Published: Thu, August 02, 2018
Global News | By Blake Casey

Iran's currency crisis triggers corruption crackdown

Iran's currency crisis triggers corruption crackdown

Since the beginning of the year, the Iranian rial has lost almost two-thirds of its value.

USA officials tell Reuters that the goal of Trump's push is to curb Iranian behaviour, which America, its Gulf allies and Israel say has fuelled instability in the region through Tehran's support for militant groups.

In May, the United States pulled out of a 2015 deal between world powers and Tehran under which global sanctions were lifted in return for curbs on its nuclear programme.

Iran's currency plumbed new depths on Monday, dropping past 120,000 rials to the dollar, as Iranians brace for August 7 when Washington is due to reimpose a first lot of economic sanctions following Trump's withdrawal from the nuclear deal.

This week, the Iranian currency dropped past 100,000 rials to the USA dollar.

In a statement released on Monday, Iran's central bank blamed the economic uncertainty on "plots by the nation's enemies to create unrest in the economy".

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The government has been in crisis mode, replacing its central bank chief last week.

But rather than choking off the illegal transactions, the introduction of a fixed rate allegedly has encouraged some traders to profiteer by charging higher black market prices for goods imported with dollars bought at the lower official rate of about 44,050 rials. Others have been apprehended and may be arrested on Monday, he said.

Iranian authorities investigating possible profiteering in vehicle and mobile-phone imports have also stepped up their arrests.

Apart from the rial's collapse, the Iranian private sector has always been starved of investment, its banking system is crippled by bad loans and record levels of unemployment mean a third of under-30-year-olds are out of work.

Rouhani has promised to accelerate efforts to prosecute corruption within the state and private sectors to allay Iranians' frustrations.

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