Sanctions have certainly had a grave impact, but I believe it’s the way the corrupt elite have benefitted from them that has hurt ordinary people most,” Maryam Alemzadeh, an associate professor in history and politics of Iran at the University of Oxford, told Al Jazeera.
“They have created new opportunities for corruption and given rise to – sometimes nameless and faceless – moguls that have swallowed the country’s economy.”
How does this impact people?
Iran’s middle class – common people – have paid the highest price, say experts.
In a research paper published last year, Mohammad Reza Farzanegan, an economist at Germany’s Marburg University, and Nader Habibi, an economist at Brandeis University, built a “virtual Iran” using data from similar countries to illustrate the impact of the sanctions between 2012 and 2019.
They found that starting in 2012, Iran’s middle class began to shrink dramatically.
During the period, the sanctions caused an average 17 percentage points gap between the potential and actual size of Iran’s middle class.
After Trump launched his maximum pressure campaign against Iran, the middle class shrank even more dramatically. The middle class was now 28 percentage points smaller than it would have been in the absence of sanctions.
Farzanegan told Al Jazeera that sanctions are what have led to the collapse of the rial. “This decimated the purchasing power of fixed-salary earners like teachers and civil servants, many of whom fell from the middle class into the category of ‘working poor’.”
Purchasing power is the value of money, measured by the quantity of goods and services a unit of currency can buy.
“As formal businesses contracted, workers were pushed into ‘vulnerable employment’ and informal labour, characterised by lower pay and a lack of social protections,” Farzanegan added.
A research article published in 2020 shows that UN sanctions are directly associated with a marked drop in life expectancy: on average, sanctioned countries lose about 1.2 to 1.4 years, with women bearing a disproportionate share of this decline.
The impact on Iran is in keeping with the broader deadly impact of sanctions: since 1970, US and EU sanctions have killed 38 million people – equivalent to the population of Ukraine or Poland – according to research published last year.
Sanctions have disrupted medicine imports in Iran, leading to price spikes of up to 300 percent for some essential drugs such as anti-seizure medications, according to research published in 2023.
Sanctions have also taken a toll on the environment in Iran. Farzanegan explained that sanctions have hindered the adoption of cleaner fuel standards and slowed green innovation, leading to higher levels of air pollution in cities like Tehran.
“This has had a measurable negative impact on children’s cognitive abilities.”