We are back!
I know, when we sent the last issue of Iran Economy in Brief in 2020, we promised to be back in January 2021. However, life got very tough (all of a sudden) and with good excuses, we have not been able to send you anything for the past entire three months.
But we did not give up. Now with the Iranian new year 1400, we are back and will do our best to share interesting stories about the Iranian economy with you again.
Would you like to support us? Please share our stories with others as the most important asset for us are our readers.
While in the last months of the past Iranian year 1399, we were fighting to save the most important person of our family, some others were struggling to increase their minimum income for the coming year in order to survive the inflation and rising prices.
After several discussions, finally the government approved a 37% increase in the minimum wage for workers. This means that a labourer/worker with one child should not be entitled to an income lower than 37 million rials per month ((circa 148 USD at market exchange rate).
This figure a year ago was 27 million rials per month.
The minimum income for 1400 was very much criticised by the activists of labourers’ rights. They claim that according to the latest estimations by the Islamic Council of Labourers at the Parliament, the minimum of expenses for a family with one child stands around 87 million rials per month. This is while the government is requiring the half of this amount as the minimum payment.
On the other hand, of course, the employers say that in the current economic situation where the country finds itself, it is even difficult to meet this new minimum as well!
As a result, like even in developed countries, to avoid frictions with the Ministry of Cooperatives, Labour, and Social Welfare, they use all kinds of possible tricks not to meet the requirement.
Almost no company in Iran makes a contract for more than a year and even make shorter contracts and once in a while do not renew the contract immediately to avoid claims that the person was hired for the entire year.
Considering that the problem, i.e. the fight between labourers and employers is an international problem, one would ask if there is not a better solution?
Perhaps, the fact that both parties consider the other as an enemy, instead of a team-mate, could explain it. While a company without its workers cannot exists, majority of people without employers cannot earn either. But it is almost impossible to find an example where both parties were happy about the minimum income. Always one is a victim.
There is no doubt that prices in Iran are increasing in a dramatic way. According to the Central Bank of Iran the annual rate of inflation is around 37%.
The Centre of Statistics of Iran compares prices in March 2020 and March 2021 and concludes that prices have been up by 49%. One expects that prices go higher for the newly started year much further.
“Should the situation remain as it is, we have to expect an inflation rate of 65% and exchange rate of 350 thousand rials for a USD”, suggests Afshin Kolahi, Representative Member of Tehran Chamber of Commerce.
A Persian idiom says that
“You can tell a good year from its spring (beginning)”
سالی که نکوست از بهارش پیداست
Well, shall this spring bring some good news for Iranians and those who love Iran? Let’s remain optimistic!