Iran is a paradox. Its government is dominated by hardline religious conservatives yet it has one of the highest female university enrolment rates in the world. It hardly counts itself as a friend of Israel, yet its Jewish population is the second largest in the region. And its latest street protests, driven by economic discontent, come as the price of its biggest export, crude oil, has surged by nearly half since the summer.
Iran’s economy, in some ways, looks better than that of its great Islamic rival Saudi Arabia. So long as sanctions — lifted in January 2016 — do not return, the economy and its government should survive the protests. That is not to say life is easy. With half the population under the age of 30, and youth unemployment estimated at 25 per cent, tensions have been long brewing. Inflation at 10 per cent no doubt hurts, though prices were climbing at a faster pace during the time of the 2009 riots.
What will bite harder are Tehran’s plans to increase taxes while also cutting subsidies on key commodities such as petrol. The government is doing this to take the pressure off its budget. Yet Iran’s fiscal deficit, according to the World Bank, is not so wide at 1.5 per cent of GDP. Compare that figure with Saudi Arabia’s, proportionally six times larger.