More than 13 percent under poverty line in oil-rich Iran

from Persian Journal

The resignations of the two ministers came at a time when Iran's economy is experiencing problems with double-digit inflation, poverty and high unemployment.

Ahmadinejad was elected on a platform letting all Iran's population feel the benefits of its oil wealth but poverty remains a major problem in the Islamic republic.

More than 13 percent of Iranians live under the poverty line, a government minister was quoted as saying last week, amid increasing concern about the welfare of the worst-off in the country.

"Around 9.2 million people are living under the poverty line. That means 10.5 percent of people in cities and 11.0 percent in villages", Social Security and Welfare Minister Abdolreza Mesri said.

Iran's population is 70.4 million, according to the most recent census, which was carried out last year.

The Sarmay� newspaper quoted the minister as telling Parliament's Social Affairs Committee that two million of the poor live in extreme poverty, meaning that they earn less than 650,000 rials (70 dollars) a month.

Mesri's comments come amid increasing concern over rising prices in Iran, which have especially hit the worst-off and state employees on low incomes. Teachers, for example, earn less than 300 dollars a month.

Since the Iranian New Year in March the prices of basic foodstuffs, especially fresh vegetables and poultry, as well as services such as taxis have jumped higher. The central bank has forecast that inflation will reach 17 percent in the current Iranian year to March 2008, compared with an official rate of 13.5 percent last year.

But many economists dispute this figure, and Iranian parliamentary research has estimated that inflation this year is running at 22.4 percent on the back of money supply growth of a colossal 40 percent.

In June, a respected former prime minister, Mir Hossein Moussavi, made a rare public statement warning that increased poverty was threatening the basis of the Islamic republic.

A group of more than 50 prominent economists has twice written open letters to President Mahmoud Ahmadinejad warning that his high-spending policies risk fuelling inflation further.

The government insists, however, that it has inflation under control and that booming oil receipts allow it to splash out on necessary infrastructure projects.