The Sanctioned States: Economic Crises in Iran and Turkey
Source:The Moshe Dayan Center Date:25Oct2018
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Turkey is better placed to get out of the crisis than Iran. The crisis over US sanctions could be easily resolved and Turkey has some bargaining power in Europe over Syrian refugees. The central bank’s decision on interest rates could be first step towards financial repair. This is, however, too narrow a view. Turkey’s crisis is systemic and results from the fact that so much power has been concentrated in the hands of the President. The government has been less transparent, and its decisions are not based on improving the economy but on maintaining the political status quo.
Iran suffers deep political splits within the regime and between it and large sections of the public. Its economy is totally dependent on oil, exports of which are being increasingly restricted. The regime sees its involvement in conflicts in Iraq, Syria, Lebanon and Yemen as the front line of its defense of the Islamic Revolution despite the fact that there are ever fewer resources to fund them. Most importantly, the regime retains the monopoly of force and a willingness to use it against its opponents at home as well those abroad.