With the inappropriate and hostile foreign policies practiced by the current Iranian regime towards many countries around the world, including interference in a number of Arab countries’ internal policies, Iran is facing international isolation and sanctions on a regular basis.
These sanctions, which are on the rise, will negatively affect 24 million Iranian citizens. Those citizens are expected to be prohibited receiving from state financial subsidies as the economic situation deteriorates.
According to the state-affiliated Mehr News Agency, the Iranian government is cutting its financial subsidies afforded on a monthly basis to its citizens.
Mehr reported that preliminary statistics indicate that the Iranian government has suspended financial subsidies from 400,000 Iranian citizens. These financial subsidies are provided to citizens as alternative to the state’s subsidies to the food commodities that have witnessed high prices since the start of the US sanctions in May 2018.
Meanwhile, the Iranian-based economic portal Online Economy said that the number of Iranian citizens who will be prohibited from the financial subsidies by March 2020 is expected to reach 24 million out of Iran’s total population of 80 million citizens.
Iranian officials said that the suspension of the state financial subsidies to citizens will be effective next Saturday, October 26th. The amount of this financial subsidy reaches $12 per person, according to Online Economy.
Iran started to provide financial subsidies to citizens during the era of former President Mahmoud Ahmadinejad, who held office between 2005 and 2013. The step was an implementation of a state subsidy plan that afforded each Iranian citizen financial support estimated at $45 according to the old exchange rate, which then became $12 with the new exchange rate in 2018.
President Donald Trump announced last September the US would impose new sanctions against the Iranian banking system, describing them as the harshest sanctions ever made against a state.
Trump said the sanctions had been imposed in response to attacks on oil facilities in Saudi Arabia that the US accused Iran of being responsible for, but Iran denied responsibility.
According to Bloomberg News, Treasury Secretary Steven Mnuchin said at the time that the sanctions would reduce funding for Iran's Revolutionary Guards.
The move is controversial, as sanctions against the central bank may also limit the ability to import humanitarian supplies into the country.
The hostile policies performed by Iran against the Arab countries pushed the Arab Quartet Ministerial Committee to recently express clear condemnation of Iran’s ongoing support for terrorist and subversive acts in Arab countries, including the continued firing of Iranian-made ballistic missiles from Yemeni territory into populated cities, including holy sites, in Saudi Arabia.
The Ministerial Committee, headed by the United Arab of Emirates and including Saudi Arabia, Bahrain, Egypt, and the Secretary General of the Arab League, condemned the actions of the Iranian-backed terrorist Houthi militias, which included drone attacks on two oil pumping stations inside Saudi Arabia, beside the sabotage of commercial vessels in the UAE's territorial waters and in the Sea of Oman.
Moreover, the above acts led to international isolation being imposed on Iran, which in turn led to remarkable deterioration of the economic conditions, badly affecting the daily lives of Iranian citizens.
According to the Statistical Centre of Iran, a quarter of an Iranian family's income is spent on food and beverages due to the increase in prices. The prices of fruits, vegetables, and meat are higher than other commodities, with meat prices having risen 95%.
Reports from the centre indicate the inflation rate in Iran reached 48% due to the volume of continuous rise in commodity prices in light of the continued deterioration of the value of the Iranian currency due to the US sanctions.
However, Iranian economists say that government figures and statistics cannot be trusted because the country's economic reality and citizens' living conditions prove otherwise, and they estimate inflation at 75%.