Sanctions Pushing Iranian Economy to Brink of Collapse

Hassan Rowhani / AP

The Iranian economy is just 18 months away from collapse according to Israeli intelligence minister Yuval Steinitz.

Steinitz, speaking at a conference Monday at the Begin-Sadat Center for Strategic Studies, said that international sanctions have effectively caused major damage to Iran’s economy.

The Jerusalem Post reports:

Steinitz, speaking at a conference at the Begin-Sadat Center for Strategic Studies, said that over the last 18-24 months the international sanctions have caused about $100 billion in damage to the country’s economy, which has an annual $450 billion GDP.

In addition, he said, inflation in Iran is currently running at 40 percent a year, and the unemployment rate is between 25 percent-30 percent, with the rate among youth at about 40 percent.

The rial, Iran’s currency, has been devalued by 180 percent, and the country has a negative economic growth of 5.4 percent.

He said that the sanctions have effectively cut Iran off from the world’s financial system, making it very difficult to do business. At this rate, he predicted the Iranian economy will collapse in another year-and-a-half, something that led to the rise of Iranian President Hassan Rowhani.

"The pressure works, it is effective," Steinitz said. "If we add to this pressure a credible military threat, the chances will be greatly improved."

Steinitz added that he believed that the same combination of a credible threat of military force and diplomacy that worked against Syria could work on Iran.

"The greater the pressure, the greater the chances for diplomacy to succeed," said Steinitz.