TEHRAN – Iran’s President Hassan Rouhani said he would not open negotiations with the United States until Washington lifted sanctions it placed on the Islamic republic this time last year.
The sanctions, which the US drew up after it unilaterally abandoned the historic 2015 Iran nuclear deal in 2018, remain in vigor and have stifled the Iranian economy.
Washington’s actions force a sharp decline in the Iranian economy although it has somewhat stabilized since and brought the international deal, signed by China, Russia, France, the United Kingdom and Germany, to a cliff-edge.
“Iran is in favor of dialogue, but if the US really wants to talk to Iran, it must lift all sanctions,” Rouhani said on the anniversary of Donald Trump’s sanctions on Tehran.
In reference to Trump, who he said had used sanctions to target food and medicine in Iran, he said it was “not possible to sit down with a criminal.”
While these sectors are not targeted by the US, the sanctions on Iran’s banking industry makes importing food and medical products more difficult.
The first round of sanctions, which came into effect at midnight on 6 August, were aimed at preventing the Iranian government from purchasing dollars and squeezed the trading of gold and precious metals.
In November, the punitive economic measures were stepped up and focused on the country’s oil and banking sectors, affecting transactions with the Central Bank of Iran.
The International Monetary Fund last year predicted that Iran’s economy would shrink by 3.6 percent in 2019, but in April it raised that estimate to 6 percent.
Inflation has exceeded 30 percent, which has led the Iranian Government to order a consistent rise in wages, and the national currency, the rial, has devalued 60 percent against the dollar, prompting restrictions in its purchase.
A year ago, the rial was sold at around 200,000 per dollar but authorities have managed to stabilize that to around 118,000 on Tuesday and have approved a decision to remove four zeros from the currency.
Famine is a primary concern for regular Iranian citizens as food prices double in the country.
Last year there were visible shortages in some products but nowadays you can find almost anything you need in the local markets, albeit at a higher price.
Shortages and price inflation have also been propelled by corruption, as some merchants took advantage of buying currency at the official price, which is lower than the going rate in the market, but authorities have taken legal measures to prevent this.
Another policy has been to wean the country off oil dependency, which is vital to the Iranian economy.
Iran’s Foreign Minister Mohammad Javad Zarif said the economy was now 30 percent dependent on oil, compared to 50 percent a few years ago and that it was set to be reduced even more in this year.
“The sanctions have influenced Iran’s economy but not as much as we expected,” Mohsen Vedani, a watch seller, told Efe. He said it had mainly affected employees, whose salaries have not risen with inflation.
The policy of “maximum pressure” on Iran from the US, however, has damaged the multilateral 2015 nuclear deal and has raised tensions in the Persian Gulf.
The deal has seen Tehran swap in parts of its nuclear program for a slight alleviation in sanctions.
With the US’ withdrawal, however, Rouhani has also started scaling back his own commitment to the deal by surpassing uranium stockpile limits.
Iran is set to reduce its commitment further unless the remaining parties of the pact find a way to circumnavigate the US sanctions.