Sanctions and Floods: Iran Risks Sinking
Marina Forti 19 May 2019

Even as it is the worst disaster to hit Iran in the last 15 years, the recent floods have attracted little attention in the international media. Torrential rains battered the north, west and south-west of the country in the last weeks of March, that is during the Nowruz holiday season (the Persian New year starts on 21 March) and continued through mid-April causing massive floods across the country.

The scale of the devastation is huge. More than 2,000 cities and villages have been flooded in 24 out of the 31 provinces of Iran, according to official news. At least 78 people have been killed around 50,000 homes have been severely damaged or destroyed leaving half a million Iranians displaced. In total, two million people are now in immediate need of assistance, according to the Iranian Red Crescent; the consequences of the disaster are affecting many more, some ten million out of a population of 80 million.

Meanwhile, on April 22 the US Secretary of State Mike Pompeo announced that the Trump administration will not extend the sanctions waiver previously granted to eight countries to import Iranian oil, effectively making it even harder for Tehran to export its crude oil.

This is the latest step in the Trump administration’s strategy to put “maximum pressure” on Iran. (Since withdrawing from the nuclear deal—the Joint Comprehensive Plan of Action, or JCPOA—in May last year, the United States has slapped unilateral sanctions on Iran, notably on the energy and the banking sector, while “secondary” sanctions target third-party banks and companies maintaining business relations with Iran). Considering that hydrocarbons are Tehran’s main sources of foreign exchange, the new step will likely undermine the state ability to provide welfare and services to its citizens.

Floods and sanctions have no direct link, of course. But both are having a deep impact on a country already experiencing the legacy of the drought, a deepening economic recession coupled with high inflation, a collapsed currency, persistent labour conflicts, and a general sense of uncertainty. However the Iranian institutions move to cope with this multi-pronged crisis, it will be revealing.

 

Flooded with criticism

The aftermath of the floods has seen many polemics and widespread criticism of the government’s slow response to the disaster.

It is worth recalling that any country would be struggling to manage the kind of rolling disaster Iran has faced in recent weeks. Even so, public institutions have been accused of incompetence and mismanagement on top of poor planning. The lack of coordination between different authorities meant certain areas were not evacuated quickly enough and relief shelter was not organized on a sufficient scale, according to comments widely reported in the social media. Some experts spoke of a “man-made disaster”.

Then, of course, there has been the inevitably blame game and the political one-upmanship. While many in the hard-line opposition placed the government in the cross-hairs, President Hassan Rohani and other government officials laid the blame squarely at the feet of the Iranian Meteorological Organization for failing to provide accurate weather forecast (it later turned out that the heavy rains had indeed been announced). Soon after, provincial governors came in for a serve for failing to take action on that information.

Indeed, the first top official visit to affected areas occurred on 24 March, when First Vice President Eshagh Jahangiri travelled to the flooded province of Golestan and immediately dismissed the local governor from his post. Many saw this as an admission of the deficiencies of the public response.

Many are also pointing to the environmental lessons to be learned. There is indeed a bitter irony in the recent floods. Last January the Iranian parliament’s Research Centre issued an alarming report on drought affecting large parts of the country. It said that almost half of the Iranian population—i.e. about 37 million people—were facing severe shortages of drinking water last summer.

Given that the drought was expected to worsen, the report warned of possible social discontent and unrest within the next three years. Now, in a truly cruel irony, the areas affected by drought are precisely those devastated by the worst floods in half a century.

Paradoxically, the water crisis is likely to have been averted for some time thanks to the rains. Wetlands have been refilled and Iran has “an additional five billion cubic metres of fresh water in 172 storage dams across the country”, the Minister of Energy Reza Ardakanian recently announced. The price of this “drought relief”, however, are vast swathes of the country’s cities and rural areas (literally) underwater and millions of Iranians fleeing their flooded homes.

While the vagaries of drought and rain can be accounted for by abnormal variations in the climate, several experts have noted that the disastrous impact of the recent flooding is the direct result of deforestation. For decades, local forests have been razed, leaving soils exposed to erosion and unable to absorb water. President Rohani himself spoke of deforestation and bad management of rivers as one of the reasons for the disaster.

As an aside, we must then ask why so many licences have been issued in recent decades to build on river banks and even in dry river beds. Nevertheless, it remains true that problems such as deforestation, poor planning, and real estate speculation are not peculiar to Iranian and can be observed across the developing (and indeed the developed) world.

 

The Revolutionary Guards in relief mode

On the ground, the institutional response, while initially quite slow, is now is in full swing. The Iranian Red Crescent said it has mobilized more than 18,000 relief workers, many of them volunteers, to support those affected. The organization has been providing tents, blankets, food, water and other emergency supplies. In Khuzestan—the south-western province bordering Iraq and the Persian Gulf, where many oilfields are located—the Iranian drilling companies are helping to pump water out of flooded areas.

More importantly, on 15 April Iran’s Revolutionary Guard announced that it had taken the lead in relief operations, “using all its power” to minimize the damage. The Revolutionary Guards have deployed regular forces on the ground with but also the Basij militias (which operate under the Guards’ command), and with helicopters, engineers and medical units. Most pertinently, the Guards are coordinating the deployment of thousands of volunteers that are now delivering supplies, setting up tents, preparing hot meals and providing health care to the hundreds of thousands of displaced people.

Official agencies made a point to broadcast that Commander Qasem Soleimani—the head of the Guard’s elite Quds Forces—had decamped to flooded areas to take charge of supervising the relief effort. This will certainly add to the already huge popularity of the man credited with leading the Iranian effort against the Islamic State in Iraq and Syria. It will also cast Iran’s most important military institution in a much more positive light than is normally the case, especially since the United State recently added the group to its list of “international terrorist organizations”.

While many in Iran regard (not unfairly) the Revolutionary Guards as a pillar of internal repression, it is certainly true that the organization is displaying its deep social role as it assumes the role of lead agency of national disaster relief.

Arguably the most surprising intervention was that of an Iraqi paramilitary force. Hundreds of members of the Iraqi Popular Mobilization Unit (PMU) were rumoured to have entered Iran, with regular visas, to help with flood relief.

The news was officially confirmed on 12 April by the Iranian ambassador in Baghdad. In any case, many pictures had been shared on social media showing PMU militiamen working in flood-affected areas in Khuzestan and Lorestan, under both the Iraqi and the PMU flags.

Their presence was highly symbolic: after all, the last time Iraqi forces were on Iranian soil was in September 1980, after Saddam Hussein ordered the invasion that started the bloody eight-year Iran–Iraq war. Clearly this time things are different, as the forces of the PMU—itself created with Iranian help in 2014 after a call by the Grand Ayatollah Ali Sistani to help combat the Islamic State—entered after being invited

.

Meanwhile, the Iranian Red Crescent announced it had established a bank account to collect donations, supplementing its efforts to gather and distribute non-monetary bequests. On 6 April it had already received about US$9.5 million, according to a press release. A group of mainly reformist political and cultural activists issued a statement on 9 April calling all citizens to “show empathy and solidarity”.

The statement continued: “Now is the time to demonstrate national solidarity and provide relief, rebuild, and reduce the pain of our fellows Iranians”, with a further call “to line up our social, civil and institutional resources”.

At this time, little international aid appears to be forthcoming. The International Federation of Red Cross and Red Crescent Societies has launched an international emergency appeal for €5 million. Italy dispatched 40 tons of emergency supplies. Yet even humanitarian help is impacted by the sanctions. It was only on 2 May that the Iranian Embassy in Italy was finally authorized to set up a bank account to collect donations. Such authorization has not been forthcoming in any other European country at the time of writing.

 

Sanctions bite

The total damage bill from the floods could top US$8 billion, according to Iran’s Interior Ministry; in the agricultural sector alone, losses are estimated at US$350 million. These are clearly preliminary estimates, as a comprehensive assessment of the costs will only be possible when waters recede.

What is clear is that Iranians are bracing for challenging times ahead. The government announced that all affected citizens— particularly farmers — will be compensated. The speaker of the parliament, Ali Larijani, warned that the government will have to find additional resources because the 2019–20 budget is already stretched to the limit after expected oil income was revised downward.

This brings us back to the sanctions. Last year, before the US decision to withdraw from the nuclear deal and reimpose sanctions, Iran exported a daily average of 2.5 million barrels of crude. In March this had dropped to about 1.9 million barrels per day (of which 1–1.3 million barrels were counted officially, the rest exported through unofficial channels, according to recent estimates reported by the Financial Times). Further declines are expected as sanctions waivers are cancelled.

Even before the floods, Iran was in recession. In October, the International Monetary Fund predicted a 3.6% decline in GDP on an annualized basis; in early April it revised its growth forecast down to –6% for 2019. Sanctions are not the only reason for the crisis (other factors like tax evasion, capital flight, lack of investment, mismanagement and corruption should also be considered, as explained by Bijan Khajehpour, an Iranian analyst). Yet sanctions remain and are starting to bite.

Inflation, unemployment, and a long-standing backlog in investment are all negatively affecting ordinary Iranians. Will this lead to protests? Perhaps, given the many labour and social conflicts already endemic in Iranian society. But rather than expecting the regime to implode and fall, if the aftermath of the floods is an indication, an expanded role for the Revolutionary Guards is more likely.

 

Image: ATTA KENARE / AFP


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