The Islamic Republic was born in if not out of an economic crisis, precipitated by softening oil prices at a time of massive government financial commitments.
The revolution merely accentuated structural problems that had been evident from 1977. There was little chance of recovery, however, as western-imposed sanctions after the November 1979 hostage crisis began to bite and the eight-year war with Iraq led to the establishment of a ‘war economy’.
In short, the Islamic Republic has had to live with sanctions all of its life, learning to adapt and to circumvent them. Yet, the argument has been made that the sanctions imposed since 2011 for its questionable nuclear-related activities have forced Tehran to the negotiating table. So what has changed? Arguably, a great deal.
Sanctions: Tehran is hurting
Sanctions are crippling the Iranian economy but internal politics still guides the leadership’s hand