Iran is bracing for a tough year amid a looming confrontation with the incoming Trump administration, coupled with an unprecedented economic crisis, social unrest, and waning regional influence.
The Iranian rial plunged 40% in 2024, ending at 821,500 rials per dollar, while GDP per capita fell 45% since 2012 to $4,465.
Chronic energy mismanagement has led to power cuts, halting schools, offices, and industrial production. Factories operate at just 41% capacity, and food production is severely disrupted.
Strikes and protests highlight growing discontent:
• Tehran’s Grand Bazaar traders protested inflation.
• Oil workers at Abadan demonstrated over unpaid wages.
• Pensioners and teachers criticized delayed welfare payments.
Inflation hit 37% in November, with over 32 million Iranians living below the poverty line. Food prices have skyrocketed—meat prices quintupled, and potatoes doubled in three years.
Although Tehran has eased some restrictions, like lifting the WhatsApp ban, platforms like Instagram remain blocked.
While officials signal willingness for nuclear talks, doubts linger over Iran’s readiness to compromise as Trump faces domestic pressure to adopt a hardline stance.
Source: WSJ
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2025 will be a formative year for Iran. The potential collapse of the regime or widespread chaos in our neighbour's house raises concerns for Türkiye. While there may be some short-term advantages for us, I am inclined to think that the long-term uncertainties significantly overshadow these benefits.
