Rafsanjani's budget: an open admission of his policy failures

News agencies reported that Rafsanjani presented the regime's 1375 fiscal year budget (March 1996 to March 1997) to the Majlis (parliament). Many economic experts described the budget as a sign of the country's severe economic crisis and the continuation of the accelerating trend of stagflation at the time when the regime faces a $50 billion foreign debt.

Even when taking into account the official and publicly announced rate of inflation of 56.3%, this year's budget shows a 12% decline. Although, foreign observers in Tehran put the real inflation rate at 100%.

The 30% increase in the defense and the suppressive forces budget relative to last year is particularly significant because it clearly reflects the persistence of a policy of repression and more weapons' purchases by the regime. Besides, all ministries have been instructed to deposit part of their budget into an account that is set up for the regime's suppressive forces, including the Bassij.

In his speech to the Majlis, Rafsanjani tacitly acknowledged that the U.S. trade boycott has created problems for the regime such as difficulties in the production and sale of oil.

The budget clearly demonstrates the total failure of Rafsanjani's economic policies. In light of the 10% drop in oil revenues and the significant increase in indirect taxes, next year, the Iranian people will have to endure even greater economic pressures, something which will foment more discontent and social unrest.

Secretariat of the National Council of Resistance of Iran - Paris November 28, 1995

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