Inequality the Key to Poverty in Iran

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TEHRAN — Due to the U.S. viewing Iran as the number one state sponsor of terrorism, it is not often that any sympathy is reserved for the largest Shia nation in the world. However, casting political history aside for a moment, the increase of poverty in Iran should not be ignored.

It was estimated in 2015 that 70 percent of Iran’s population was living below the poverty line. Although Iran is seldom featured on lists of countries across the globe most struck by poverty, such a statistic places its poverty rate amongst the very highest in the world.

To put things in a clearer perspective, a family of four in Iran requires around $400 per month to survive, yet a worrying proportion of Iranian families are receiving the national minimum monthly salaries of less than $200. For comparison, Chinese workers on minimum wage are earning nearly one-and-a-half times as much as Iranians.

In 2015, the Iranian Minister of Labor and Social Welfare estimated that 12 million Iranians suffer from food poverty. While official up-to-date statistics are difficult to come by, the trend of a rise of poverty in Iran can all but guarantee the number is significantly larger today.

The reason for poverty in Iran going relatively unrevealed and undiscussed may be due to it being the second-largest economy in the Middle East. Its remarkable abundance of oil and gas reserves provides Iran with a GDP placing it above a whole host of European countries and into the top 30 nations in the world. This supposed economic stability gives the impression that Iran is a place moderately free from economic hardship.

The reason for this apparent contrast between soaring levels of poverty in Iran and simultaneous economic prosperity is the degree to which wealth is accumulated at the top.

The gap between Iran’s richest and poorest is doing nothing but widen and this reality is driven by nepotism. Families with connections to high-ranking elites, as well as the high-ranking elites themselves, enjoy special relationships with banks and the authorities, landing them in the top 5 percent who possess a hugely disproportionate chunk of the nation’s wealth. The supreme leader, Ayatollah Ali Khamenei, is estimated to be worth a staggering $95 billion.

While the country’s richest enjoy trips to Paris and London every weekend, the majority of the country is fighting just to get by. The current president, Hassan Rouhani, has set tackling poverty and the redistribution of wealth as a focal point of his tenure and labeled unemployment and poverty the worst evil once taking office.

While Rouhani cites the elimination of poverty as a goal that can only be achieved in the long-term, it seems his priorities lie with curbing general economic decline. With this being said, poverty continues to rise and unemployment has been forecast to double, while inadequate increases to the minimum wage are blamed on a dubious and untrustworthy inflation rate by Rouhani’s government.

Cornell Holland

Photo: Flickr

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