Clashes and Protest Over Iran Currency Plunge Hit Tehran
Clashes and Protest Over Iran Currency Plunge Hit Tehran
European Pressphoto Agency
Riot police officers clashed with money changers in Tehran on Wednesday.
By THOMAS ERDBRINK
Published: October 3, 2012
TEHRAN — Clashes and at least one spontaneous protest erupted in Tehran on Wednesday over the plunging value of Iran’s
currency, as black-market money-changers fought with riot police who
were dispatched to shut them down, and hundreds of angry citizens
demonstrated near the capital’s sprawling merchant bazaar, where many
shops had closed for the day. The official media reported an unspecified
number of arrests including two Europeans.
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The clashes were the first instance of a violent intervention over the
money-changing business in Tehran since the currency, the rial, which
had been gradually losing value in recent years, dropped drastically
over the past week, losing 40 percent of its worth against the dollar,
to a record low.
Economists have called the rial’s plunge a stark reflection of the economic pain in Iran caused in part by government mismanagement and the Western sanctions on Iran’s disputed nuclear program.
Witnesses in and around Manoucheri Street, where the black-market money
changers do business, described cat-and-mouse chases between motorized
riot police armed with tear gas and batons, and money changers and their
customers, who were forced to scatter.
The anger over the rial’s plunge spread to Tehran’s grand bazaar, where
many merchants closed their stores and hundreds of shoppers joined in
what appeared to be a spontaneous protest, accusing the government of
failing to protect their currency from collapse.
“They spend billions of dollars to keep Syrian President Bashar al-Assad
in power, but now they say they have no money!,” one garment seller
screamed as he was cheered on by others, witnesses reported. A team from
Iran’s state television was nearly attacked when its reporter turned to
the camera saying that the people behind him had been upset over a
robbery.
Abdullah, a young man selling textiles, loudly complained that it has
become extremely difficult to do business when the value of the rial is
so unpredictable. “The checks our customers give us, bounce, we don’t
know what prices will be tomorrow, how can we earn a living?,” he said.
A video uploaded on YouTube
that witnesses verified as genuine showed hundreds of demonstrators
near the bazaar. But other videos, apparently uploaded by Iran’s
underground and exiled opposition movement to exploit the moment,
appeared to be fake, blending clips from Wednesday with old footage from
the anti-government protests following the disputed 2009 presidential
election.
The Mehr News Agency reported that several people were arrested at the
bazaar, including two Europeans disguised as tourists were “collecting
intelligence.” They were not further identified.
The violence and protests came a day after President Mahmoud Ahmadinejad,
in a nationally televised news conference, asked Iranian citizens not
to sell their rials for other currencies, suggesting the problem had
been caused in part by speculators.
Mr. Ahmadinejad also warned that a “band of 22 people” with the power to
manipulate exchange rates could face arrest, and he accused the United
States and unspecified “domestic allies” of waging a psychological war
on the country.
The secretary-general of the Tehran Bazaar and Trade Union, a powerful
official close to the government, accused unspecified outside
instigators of pressuring bazaar merchants to close their shops. The
official, Ahmad Karimi Esfahani, was quoted by the Iranian Labor News
Agency as saying that most merchants had wanted to remain open for
business. “Those now present are trying to show the bazaar as closed,”
he was quoted as saying. “They are guided by foreigners.”
Other bazaar traders hinted that the closure of the bazaar was organized
by powerful opponents of Mr. Ahmadinejad, who were trying to make him
look weak by closing down Tehran’s most popular shopping center.
Members of Parliament and Shiite Muslim clerics have been calling for an
end to the black-market currency trade, accusing the money changers of
driving down the rial’s value. Others have called upon the government to
buy up rials and sell dollars and other foreign currencies warehoused
in the central bank’s reserves to restore stability to the national
currency.
In the last weeks, traders and regular citizens had gathered by the
hundreds on Manoucheri Street in Tehran to buy foreign currencies in
anticipation of further weakening in the rial.
During the past months some Iranian leaders and clerics have warned
against social unrest over the worsening economic malaise in the
country. The fall in the currency’s value has presented Iran with
enormous economic risks, including the possibility of starting a severe
bout of inflation, which is already high. A rising sense of economic
crisis in Iran could also pose new political challenges for the
country’s leaders.
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