Hamid Ahadi

For the first time, President Mahmud Ahmadinejad publicly acknowledged inflation, ‎depreciation of the value of the Rial and price hikes. But even while acknowledging the ‎failure of his administration’s policies, he did not take responsibility for the worsening ‎economic conditions. Still, he made new promises of improving the economy by reducing ‎inflation and raising the value of foreign currencies.‎

Economists pounced on the report, which came on the President’s fourth pilgrimage to ‎Saudi Arabia, saying it was full of contradictions and inconsistencies. Many of the same ‎economists had warned the government about some of the ills that are not being reported ‎in the government account.‎

One of the key issues in the report is the government’s acknowledgment of the ‎relationship between liquidity and inflation, which these very same officials vehemently ‎denied 2 years ago, calling the relationship foreign imported theories.‎

It appears that the necessity to acknowledge the ills and issues permeating the Iranian ‎economy came about by Iran’s Central bank after the survival of the new governor of the ‎Central Bank following intense pressures to resign. While Ahmadinejad presented ‎statistics to support the degree of inflation, liquidity and other indicators – which were ‎miles apart from what he had promised - he stopped short conceding that his ‎administration’s policies were responsible for the trends. The report mentioned that banks ‎were responsible for some of the ills, without making it clear that all banks in Iran ‎operate under the full supervision and control of the government and its agencies. The ‎president took credit for the increase in petro-dollars as income, but said that inflation ‎and unpredicted costs of imported petroleum and refined products were the cause of ‎inflation that was rampant in the Iranian economy. ‎

In previous year, the tone of similar economic reports always blamed the opposition for ‎economic ills such as inflation. This time however it calls inflation to be a basic and ‎fundamental issue.‎

This year’s report also translated economic indicators and indices into more popular ‎language. Contrary to this year’s report, previous accounts denied the role of foreign ‎sources on the national economy, or challenged the view that some of the problems had ‎arisen because of poor government planning. In one instance when Majlis deputies ‎questioned some of the figures mentioned in the report, the President mocked the ‎representatives by inviting them to buy their fruit from the stores in his neighborhood. ‎One of the President’s advisors disclosed later that a few weeks after that incident, each ‎of the presidential advisors brought a paper bag full of fruit and placed it on the cabinet ‎table to disprove the “claims” of the Majlis deputies and the media that criticized the ‎government’s economic report.‎

At that time the President even called those who questioned the statistics in the ‎government’s economic report and presented a grimmer, albeit more realistic picture of ‎the economic indicators, traitors that needed to be investigated. While presenting his ‎report the President did request that the public forgive him for the mistakes and ‎shortcomings that emanated from him. ‎