Iran has been facing a crisis of importing goods at prices higher by 150 per cent from mid-2018 to mid-2019, according to a report by the Statistical Center of Iran (SCI).
With the Iranian currency already losing value after the US withdrawal from the 2015 nuclear pact, Iran’s government has attempted to facilitate trade movement by offering dollars at a much lower rate to certified importers, Radio Farda reported.
The move explains why the prices for imported goods did not rise as much as the dollar rose against the rial. The currency has since recovered some of its losses, but it is still more than threefold lower than two years ago, SCI reported.
The rial’s devaluation reached climax in March 2018, and by September of that year declined fivefold, as the US imposed trade, banking, and oil export sanctions against Iran.
The SCI says the rise in import prices was also due to a tangible rise in the dollar value of goods, but there is actually very low inflation around the globe. The factor that can explain this claim is that US sanctions add other expenses to imports because of banking restrictions on Iran, lack of cheap insurance for shipping, and other similar factors.
Actual year-on-year inflation in Iran is around 50 per cent, with many daily necessities such as meat almost impossible to afford by working-class families.