn't believe how my middle-class family could not even simply afford a basic need.

01:54And I come from a middle-class background, let alone to the poor people.

01:59There is no future, there is no job, there is no water, there is no electricity.

02:02Meanwhile, U.S. President Trump has reacted to the high death toll and expressed support for the protests,

02:09announcing immediate additional tariffs on all countries, still doing business with Iran.

02:15This primarily affects China, a major buyer of Iranian oil.

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