Iran’s support for foreign militias is destroying its economy

Iran’s support for foreign militias is destroying its economy

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The Iranian budget law of 2018 was not welcomed by the people, to exclude nearly 30 million people from subsidies, raise energy prices (especially gasoline) by up to 50%, and the rise in prices of many basic goods and services such as “electricity and fuel”, which Fuel enters the elements of its production, and the fuel used in transportation services, which negatively affects the middle class and drops the economy to its lowest levels, where relative poverty will become extreme poverty.
The Iranian Planning Organization revealed that the budget of 2018, amounted to 104 billion dollars, based on the price of a barrel of oil at 55 dollars referring to the local charges of the government to provide revenues and expenditures on foreign military interventions at the expense of the Iranian people’s food, which reached at the end of 2017, according to the Center for Iranian statistics about 80 million people, 40.5 million males and 39.5 million females.
The center noted that the number of families of the Iranian people reached 24 million families, an average of 3.3 people, 1.24 average population growth in the last five years, and the divorce cases amounted 50%.
“The budget of 2018 paves the way for poverty, stagnation and unemployment and puts the people under severe financial straits, with more than 50 percent of the Iranian population living below the poverty line,” the Kayhan newspaper reported that it belongs to the current of Murshed of Iran Ali khamenai .
Due to the disruption of economic policies in Iran, the unemployment rate in 2017 rose to large levels, according to official figures, it is 12.5%, and the Revolutionary Guards’ allocations reached to 7.6 billion dollars, compared to 4 billion dollars in the previous budget. ”

Support has been cut for millions of people ($ 11 per person per month) as well as raising energy prices to provide cash for the 2018 budget, parliament speaker Ali Larijani said.
Larijani said the Iranian government was determined to reduce education and health budgets and build development projects because of its financial deficit and inability to reduce the budgets of religious and other institutions.
Iranian Interior Minister Abdul Ridha Rahmani Fadhli announced that the current unemployment rate in Iran is more than 12%, while in some cities in the provinces of Kermanshah (Kurdish), Ahwaz (Arab) and Balochistan reached 60%.
A spokesman for the Iranian government and head of the Planning and Budget Organization, Mohammad Baqir Nobkht, justified raising fuel prices by providing job opportunities for the unemployed.
Despite the economic achievements achieved by Iran with the West after the nuclear agreement, it recovered part of its share in the world oil market and the rise in production and exports, but these achievements faced many economic challenges, unemployment reaches 12.5%, and increase rates for 26% for the age groups 15-29 years Which calls for structural reforms in the Iranian economy, the banking system, combating the spread of corruption and removing obstacles to foreign investment.
The United Nations has warned Iran about developing its nuclear program, but the latter has not responded and ended with economic sanctions against Iran, which has led to a drop in foreign investments in the Iranian economy and a reluctance of many international banks to cooperate with them that makes the Iranian economy to face difficulties especially the industry led the economy to be in a sharp rate of 1.6%.
Economists and experts said Iran’s economy is fragile and weak, as it finances and supports foreign financial and military organizations, including the Houthis in Yemen, the Lebanese Hezbollah and Iran’s armed groups in Iraq and Bahrain, such as the Revolutionary Guards, whose allocations amount to $ 7.6 billion by 2017.

The Iranian government is hiding the size of the real financial cost that the Iranian budget supports for its overseas organizations and the magnitude of Iran’s economic losses as a result of its continued support for these organizations, which are deducted from the development share that can be directed to Iranian youth.
The reality in Iran shows the depletion of the wealth of Iranian society in favor of an expansionist project based on the use of the so-called fifth column in the heart of the Arab world to dominate it, as well as the deployment of the IRGC, which trains, arming and funds sectarian militias inside and outside Iran.
Iran has had a strong opportunity to reform its situation and return to the global economy in the time of US President Barack Obama, but did not prove the peace of intentions and stop interfering in the affairs of others, and concerned with reform and economic development, but continued to threaten and intervene abroad and increase the arming of its army and militias outside its borders , and continued with non-moderate nuclear ambitions, which made the US administration led by Donald Trump to consider the Iranian file as a threat to regional and global security and peace.
Iran’s lack of opportunity to serve its economy and people has made the world worry about Iran’s economy and its ability to sustain expected growth of 3.3 percent.
This new growing concern is evident in the IMF report, warning of the severe uncertainty surrounding the future of Iran’s economy as the United States imposes new sanctions on Iran as a result of its development of ballistic missiles and its continued involvement in neighboring countries.
The report of IMF said that the tension between Iran and the United States and the lack of clarity of Iran’s true intentions, despite the opportunity granted to them reduces the opportunity for growth of investment and trade with Iran, and in the event of the collapse of the nuclear agreement, Iran will return to isolation from the global financial system, and the Iranian economy enters into a state of recession inevitably, especially with the decline of foreign direct investment and capital inflow .
Iran’s external spending
Iran spends billions of dollars to support its foreign militias and at the same time ignore its poor in order to extend its influence, expand and control outside its borders and try to spread the ideology of the Wilayat alfaqih that controls its rulers.
one of the most important Iranian arms that has the largest share of the funds of Iranian people is the Lebanese Hezbollah, which was founded in the early 1980s with financial and political support from Iran despite its attempt to find other ways for funding such as money laundering and drugs but the Iranian support remains the backbone for its internal and external operations and activities .

Former US Assistant Secretary of State Denis Ross has confirmed that Washington is closely monitoring the funds sent by Tehran to a number of its armed militias in the countries of the Arab world, pointing out that the bill for Iran’s support for Lebanon’s Hezbollah militia amounts to about 800 million dollars annually.

Foreign reports confirm that Hezbollah receives from Iran, in addition to financial support, weapons, training, and intelligence support, logistical and other assistance, road reconstruction and infrastructure restoration in Lebanon in 2007.
Tens of billions of dollars went to Assad from the funds of the fifth available to Khamenei.
The Iranian funds are channeled through dedicated officials by transferring financial support in Quds Force of the Iranian Revolutionary Guards, the external arm of Tehran to carry out intelligence operations outside Iran through charities established by Tehran under the pretext of charity, such as the Khomeini Relief Foundation in Lebanon.
The deterioration of the economic situation in Iran led to the outbreak of the revolution of the poor, whose march is still going on in the streets of major cities until the writing of the article, a price for supporting the country to sectarianism and militias in the region and a tax paid by the poor of the people. And voices of the protestors were high calling their officials to get out of Syria and Lebanon, chanting slogans: “Pull out of Syria and think about us” and “No to Lebanon or Gaza , our lives are a sacrifice to Iran. ”
The demonstrators called for improving the situation inside Iran, focusing on improving the living conditions of its citizens and stopping the spending of the Iranian people’s money on regional issues and extending the influence of the regime in the region through interference in Syria and Tehran’s support to its arms in the region, and on the forefront Hezbollah in Lebanon, Hamas in Palestine, and Houthis in Yemen .
Why adhere to Hezbollah?
The Iranian regime claims that the huge funds and the high cost incurred by Tehran to support its arms in the world while depriving its people of it is due to the view that it will reap the fruits of what was spent by spreading its influence in Lebanon and strengthening the party to form a state within the state to have the high word in all political affairs , and Tehran can dictate its policies on it , which has already happened and caused several crises in Lebanon, beginning with the crisis of the presidential vacuum that Lebanon experienced for more than two and a half years until the election of General Michel Aoun in 2016, the crisis of resignation of prime minister ,Lebanon Saad Hariri in last November, a protest against the policies of the party and pushed Lebanon into involvement in the war in Syria under the pretext of fighting terrorism to implement Tehran’s agenda.

Apart from the Lebanese interior, Tehran exploited the party in favor of Iranian expansion, through which it managed to intervene in Yemen and support the Houthi militia loyal to it.

The party has become a pressure card for Iran against its adversaries in the region. It is able to move it to ignite the front with Israel to exert pressure on the United States and its allies in the Middle East, who are in the range of the party’s fire by recruiting sleeper cells in the Arab countries.
Israel’s chief of General staff, Lieutenant-General Gadi Eizenkot, said Iran spends hundreds of millions of dollars a year on helping its allies fighting in the Middle East, and this spending seems to be increased.
Eizenkot’s remarks coincided with marches that have been going on for weeks in the streets of Iran, initially focused on economic difficulties, but turned out to be overt political protests.

Eizenkot accused Iran of working to form a “Shiite crescent” to spread its influence, stretching across Iraq, Syria, Lebanon, Yemen, Bahrain and the Gaza Strip.
Iran is seeking regional hegemony, Iran’s annual funding of Hezbollah is between $ 700,000 and $ 1 billion a year, Eizenkot said. “In recent months, Iran’s investment in the Palestinian arena has grown motivated by a desire to extend its influence by increasing the (annual) funding in the Gaza Strip of the Hamas and Islamic Jihad movements to $ 100 million.”
Where are the Iranian protests going?
The head of Iran’s Nobel Peace Prize Laureate in 2003, Shirin Ebadi, criticized Iran’s spending on its military interventions in the region, saying that military spending in Syria, Yemen and Lebanon has led to a weak budget and widespread poverty in Iran, and urged Iranians to civil disobedience against the regime.
Ebadi called on the Iranians to “stay on the street”, abide by the civilian character and avoid violence, noting that “this right is recognized by the Iranian constitution.” It also called on them not to pay bills for water, gas, electricity and taxes, and to withdraw funds and balances from government banks to exert economic pressure on the government and force them to stop violence and respond to their demands.
Ebadi pointed out that poverty caused public outrage led to the emergence of demonstrations that were purely economic in the beginning before the slogans moved to target the nature of the system.
The expert in the Iranian economy, Professor Ismail Hussain zadeh, the inability to identify a specific number on the total cost of supporting the Iranian economy to foreign organizations or to each organization alone in the Arab world.

It is difficult to determine the size of Iran’s spending on its militias, as Zada sees it according “to the following:
– The process of financial support is not formally recorded in the official papers, and appears as a clear and detailed item in the general budget.
– There are more than one party in the state contribute to the financing of these organizations in different proportions.
– The process of financial support does not fall within the traditional methods such as providing funds directly to the leaders of these organizations; it is true that sometimes this happens.
– International concern about some of the parallel organizations of official state institutions. Iran’s financial support to its militias is carried out in twisted ways, for example, the Iranian government buying huge deals of carpets from Iranian merchants and then selling them to some Lebanese merchants who support Hizballah at very low prices, and those in turn sell them in local and even regional or international markets and financing party through profits from the sale in countries such as Yemen, Lebanon and Syria in which there are no strong central governments, the system is tax or banking in the real sense, there is strict control of government authorities on deposits and remittances, and mostly ,Iran indirectly funds these organizations through trade deals with the financial wings of those armed groups, which have gained considerable experience in financial fraud , Iranian funds are then brought directly into the banks of countries, but under false names and addresses. ”
“Iran funds these organizations with weapons, or pays the bills of arms deals that these organizations hold with the international arms mafia in Eastern Europe and some Latin American countries, and all this makes it almost impossible to put a fixed figure on the value of Tehran’s funding for these organizations,” he said.

However, it is possible to say that the total Iranian funding for the organizations will be between $ 5 billion and $ 7 billion per year under normal circumstances and periods of relative calm. This can be calculated from the total number of members of these organizations where Iran pays to them monthly financial allocations an also from the size of the expansion of the activities carried out by those organizations socially to recruit more members.

The total value of the financial support of the Houthis, Hezbollah and its militias could reach more than $ 10 billion a year. This does not include the cost of funding heavy weapons such as Iranian missiles that recently targeted Saudi Arabia. ”

Shatha Khalil
Economic unity
Rawabet Center for Research and Strategic Studies