Tehran Merchants Face Bankruptcy as Wartime Crisis Crushes Demand

TEHRAN: In a bazaar where fragrant herbs and spices tempt customers, shopkeeper Nasir recalls when locals purchased his nuts by the kilogram. Yet soaring prices driven by the war between the United States and Iran have decimated sales, leaving merchants fighting merely to survive.

Once abuzz with shoppers, the marketplace in the Iranian capital’s north is now mostly empty, with only a handful of people traversing its narrow, historic paths. It is a stark contrast for the sellers who shout to promote their wares.

“There used to be customers who bought two to five kilograms. Now, they’re down to buying one kilogram or half a kilogram,” said the 61-year-old.

“Prices are truly high. We all know it, and it would be a lie to say otherwise.”

Nasir called for authorities to stabilize the currency so businesses could plan ahead.

“We’re left in limbo, everyone is,” the fruit and nut seller said. “They need to stabilize the dollar exchange rate.”

Iran’s economy has suffered under years of sanctions, but the conflict that began in February, marked by US-Israeli attacks and an American blockade of the nation’s ports, has added severe strain to daily life.

Rising inflation, which reached nearly 90 percent year-on-year in September according to official figures, alongside erratic currency fluctuations, has pushed up the cost of daily necessities. Food prices have more than doubled since last year.

At the bazaar, a historic covered market in Tehran’s Tajrish square, locals surrounded by Iranian flags and Persian signage browse sweets, jewelry, traditional garments and cuts of meat ahead of the weekend, attempting to ignore the economic gloom.

In an alley nearby, a street artist plays a guitar while another drums his hands on a box, hoping to draw tips from passersby.

Just need stability

Across the commercial district, however, many see little future for their businesses.

“It is a desperate, last-ditch struggle. Manufacturers are going bankrupt, laying off staff and closing shops, and the impact inevitably reaches us,” said Ali Nowruzi, 36, who runs a sportswear shop in the bazaar.

Nowruzi now orders only a few items for display, lest his shelves look as bare as his warehouse, which he says sits empty due to a lack of demand.

“We have absolutely no plan for the future. When people don’t come to buy… it effectively spells bankruptcy for the business,” he said, citing rising rent and utility bills.

“We just need some stability.”

Many shoppers, whose purchasing power has weakened since the war broke out, are seen leaving the bazaar without making a purchase.

Azadeh, a 45-year-old woman currently out of work, says she visits simply to “watch the shops.”

Mounting pressure from the war saw Iran’s GDP contract 10.1 percent year-on-year between late March and late June, according to official figures.

On the unofficial market, the rial traded at around 2.7 million to the dollar in the past week, compared with approximately 1.7 million before the war.

The minimum monthly wage, which stood at around $120 a year ago, has fallen to $65.

Meanwhile, the country’s economy minister has dismissed predictions of an imminent collapse, accusing Iran’s foes of trying to fuel public anxiety and drive up exchange rates.

Prices skyrocketed

Azadeh offers a price comparison of a kitchen cloth she purchased several months ago for 22 cents. She says the item now costs $1.10, five times more.

“It shows that prices haven’t just gone up — they’ve truly skyrocketed,” she said.

She has stopped buying certain fruits and says she can no longer afford holidays.

“We aren’t meant to just exist, we’re meant to actually live, right?” she asked.

Car mechanic Mojtaba Rezaei says his customers have “dropped to a tenth of what it was” because “goods now cost two or three times as much.”

“I actually feel embarrassed telling prices to customers. People just come in, ask the price, and leave,” the 57-year-old told AFP at the bazaar.

“So many things — buying clothes, going out for leisure, dining at restaurants — have all been cut out of our lives.”

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