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Iran’s economy minister impeached as inflation rises, currency falls

TEHRAN - Iran’s economy minister has been im-peached after parliament voted to dismiss him amid ris-ing inflation and a falling currency.

(Al Jazeera/Reuters)

Abdolnaser Hemmati was removed from office after 182 of 273 lawmakers voted against him, conservative parliament Speaker Mohammad Bagher Ghalibaf announced on Sunday, just six months after moderate President Masoud Pezeshkian’s government took office. In 2015, the Iranian rial was worth 32,000 to the United States dollar, but by the time Pezeshkian took office in July, it had plummeted to about 600,000 to the dollar on the open market. With regional tensions escalating recently, it dropped even further, trading hands in Tehran’s exchange shops and on its streets for about 950,000 rials to the dollar. The rial’s devaluation has led to widespread public discontent due to the rising cost of living and heightened inflation as the Nowruz New Year approaches this month.

Pezeshkian, who was present during the session of the Islamic Consultative Assembly on Sunday, defended Hemmati, a former central bank governor and presidential candidate. He told lawmakers: “We are in a full-scale [economic] war with the enemy. … We must take a war formation.” “The economic problems of today’s society are not related to one person, and we cannot blame it all on one person,” he added. During the impeachment proceedings, Mohammad Qasim Osmani, a lawmaker supporting Hemmati, argued that rising inflation and exchange rates were not the fault of the current government. He pointed to the budget deficit left by the administration of hardline President Ebrahim Raisi, which he said contributed to the economic instability.

Hardline lawmakers, who have been attacking Pezeshkian’s team since his government took office, argued that Hemmati was instrumental in Iran’s economic instability and could be “dangerous” for the country if allowed to remain in office.

Hosseinali Hajidaligani, a longtime hardline lawmaker, accused the minister of intentionally devaluing the national currency to fill government coffers with a short-term windfall that would cover budget deficits at the cost of harming the economy and average Iranians. Hemmati rejected the accusations and pointed to a 10-percentage-point reduction in inflation. He admitted that inflation still remained high, standing at 35 percent. He told lawmakers that his team was working hard to address the issue but warned that the process would take time.

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Iran’s economy minister impeached as inflation rises, currency falls