Under siege: Iranian President Hassan Rouhani. (Credit: United Nations Photo/Flickr)
Under siege: Iranian President Hassan Rouhani. (Credit: United Nations Photo/Flickr)

Over the new year period, the world’s attention was drawn to events in Iran, where a series of protests provoked analysis and outrage in equal measure.

Protests over Iran’s economic problems began in the Shia holy city of Mashhad on 28 December 2017. Shortly afterwards, similar demonstrations broke out all over the country. Economic conditions at the end of 2017 were no worse than they had been a year before, but several factors influenced an outbreak of dissent at this time.

Immediate context and root causes

On 10 December 2017, President Hassan Rouhani had presented a draft budget for the next year of the Solar Hijri calendar, to begin on 21 March 2017. It was destined to be unpopular amongst Iranians.

Among the most unpopular budget items were the removal of subsidies and grants for specific goods; tax rises, including departure taxes on citizens leaving the country (from $21 to $61 dollars for initial departures, with 50% more for second trips, 100% more for subsequent trips); and increases in fuel prices; growing expenses for foreign policy and the armed forces.

Compounding the sense of material pain, a recent avian flu epidemic had killed about 15 million chickens and raised prices for eggs and chicken meat; meanwhile, numerous financial schemes had collapsed, stoking an atmosphere of economic concern.

Looking back further, the government had taken several steps to shield Iran from economic crisis since 2013. The country had suffered from international sanctions due to its nuclear programme. The 2015 Joint Comprehensive Plan of Action agreement led to a step-by-step lifting of sanctions, GDP growth of 4-5% per year, and a lowering of inflation from 40% in 2013 to 8-9% in 2017.

However, the president’s influence is limited by the power of the supreme leader. This affects financial and budgetary matters, especially when they disturb the interests of powerful opposition forces. Rouhani’s plans have thus been restricted by struggles with ultra-conservatives who oppose reforms and support greater foreign policy activity.

Although the Iranian economy has recovered from crisis, it is still beset by problems: poverty; unemployment; corruption scandals; a collapsing pension system; an outdated banking system; and huge expenditure on military and political activity abroad. These have forced unpopular moves to secure economic viability, and it is these which provoked the protests in Mashhad.

Why Mashhad?

Of course, the situation in Mashhad was no worse than that of Isfahan, Shiraz, or Yazd. But Mashhad is an extremely conservative city, the home town of supreme leader Ayatollah Khamenei, and a stronghold for ultra-conservatives led by Ebrahim Raisi, Rouhani’s main election rival in last year’s elections.

Economic reforms also had potential to limit the economic influence of various religious funds and of the Revolutionary Guards, all of whom have serious weight in Mashhad.

This is an important perspective from which to understand the protests against the government. The richest and the most influential Islamic fund in the city, the Astan Quds Razavi Fund, is led by none other than Ebrahim Raisi.

The fight against Rouhani started in 2013, immediately after his presidency began, and intensified after his reelection in 2017. Former President Mahmoud Ahmadinejad accused authorities of a lack of justice, of violating human rights, of corruption, of impoverishing the population, and called for social protests. The goal was to prevent the reforms and support Raisi in establishing his own influence beyond Mashhad.

Rouhani was encroaching on the most ‘holy’ thing of all: his opponents’ money. Mashhad’s Friday Prayer leader, Imam Ahmad Alamolhoda, called the government’s economic management into question and appealed for demonstrations.

However, as the protests spread, their evolution was contrary to these initial goals. Economic slogans quickly changed to political demands, directed against the Islamic regime itself, and against its domestic and foreign policies as a wave of protests swept across Iran.

The protests should be seen as a reflection of Iran’s internal politics: a struggle between liberal reformers on one hand and Islamic hardliners on the other hand. Neither Iran’s youth (60% of the country’s population), nor the middle class, were prominent in driving the initial demonstrations.

What can we learn from the protests?

Because the protests were provoked by internal economic and political forces, any suggestions they were provoked from abroad should be dismissed.

Furthermore, the protests led neither to a popular revolt, nor any repetition of the ‘green movement’ of 2009. Despite their geographic breadth, the number of protestors was relatively insignificant (estimates varied from between 40,000 to 350,000 people across 100 towns over ten days; this among a population of 80 million).

Given that the protesters ultimately had no unified goal, programme, or leadership, and the Rouhani government managed to exercise control relatively quickly, without the use of excessive force, and whilst remaining open to responsive policy adjustments, the significance of the protests should not be overstated.

The primary lesson of the events was that they served as a reminder of the political fragmentation among Iran’s elite.

Having said that however, even if the government is able to provide temporary economic relief in response to budgetary grievances, meeting the demands of younger generations is likely to be difficult in future.

The manner in which the protest evolved showed a society in flux, with potential for  new trajectories within domestic politics featuring ongoing opposition to the Islamic regime.

Iranian society is pregnant with protest and much will depend on whether the country’s leadership can make sufficient policy adjustments both internally and abroad. As time goes on though, splits within governing elites may be a far greater threat to the survival of the Islamic Republic than the possibility of a popular uprising.

These thoughts were shared by Professor Vladimir Sazhin of the Russian Academy of Sciences at the DOC Moscow office on 6 February 2018.