Parallels
5:28 pm
Thu June 13, 2013

As Sanctions Squeeze, Iranians Keep Improvising

Originally published on Thu June 13, 2013 6:59 pm

Iranians have lived with American sanctions for many years, and we could see the evidence of this when we stepped into a Tehran shop called GM Auto Parts.

It had the famous blue and white General Motors logo, though the sign, like almost everything in the spare parts shop for American cars, looked decades old.

The silver-haired owner, Sadegh Janati, showed us catalogs of cars and parts that he used to import from the U.S. in the 1970s. They came straight from GM, he said, until the years after Iran's 1979 Islamic Revolution, when U.S. limits on trade with Iran began choking his business.

But people keep ordering spare parts. The caller on Janati's ancient phone was asking after a fuel line.

To service old American cars, like Janati's own Chevy Caprice Classic, he used to have a man in America ship him auto parts in the luggage of travelers. Then, just a few weeks ago, he made a discovery. He went on a pilgrimage to the holy city of Mecca, Saudi Arabia, where there are many American cars — and spare parts stores.

He showed us spark plugs he bought on the trip. Iranians have improvised this way for years, but now the improvisation is getting desperate.

U.S.-led sanctions, aimed at pressuring Iran over its nuclear program, grow tighter and tighter. Oil production is way down. International banking transactions are now much harder.

The latest round of sanctions will make it tougher for Iranians to get spare parts even for their European autos.

Shrinking Options

Some business leaders say they're running out of options.

Sadegh Samii, a publisher who also runs an inspection service for imported goods, says sanctions are a major issue. "Well, we have to come to a certain conclusion with U.S. of A. and Europe."

This has not been the official line of Iran's government, which has urged resistance to what it calls U.S. imperialism.

"They say that we go around the sanctions, but it is making life difficult, really difficult," Samii says. "Because I'm an inspector and I see the goods coming into this country and how difficult, how almost impossible it is for certain traders and merchants to transfer money for imported goods."

Banking sanctions are making it harder to complete transactions, and new sanctions also target Iran's currency, which has already collapsed in value.

U.S. sanctions are now among the biggest issue in Iran's presidential campaign. But not everybody agrees that it's time to cut a deal over Iran's nuclear program.

"The most important thing for us is to resist against the United States because you and your government attack [our] economy," a college student named Ali said at a campaign rally Wednesday for Saeed Jalili, a leading candidate.

I asked Ali how Iran can survive its economic trouble. He cited one of Jalili's major slogans: building a "culture of resistance" against the West.

Jalili hasn't made clear what this means, but he appeals to Iranians who simply do not believe they can or should give in to the U.S.

Soon the college students sat cross-legged on the soccer field and joined the chants of "Death to America."

They also said "Death to Israel," chants Iranian conservatives have repeated for decades.

Close Ties To The Supreme Leader

Jalili is Iran's main nuclear negotiator, and his views on everything from the nuclear issue to the role of women are believed to closely track those of Iran's supreme leader, Ayatollah Ali Khamenei.

Jalili has the support of other prominent clerics. To test that support, we visited a city that's full of clerics: the holy city of Qum, outside Tehran.

It's a center of learning for Shiite Muslims and also a destination for thousands of pilgrims, one of the most vital places for the Shiite faithful.

It was easy to find people in Qum who support Jalili, but their support was not unanimous.

A cleric named Ali, who's studying in a theological school here, said he's voting for a different candidate, Iran's onetime foreign minister, Ali Akbar Velayati. "He's a moderate and quiet person," Ali said. "We have an expression: to move in second or third gear."

A country needs moderation, he said, and doesn't have to move at a high speed. His candidate has publicly challenged Jalili's tough stance on negotiating with the U.S.

Many of the remaining candidates have clashed over the nuclear diplomacy, suggesting a divide in the country's elites. But that doesn't mean Iran is sure to bend.

A Few Winners

Back in Tehran, we visited a string of upscale apartment buildings under construction on the northern side of the city, where many of the elites live on slopes of a mountain, with cooler air.

The engineer overseeing the building where we stood had a simple explanation for all this construction: "We have lots of rich people in Iran," he says.

Even in hard times, when many people lose ground, some profit. Inflation means people with real estate, or warehouses full of goods, can sell for more.

Smugglers profit offering to slip in contraband goods. Larger corporations are still maneuvering to bypass Western sanctions when they can.

Petrochemical products, for example, may not be sold to Europe but might still be sold to Chinese firms.

Iran's economy is teetering. But many firms are copying that GM Auto Parts guy on a grander scale, trying to hold off disaster as long as they can.

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

AUDIE CORNISH, HOST:

It's ALL THINGS CONSIDERED, from NPR News. I'm Audie Cornish.

MELISSA BLOCK, HOST:

And I'm Melissa Block. Iran holds its presidential election tomorrow, and it's more strictly controlled than ever. The government is trying to avoid a repeat of 2009, when allegations of vote-rigging led to massive protests and violence. This time, security forces guard the streets, independent newspapers are under pressure, and the Internet has slowed down.

Still, a debate has emerged over a vital issue. Iran's devastated economy, battered by U.S.-led sanctions. Our colleague Steve Inskeep has been reporting this week from Iran. He sent this story.

STEVE INSKEEP, BYLINE: Iranians have lived a very long time with American sanctions, as we learned when we stepped into a shop called GM Auto Parts. It had the famous, blue and white General Motors logo, though the sign, like almost everything else in the shop, looked decades old.

(SOUNDBITE OF CONVERSATION, BACKGROUND STREET NOISES)

INSKEEP: It had the famous, blue and white General Motors logo though the sign, like almost everything else in the shop, looked decades old.

I see hubcaps, bumpers...

It was a spare-parts store for old, American cars. The silver-haired owner is Sadegh Janati. He showed us catalogs of cars and parts that he used to import from the United States in the 1970s.

SADEGH JANATI: (Foreign language spoken)

INSKEEP: They came straight from GM, he said, until the years after Iran's 1979 revolution, when U.S. limits on trade with Iran began choking his business. To service old American cars, like Janati's own Chevy Caprice Classic, he used to have a man in America ship him auto parts in the luggage of travelers.

Then, just a few weeks ago, he had a revelation. He went on a pilgrimage to the holy city of Mecca, in Saudi Arabia. Through our interpreter, he explained that the Saudis have many American cars and many spare-parts stores, which sold him spark plugs.

OK. So you didn't go to Mecca to find auto parts, but you found auto parts in Mecca and now, you found a new supplier of auto parts.

JANATI: (Foreign language spoken)

INSKEEP: Iranians have improvised this way for years, but the improvisation is getting desperate. U.S.-led sanctions, aimed at pressuring Iran over its nuclear program, grow tighter and tighter. The latest round of sanctions will make it hard for Iranians to get spare parts even for their European-brand autos. Some business leaders say they're running out of options. And one of those leaders is Sadegh Samii. He's a publisher who also runs an inspection service for imported goods.

What are some of the really big questions facing this country right now - about its present, about its future?

SADEGH SAMII: Well, sanctions. Sanctions, definitely.

INSKEEP: What to do about that?

SAMII: Well, I mean, we have to come to a certain conclusion with U.S. of A. and Europe.

INSKEEP: This has not been the official line of Iran's government. Up to now, the government has urged resistance to what it calls U.S. imperialism.

SAMII: They say that we go around the sanctions. But it's making life difficult, really difficult - because I'm an inspector, and I see the goods come in to this country and how difficult - how almost impossible - is for certain traders and merchants to transfer money for the imported goods.

INSKEEP: Banking sanctions are making it harder to complete transactions; and new sanctions also target Iran's currency, which has already collapsed in value over the last few years. U.S. sanctions are now among the biggest issues in Iran's presidential campaign.

(SOUNDBITE OF WOMEN CHANTING)

INSKEEP: But not everybody agrees that it's time to cut a deal over Iran's nuclear program.

(SOUNDBITE OF WOMEN CHANTING)

INSKEEP: Wednesday was the final day of campaigning allowed before Friday's election. And on Wednesday, we attended a rally for a leading candidate, Saeed Jalili. These cheers came from the women's section. Hundreds of women sitting in bleachers, every one dressed in black under the blazing sun.

(SOUNDBITE OF CHEERS)

INSKEEP: The candidate's male supporters spread out on a soccer field, awaiting their candidate's arrival. A group of college students shook our hands, and then one pointed a finger at me.

ALI #1: The most important thing for us, and Iran people, is to be - resist against United States because you and your government attack to us in economy. OK?

INSKEEP: This man gave his name as Ali. I asked him how Iran could survive its economic trouble, and he cited one of Jalili's major slogans: building a culture of resistance against the West.

A culture of resistance ...

ALI #1: Yes...

INSKEEP: ...will improve the economy?

ALI #1: Yes. I know, I know our economy - in our economy in Iran, there are many problem - big problem, OK?

INSKEEP: But he said an Islamic theory of economics, along with resistance culture, will help. Jalili has not made clear what this means, but he appeals to Iranians who simply do not believe they can, or should, give in to the United States. Soon, the college students sat cross-legged on the soccer field and joined the chants of "death to America."

(SOUNDBITE OF CHANTING)

INSKEEP: Saeed Jalili is Iran's nuclear negotiator. His views on everything from the nuclear issue to the role of women, are believed to closely track those of Iran's supreme leader, Ayatollah Ali Khamenei. Jalili has the support of other prominent clerics, too. And so to test the depth of that support, we visited a city that is full of clerics: the holy city of Qum, outside Tehran.

It's a center of learning for Shia Muslims and also, a destination for thousands of pilgrims, one of the most vital places for the Shia faithful. It was easy to find people here who supported Saeed Jalili for president, but their support was not unanimous. A cleric named Ali, who's studying in a theological school here, said he's voting for a different candidate, Iran's onetime foreign minister, Ali Akbar Velayati.

ALI #2: (Through interpreter) Because he's a moderate person, a moderate and quiet person.

INSKEEP: A moderate and quiet person - would that make him different from Mr. Jalili, or someone else?

ALI #2: (Foreign language spoken)

INSKEEP: By way of an answer, he said, we have an expression: to move in second or third gear. A country needs moderation, he said. We don't have to move at a high speed.

His candidate, Velayati, has publicly challenged Jalili's tough stance on negotiating with the United States. In a televised debate, in fact, several candidates sharply criticized each other's nuclear diplomacy, suggesting a divide in the country's elites. But that doesn't mean Iran is sure to bend. One possible reason Iran might not is expressed by a shopkeeper in the bazaar, in the gold market in Qom. Speaking with us in Spanish, he told us sanctions do no hurt everyone equally.

UNIDENTIFIED SHOPKEEPER: (Spanish spoken)

INSKEEP: Sanctions are very difficult for the people, he said, but the government is rich, so sanctions don't matter to them.

(SOUNDBITE OF CONSTRUCTION WORK)

INSKEEP: We saw evidence of this back in Tehran, the capital. The city climbs up a mountainside. The elites tend to live on the high side, in the cooler mountain air; and in that area, we discovered a string of upscale apartment buildings under construction.

I see a building over here. I see another here. I see a building we're standing in; a building under construction across the street, almost done. One that's just beginning down there.

The engineer overseeing the building where we stood had a simple explanation.

UNIDENTIFIED ENGINEER: We have lots of rich people in Iran.

INSKEEP: Even in hard times, when many people lose ground, some profit. Inflation means people with real estate or warehouses full of goods, can sell for more. Smugglers profit offering to slip in contraband. Larger corporations are still maneuvering to bypass Western sanctions, when they can. Petrochemical products, for example, may not be sold to the Europe Union, but might still be sold to China.

Iran's economy is teetering. But many firms are copying that GM Auto Parts guy on a grander scale, trying to hold off disaster as long as they can.

BLOCK: That's MORNING EDITION host Steve Inskeep, reporting from Tehran. Transcript provided by NPR, Copyright NPR.