China is making out big time from Iran's current economic plight and thereby worsening that plight in the long run.
Because the IRI is in no position to deal, it gets no mercy from Beijing. Thirty three years of anti-western, empire-questing policies (overt and covert) put the IRI in the position described by the Guardian. As a self-created pariah state, the IRI finds itself cut off from the global economy and almost totally dependent on China for survival.
Since Iran's domestic producers can't compete with China's cheap imports they are going bankrupt at record rates. As this occurs, Iran acquires the central trait of Third World economies--a total dependence on a raw materials for economic survival--in this case oil.
It gets worse. Whether the Third World good is oil, bananas or coffee, once a country becomes so dependent, any downward fluctuations in world prices for a given commodity hit especially hard because such economies lack the diversity to soften the impact. Alas for the IRI, e conomists predict major upcoming increases in suppy of oil (caused by new technology) will soon drive oil prices down.
The Guardian spares no detail in describing the consequences for ordinary Iranians.
SOURCE: "China floods Iran with cheap consumer goods in exchange for oil"
http://www.guardian.co.uk/world/iran-blog/2013/feb/20/china-floods-iran-cheap-consumer-goods
Comments 2 Pending 0
faraway
Report" As a self-created pariah state, the IRI finds itself cut off from the global economy and almost totally dependent on China for survival."
Tragic but true.
FG
ReportFURTHER OBSERVATIONS:
The mullahs are stuck with an either-or-disaster when it comes to cheap imports from China. Allow them and you gradually destroy domestic production or what hasn't been destroyed already.
Ban them and you immediately accelerate already outrageous inflation. That involves too many political risks. Another problem is that with so much domestic production already destroyed or bankrupt, domestic producers could hardly pick up the slack. That too would add to inflation.
Chinese imports and isolation from the global economy caused by Iran's own behavior isn't the sole cause of Iran's economic plight. Other causes include economic mismanagement and corruption, Islamized (rather than real) universities, the brain drain, IRCG economic monopolies (needed for mullah security), censorship and extreme persecution of the middle class (needed for mullah security).
None would be necessary or likely if Iranians had a real democracy with full civil rights and all political parties capable of competing. All such practices exist to serve the exclusive interests of the ruling mullahs and security force thugs.
Does anyone else matter in the Islamic Republic?