What Israel and Iran don’t tell you about their economies
Via President Obama, President Rouhani (Iran) and Prime Minister Netanyahu (Israel) have been slugging it out at the UN in New York.
Earlier this year, Rouhani, described as a reformist, won the Presidential election,claiming that he would improve the economic lot of his fellow citizens. He came to America, proffering a smile and words of placation. Israel sees the Iranian leader as a ‘wolf in sheep’s clothing‘.
Looking beyond the war of spin, mainly addressed to the world’s media, there is a simple litmus test. Let’s use Rouhani’s own measuring stick – the respective economies – in order to see who is doing the most for their own countrymen.
Starting with Iran, a recent Reuter’s report noted that international sanctions have cut oil exports, Iran prime source of finances, by 50%. GDP has fallen around 3% over the past 24 months. It is known that the annual inflation rate is over 40% and unemployment is climbing sharply above the 15% level.
Meanwhile, since Rouhani’s rise to power, there is no visible sign that Iran has ceased investing in an expensive uranium enrichment programme, whose sole obvious purpose is to manufacture offensive long-range nuclear weapons.
Turning to Israel, which has spent all of its 65 year modern history juggling resources between fighting existential threats while creating a modern society, the picture contains a visibly different set of colours. News items from the past week show:
- Unemployment has fallen to a 20 year low at a little over 6%.
- Recurring annual growth of around 3% and a tighter budget has ensured that the fiscal debt is now back under control.
- The Tel Aviv stock market rose by over 7% in September, ahead of structural reforms and new management.
- “The Yaskawa Electric Corporation from Japan, a global leader in planning and manufacturing industrial robots, is set to invest tens of millions of shekels in an Israeli company in the robotics industry.”
- Intel is expanding its operations by a further 800 workers.
- etc etc etc
You have to ask the question. What is more important to Rouhani? Does he want to keep his election promise and return Iran to its former economic glory, just where Israel is today? Or is that merely a ‘nice-to-have’, whereby his country’s threatening weapons programme is more of a priority?
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