- Iran labor force for 10 years and older population in this year has been 23,875,023 with a participation rate of %38.3 (men's participation rate at %62.1 and women's participation rate at 14.1%). (Ref. Table 1 of the report). The participation rate has declined %0.6 since its previous year where it stood at %38.9.
- In 1388 (March 2009 to March 2010) SCI reported that 21,000,079 were employed in agriculture, service and industrial sectors, in the following year this number is 20,656,621. This means 343,458 jobs lost on a year to year basis.
- Looking at seasonal data however we see in the winter of 2010 the number of unemployed rises to 3,420,836 with labor force falling to 23,367,266. This means a total employment of 19,946,430. This means a loss of 1,053,646 jobs. In this I believe we have to take into account that winter does reduce activities in agriculture and construction. This could be the effect of the season. However still 343,458 is a rather large number.
Saturday, January 14, 2012
Has Iran's Economy Lost One Million Jobs?
Ebrahim Alizadeh in a report for Jahan Sana'at daily in Tehran has written that in the past year one million job has been lost in Iran. His report prompted me to check the original report from Statistical Center of Iran (SCI). The latest report which covers Iranian calendar year of 1389, from March 2010 to March 2011, includes a summary statistics for Iran:
Friday, January 13, 2012
Dollar & Rial in Tehran
There are several reasons for the recent events in currency market in Iran.
First USD has been and is undervalued in Tehran. Iranian governments since Pahlavi always make the value of Rial a matter of political prestige. According to politicians a strong Rial meant and means a strong economy. However this is an illusion, since this claim is only justifiable if Iran had a strong export base. Iran exports oil, which many consider capital. Thus governments, past and present, have maintained a strong Rial using oil revenues.
Second market has realized this a long time ago, Iranian consumers and businesses have witnessed the collapse of Rial in the past. In a way it was expecting USD to gain value. Imposing sanctions on Central Bank of Iran served only as a trigger to ignite a shock. It signaled the market that CBI might not be providing market with paper money, hard cash, in future. USD was already on the rise, from 11650 Rials at the beginning of summer to 13000 Rials at the beginning of summer. This steady rise was accelerated by the news of sanctions.
Still CBI and government keep a brave face, fighting the tide. The question is if Iranian manufacturers would benefit from these events. They are already squeezed harshly by losing their subsidies. In the past years the undervalued USD and strong Rial encouraged massive imports. Many have already lost their consumers and local markets to Chinese products. The rising dollar for them means increasing cost of parts and necessary material. Acquiring both has already been made impossible by sanctions.
Taking into account the increased cost of transactions and the government increasing fiscal responsibilities, particularly paying out the cash subsidy, one would expect to see a further rise in USD in Iran's currency exchange. It seems many on the ground has already adopted this.
First USD has been and is undervalued in Tehran. Iranian governments since Pahlavi always make the value of Rial a matter of political prestige. According to politicians a strong Rial meant and means a strong economy. However this is an illusion, since this claim is only justifiable if Iran had a strong export base. Iran exports oil, which many consider capital. Thus governments, past and present, have maintained a strong Rial using oil revenues.
Second market has realized this a long time ago, Iranian consumers and businesses have witnessed the collapse of Rial in the past. In a way it was expecting USD to gain value. Imposing sanctions on Central Bank of Iran served only as a trigger to ignite a shock. It signaled the market that CBI might not be providing market with paper money, hard cash, in future. USD was already on the rise, from 11650 Rials at the beginning of summer to 13000 Rials at the beginning of summer. This steady rise was accelerated by the news of sanctions.
Still CBI and government keep a brave face, fighting the tide. The question is if Iranian manufacturers would benefit from these events. They are already squeezed harshly by losing their subsidies. In the past years the undervalued USD and strong Rial encouraged massive imports. Many have already lost their consumers and local markets to Chinese products. The rising dollar for them means increasing cost of parts and necessary material. Acquiring both has already been made impossible by sanctions.
Taking into account the increased cost of transactions and the government increasing fiscal responsibilities, particularly paying out the cash subsidy, one would expect to see a further rise in USD in Iran's currency exchange. It seems many on the ground has already adopted this.
Friday, January 06, 2012
Back in Atlanta
After almost four weeks in Tehran I am back in Atlanta. Rial value is depleting at the best, which was expected. So many things to say, one does not know where to start!
Thursday, November 17, 2011
Gadaffi, Mussolini and the future of Libya
A piece I wrote about Libya was run by Opendemocracy.net . There is indeed a haunting resemblance between the footage of Gadaffi’s capture and that of Mussolini’s last scene in Milan. I could not help noticing it. Whence this piece was written. I hope you like it.
Gadaffi's demise is similar to the ending of another vivid figure in Libyan history: Benito Mussolini, who in the early 20th century waged a full scale war against Libya's popular resistance against Italian occupation. Although Italian forces invaded Libya in 1911, it was Mussolini who ultimately crushed Libyan resistance, using poison gas, tanks, and whatever the Italian Army had to offer in the late 1920s. According to some historians, more than 80,000 people in the eastern coastal province of Cyrenaica died in combat or of starvation and disease.....Read More.
Saturday, October 01, 2011
A Historical Embezzlement
Iranian media is abuzz with the news of recent embezzlement. Surprisingly except for some irregularities it does not seem any crime has taken place. Iranian banks do not have a market based approach to the concept of risk in financing, instead they rely on bureaucratic procedures. I wrote a piece on this which appeared in Donya ye Eghtesad in Tehran on Saturday. It advocates adopting a risk score and a market approach to banking system. A veteran journalist criticized me for not paying attention to the decline in national currency, frankly I think even when Rial is losing value a market approach will work better and more efficiently than government's bureaucratic procedures. The procedures provide many opportunities to manipulate the system and to abuse the funds, still it seems many prefer the bureaucratic approach to a market approach.
That is being said, i do not think this is the end of affair. Would this be another "Queen's Necklace"?
Friday, September 16, 2011
10th Anniversary of Iranian Blogging
Happy Birthday!
The blog sphere in Iran is officially 10 years old. It started with a wave that crashed through social perceptions like a tsunami. Sometimes I think it was like us hearing our own voices. It is always startling when one records his or her own voice for the very first time and then listens to it. It is like a new discovery, sounds familiar, but unbelievable. Blogging in Iran was like that: familiar and yet unbelievable.
People discovered they are similar in ordinary and in extraordinary ways, it was like discovering others and self discovery. And we believed everybody else also sees the emperor naked. At the beginning it was exciting: people talked about their habits, their parties, some even spoke of their affairs and love life (not in a very elegant way). Still it was revolutionary.
Tsunami brought to shore many individuals who would have remained obscure, it is interesting to notice that many ended up working for professional media organizations. Some of the earliest bloggers were imprisoned and some like Hoder still are imprisoned. Some continued their studies and some used blogging to promote their businesses and ideas. Blogging was accepted as a media, easy to use and easy to follow. Revolution over, evolution has begun.
On the 10th anniversary many talked of pessimism, of lack of enthusiasm and fresh ideas and of passivity. I disagree. Certainly the excitement of the early days is gone and that is only natural. The maturity is setting in. Blogging has a significant role in Iran now and it is an established part of media. It will go on and bloggers will contribute as they have contributed to the social process in Iran. Despite all of its ups and downs its anniversary is worthy of remembrance, after all few events has contributed as much as blogging has does. It is indeed a meaningful anniversary.
The blog sphere in Iran is officially 10 years old. It started with a wave that crashed through social perceptions like a tsunami. Sometimes I think it was like us hearing our own voices. It is always startling when one records his or her own voice for the very first time and then listens to it. It is like a new discovery, sounds familiar, but unbelievable. Blogging in Iran was like that: familiar and yet unbelievable.
People discovered they are similar in ordinary and in extraordinary ways, it was like discovering others and self discovery. And we believed everybody else also sees the emperor naked. At the beginning it was exciting: people talked about their habits, their parties, some even spoke of their affairs and love life (not in a very elegant way). Still it was revolutionary.
Tsunami brought to shore many individuals who would have remained obscure, it is interesting to notice that many ended up working for professional media organizations. Some of the earliest bloggers were imprisoned and some like Hoder still are imprisoned. Some continued their studies and some used blogging to promote their businesses and ideas. Blogging was accepted as a media, easy to use and easy to follow. Revolution over, evolution has begun.
On the 10th anniversary many talked of pessimism, of lack of enthusiasm and fresh ideas and of passivity. I disagree. Certainly the excitement of the early days is gone and that is only natural. The maturity is setting in. Blogging has a significant role in Iran now and it is an established part of media. It will go on and bloggers will contribute as they have contributed to the social process in Iran. Despite all of its ups and downs its anniversary is worthy of remembrance, after all few events has contributed as much as blogging has does. It is indeed a meaningful anniversary.
Monday, July 04, 2011
From Tehran
In Tehran, it is hot and dry. The pollution could have been worse, still it manages to burn your throat. The streets are parking lots, it is impossible to find a spot to part your car. Driving is an adventure. The drivers stare at you and keep coming.... there is something psychological in that. They see you, but they do not see you.
The economy still is in transition, the new bills for public utility have sent shock waves through the economy. It is a guess but i do not think the households are done adjusting. The prices have gone up in some cases and are expected to increase even more by some. It is a bit traditional, in this economy consumers always expect price hikes.
Interesting observation: I have not seen any coffee shop or restaurant out of business, but it seems manufacturing sector is struggling (if one believes the word on the street). There are the latest Mazda, Lexus and other brands on the streets. I have seen several Porsche as well in Tehran. The cars are so diverse from old Peykans, valued at a few thousand dollars, to imported vehicles with prices hovering in 200K USD and above. The drivers all drive the same! This is Tehran.
The economy still is in transition, the new bills for public utility have sent shock waves through the economy. It is a guess but i do not think the households are done adjusting. The prices have gone up in some cases and are expected to increase even more by some. It is a bit traditional, in this economy consumers always expect price hikes.
Interesting observation: I have not seen any coffee shop or restaurant out of business, but it seems manufacturing sector is struggling (if one believes the word on the street). There are the latest Mazda, Lexus and other brands on the streets. I have seen several Porsche as well in Tehran. The cars are so diverse from old Peykans, valued at a few thousand dollars, to imported vehicles with prices hovering in 200K USD and above. The drivers all drive the same! This is Tehran.
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