Sanctions relief would not benefit ordinary Iranians

 By Dr. Majid Rafizadeh

Iranian leaders across the political spectrum, including the hard-liners, “moderates” and “reformists,” have been vocal and in agreement on one particular issue: They want sanctions relief from the US.

Even Supreme Leader Ali Khamenei, who was very reserved about expressing his opinion publicly when the 2015 Joint Comprehensive Plan of Action (JCPOA) nuclear deal was first reached, has been impatient about having sanctions lifted. In remarks broadcast by state television this month, he said: “We have to be careful (that the dialogue is not conducted) in a way that parties drag (out) the negotiations, as that is harmful for the country.” He had previously said: “Recently, we set a condition and no one will go back on it: The condition is that if they want Iran to return to its JCPOA commitments — some of which have been canceled — the US has to lift all sanctions.”
It is understandable why the paramount leader of Iran has been very impatient for the sanctions to be lifted, as they have bankrupted the regime financially and politically and brought Tehran to its knees.
Through sanctions relief, the regime would be able to breathe a sigh of relief, as it would be allowed to increase its oil exports, do business with more countries and corporations, particularly European companies, and attract foreign investment, specifically for its oil and gas projects.
The question now is what would the Iranian authorities do with its increased revenues — potentially billions of dollars — if US sanctions were lifted? First, we need to consider who might be the initial recipient of the extra money: Private companies, ordinary people, the government or other entities.
Iran’s economy is state-led, with two major entities controlling a significant part of the economy: The Office of the Supreme Leader led by Khamenei and the Islamic Revolutionary Guard Corps (IRGC). Iranian opposition group the National Council of Resistance of Iran in 2017 released a book entitled “The Rise of the Revolutionary Guards Corps Financial Empire,” in which it demonstrated that the IRGC controls more than half of Iran’s gross domestic product and owns several major economic powerhouses and religious endowments. The IRGC and its front companies have a stake in almost every sector of Iran’s economy, including construction, transportation, telecommunication, banking, and insurance.

One of Khamenei’s major organizations is Ejraiye Farmane Hazrate Emam (Setad), which is rarely spoken of. Setad is worth at least $95 billion. Roughly half of its holdings are invested in the corporate field and the other half in real estate, mainly through “the systematic seizure of thousands of properties belonging to ordinary Iranians,” mostly dissidents and foreign expatriates, according to Reuters. Setad enjoys the advantage of monopolizing certain sectors, exploiting the nation’s wealth and bending the law in order to maximize its profits. Such a financial empire gives Khamenei critical economic and political leverage over the regime’s apparatuses, politicians and opposition. This allows him to expand his circle of loyalists and foreign proxies and easily crush dissidents.
As a result, the supreme leader and the IRGC would be the first recipients of any extra revenues and they would more than likely use such funds to strengthen their own apparatuses and guarantee the survival of the regime. This would also allow Khamenei and the IRGC to more easily crack down on any unrest against their theocratic establishment.
Now that it is clear that the extra revenues would first be funneled into the treasury of the IRGC and the supreme leader, the next step is to analyze their other priorities.
The second priority of the regime involves exporting its revolutionary ideals to other countries, advancing its hegemony in the region, and ensuring the survival and empowerment of its militia and terror groups, which are mandated to promote the regime’s interests and ideology across the Middle East.
This means that state and non-state actors such as the Houthis, Hezbollah, the Shiite militias in Iraq, and Bashar Assad’s Syria would be the next major beneficiaries of any sanctions relief. Of course, since corruption is rampant within the Iranian government, some government officials would also benefit from any sanctions relief and increased trade.
The regime could also be expected to spend some capital to enrich its loyalists domestically and empower groups such as the Basij in order to detect and crush dissent and any potential uprising.
In summary, the beneficiaries of sanctions relief will not be the ordinary people of Iran, but the IRGC, Khamenei and their network of loyalists and militia and terror groups across the region.

• Dr. Majid Rafizadeh is a Harvard-educated Iranian-American political scientist. Twitter: @Dr_Rafizadeh

This article was first published by arabnews