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The word war with Trump is the least worry for the Iranians




Less than a year ago, Amir was at a soiree at the Brazilian embassy in Tehran, exchanging business cards with shoemakers eagerly selling to a market of 80 million Iranians

The product of the smirk in the evening still lines the walls of its shops: Brazilian flip-flops and slippers. But now the shoes are under government bans on foreign imports as Iran seeks to stifle the effects of President Donald Trump's exit from the nuclear deal that opened the door to new suppliers.

"Many traders are already closed and I am selling the stock I still have," said Amir, 27, who was standing behind the cash register in his small shop in a shopping mall in a prosperous area in northern Tehran. "As soon as I sell everything, I'll probably be out of work," he said, not wanting to give his full name because he had reservations about talking to foreign media.


The fiery exchange between Trump and President Hassan Rouhani has fueled fears among Iranians that things will only get worse.


Since Trump brought the US out of the agreement in May, the Iranian currency has reached record lows on the black market, and foreign companies, including Peugeot's parent PSA Group and Total, have cut back their operations. What remains are the deep structural weaknesses in the Iranian economy, which have been exacerbated over the decades by embargoes, corruption and nepotism. The banks are paralyzed by bad loans due to years of bad regulation.

Sanctions lifted under the Nuclear Agreement will return within days, while Trump warned Rohani not to threaten the US or to bear the consequences. Record temperatures have meanwhile led to power outages in cities and water shortages, which have sparked protests. The Iranians say they are worried that the government is overwhelmed by the scale of events.

"Rohani's government has no real understanding of what will happen and what will happen to those sanctions," said Saeed Laylaz. Reform economist who has advised the government. "People have lost their confidence and they demand efficiency – they do not care if it comes from men with beards or ties."

Instead, the leadership is trying to get things under control, he said. "The strategy is firefighting," said Laylaz. "They are dealing with crises."

There is little evidence that Rohani's position is seriously threatened, but the rapid deterioration of people's prospects would make any leader vulnerable, let alone those in which Islamic conservatives exercise such power. The cleric spent just over a year in his second term, trying to forge unity with hardliners who always opposed the nuclear agreement.

However, many Iranians accuse US foreign policy of deliberately destructive and ridiculous of Trump's declared goal of helping Iran over the longer term by bringing the country back to the negotiating table. They see themselves as collateral damage in a geopolitical chicken game.

"If you do everything you can to destroy the economy, how does that help us?" said Parisa, 32, who runs a women's fitness center she opened last October with a friend. "I think people feel trapped between Trump's policy and the way the leaders act here."

The frustration with the government, especially among the reformists who voted for Rohani, is growing. Some legislators are talking about a new generation of Iranians who were inducted into wartime food coupons and rations that shaped life during the conflict with Iraq in the 1980s

Parisa, who voted for Rohani, said she has shelved plans to expand her business because of the collapsing currency. Most of the material she needs, such as weights and yoga mats, is imported, she said, declining to be identified by her full name.

Aliasghar Rezaei is another who wants to pursue a different course for Iran. Under the boiling heat of Tehran, he steers his sluggish Iranian-produced Peugeot 406 through city traffic. Rezaei has been operating a textile factory for 35 years. He closed it a year ago and started working for an app.

"In general there is no hope, and it feels like we're at the bottom of the line," said Rezaei, 58, who supported the Shah's overthrow in 1979. "I fought for the revolution and I would probably still, but something has to change."

The government has tried to restore order in the economy and to show that it has control.

Rouhani unmasked some of the illegal practices importers and dissolved a number of government-affiliated networks that had controlled car imports for profit. Several officials from the Ministry of Industry, Trade and Mining were arrested last week. Rouhani has instructed his deputies to accelerate efforts to combat bribery and is expected to shake up his cabinet.

After the sharp drop in rialling, as Iranians demanded hard currency – the euro is 100,000 riyals in uncontrolled markets, according to Tasnim news agency Compared to about 40,000 rials last year, the government tried to stop panic buying. It fixed a fixed price for the dollar, limited foreign exchange sales to travelers and closed foreign exchange transactions.

But policy was thrown back because some companies took advantage of the difference between the central bank's fixed interest rate and the illegal black market while others perished

Seyyed Ali Jafari returned in 2014 one year after the election of Rohani from the United Arab Emirates back to Iran. The prospect of sanctions and rapprochement with the West opened the opportunity to build an Internet business and target foreign companies seeking to advertise online in Iran.

Four years later, Jafari and his business partner are now considering applying for visas and leaving the country after their customer base has been decimated, especially since Trump tore US involvement in the nuclear deal. They lost the data center that hosted their server because they can not afford the operator and try to serve a small group of domestic customers, Jafari said.

"Our goals for revenue and page impressions and for profit foreign customers have all fallen apart," Jafari said. "The situation for our company has deteriorated significantly since May, and the currency issues, the total lack of access to dollars and foreign exchange mean that we can not find any on the market, we have lost foreign customers and suppliers."

Tight controls on dollar and euro delivery and the ban on overseas purchases of unnecessary raw materials are causing many suppliers and retailers to struggle for survival.

The shoe retailer Amir has run the family business with three shops in the Iranian capital since he was a teenager. He said he could not remember a time when things would have felt more precarious and insecure. A shipment of shoes was blocked by Iranian customs a month ago and stuck there, he said.

"The whole country is in a state of stress," he said. "It's as if everything is standing still."


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