Iran’s economy: Counting the cost of war

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Business Daily 18 min 5 speakers 4 chapters transcribed 5 months ago
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How is the war in the Middle East affecting Iran's economy?

Tejas Isai 0:00
This BBC podcast is supported by ads outside the UK. What happens when you design healthcare around people, not systems? I'm Tejas Isai, special host of Resilient Edge, a business vitality podcast paid and presented by Deloitte. Learn how Deloitte, AWS and Elevance Health are turning fragmented systems into effortless, intelligent care. Available now, wherever you listen to podcasts.
Unknown 0:28
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Rahul Tandon 0:47
Hello and welcome to Business Daily from the BBC World Service. I'm Rahul Tandon. Today we're looking at how the war in the Middle East is impacting Iran's already faltering economy.
Unknown 0:59
Many people have lost their job because of the war. Many company offices have been damaged.
Rahul Tandon 1:04
And asking how much will it cost to rebuild it?
Beran Tajdin 1:07
There are some estimates, and I would say these are conservative estimates, that would suggest that the first month of the war imposed a damage of around $100 billion.
Esfandia Badmengelesh 1:18
And where will that money come from? The sanctions relief is far more valuable for Iran economically than any revenues they might gain from traffic in the street.
Rahul Tandon 1:28
That's all coming up here on Business Daily from the BBC. Those are the sounds that many Iranians have been waking up to. So here on Business Daily, we wanted to look at the state of Iran's economy. Let's be honest, it is very difficult to get an accurate picture of what is taking place inside Iran. The internet has been turned off now for more than 40 days. Some people, though, have been using Starlink. That's a satellite-based internet system developed by Elon Musk. It's harder for the authorities to shut down. And some Iranians have been using that to communicate with the rest of the world. And they've been sending messages about the economic challenges that they're facing on a daily basis to our Persian service.
Rahul Tandon 2:24
The Iranians sending us those messages are often putting their lives in danger by doing that. So we've voiced up what they've told us.
Unknown 2:33
Many people have lost their job because of the war or have been placed on unpaid leave. Many company offices have been damaged. I don't see a bright future for Iranians at the end of this. With all these attacks, Iran won't be a place we can live in anymore. So many small businesses have already disappeared and the others will fade away too. Those attacks on some petrochemical and steel companies are going to directly affect people soon.
Beran Tajdin 2:59
We have all become miserable. Everything on the market is expensive. Paying back our bank debt, rent or insurance has become hard because of the inflation. I swear to God our salaries are not enough anymore. I feel I'm going crazy.
Unknown 3:13
Our lives have fallen back due to the war. We can't leave the house because it's dangerous. And we can't work. How are we supposed to make a living? It's a really bad situation. Everyone is facing the same difficulties. Our checks getting bounced back. We can't go on like this for much longer.
Rahul Tandon 3:33
Amongst those gathering and listening closely to those messages has been Beran Tajdin, the BBC Persian Service's economic correspondent.
Beran Tajdin 3:44
since the start of the war, the Iranian economy has moved into an economy of survival. That means that people, if they have any money, they will only spend it on essentials, which means large parts of the economy have gone into a full state of freeze. And that causes recession because many people are not paid. On top of that, we have had so many attacks on Iranian infrastructure, industries. And as a result of that, it has brought a large wave of unemployment to Iran.
Rahul Tandon 4:21
Can I ask you about Iran as a country as well? Because there are the urban areas, and that is where a lot of people would be losing their jobs. But there is a huge rural community in Iran as well. Do we know what the situation is like for them?
Beran Tajdin 4:34
It's not going to be easy because, you know, when petrochemical plants are... then they can't produce fertilizers, which means that the farmers cannot produce as much food as they could before.

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