ASSESSMENTS

Why the Iranian President's Policies May Outlast Him

Jul 28, 2016 | 09:15 GMT

Why the Iranian President's Policies May Outlast Him
No matter what the results of Iran's next election, President Hassan Rouhani's economic policies will likely continue.

(CHAVOSH HOMAVANDI/AFP/Getty Images)

Summary

Over the past three months, a series of leaks and corruption allegations has rocked Iran's banking and financial sectors. The scandal has revealed, among other things, that civil servants and business executives are being paid as much as $230,000 a month. The revelation has provided President Hassan Rouhani's political rivals with new ammunition ahead of next year's election, planting yet another obstacle in Rouhani's path to re-election. Attempting to head off any further damage, Rouhani adviser Vice President Mohammad Bagher Nobakht announced July 26 that Tehran plans to cap government and private officials' monthly salaries at $3,200 and $6,200, respectively, a move that should put to rest the most controversial aspect of the entire affair.

The practice of generously compensating executives and government figures was in place well before Rouhani took office. But neither this nor the president's numerous economic achievements — inflation has fallen to single digits, oil exports have increased and foreign direct investment has risen to heights unseen in the past decade — will change the fact that the president has a hotly contested election ahead of him. With Iranian conservatives already leading a concerted effort to undermine Rouhani's social and economic reforms, another threat to the president's legitimacy may cut deep into his chances of securing a second term. 

Over the past three months, a series of leaks and corruption allegations has rocked Iran's banking and financial sectors. The scandal has revealed, among other things, that civil servants and business executives are being paid as much as $230,000 a month. The revelation has provided President Hassan Rouhani's political rivals with new ammunition ahead of next year's election, planting yet another obstacle in Rouhani's path to re-election. Attempting to head off any further damage, Rouhani adviser Mohammad Bagher Nobakht announced on July 26 that Tehran plans to cap government and private officials' monthly salaries at $3,200 and $6,200, respectively, a move that should put to rest the most controversial story of the entire affair. The practice of generously compensating executives and government figures was in place well before Rouhani took office. But neither this nor the president's numerous economic achievements -- inflation has fallen to single digits, oil exports have increased...

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