TEHRAN: With protests appearing to die down in Iran, analysts say President Hassan Rouhani faces both challenges and opportunities in his efforts to reform the country.

The leadership closed ranks as the past week’s unrest turned deadly, blaming foreign enemies and “terrorist” exile groups.

But all sides of the political spectrum accept that deep undercurrents of frustration driven by unemployment, high living costs and perceived corruption have turned Iran into a tinderbox.

Rouhani’s critics say he has abandoned the poor by seeking to raise fuel prices in his most recent budget, announced just a few weeks before the protests began.

In his budget speech, Rouhani said price rises were necessary to tackle unemployment, but parliament looks likely to reject the most controversial measures as they seek to show they are listening to the anger on the streets.

“As concerns petrol prices, we must absolutely take into account the situation of the people because the tensions are absolutely not in the interests of the country,” parliament speaker Ali Larijani said on Wednesday.

A new online news agency appeared from nowhere this week with a slick video that quickly went viral, showing angry Tehranis criticising the government’s policies.

“Has Rouhani ever bought his own eggs, or meat?” says one man in his 40s.

“I’m protesting against the theft, the money grabbing. Who is behind it? Those who live in palaces, those with millions in their cabinet,” adds an older man.

Rouhani points to the fall in inflation -- from around 40 to 10 percent -- as a key success of his tenure since 2013, along with the huge rebound in economic growth -- 12.3 percent last year, according to the central bank -- that followed the 2015 nuclear deal that lifted many international sanctions. But much of this growth has been due to the return of oil sales that do not produce much employment.

The past week’s protests suggest many Iranians have grown tired of waiting for the results to trickle down, while unemployment remains stuck at more than 12 percent overall, and nearly 30 percent for young people.

“People have had enough, especially the young people. They have nothing to be happy about,” Sarita Mohammadi, a 35-year-old teacher in Tehran, said.

“People cannot afford to buy a house, to continue their education. They can no longer put up with the situation.”

A unique opportunity

Yet Rouhani could still pull victory from the jaws of failure, analysts say, by using this opportunity to push for a broad range of reforms.

“This is a unique opportunity for Rouhani to pivot himself away from being the demonstrators’ target to becoming their champion for reform,” said Ali Vaez, of the International Crisis Group.

Vaez says the president should try to push through major reforms of the governing structure and if they’re blocked, the public will know where to put the blame.

“There will be resistance, but Rouhani has nothing to lose. A botched second term could doom his political future , while an obstructed reform agenda could become an asset,” he added.

Rouhani’s allies have also sought to shift the blame for the past week’s unrest at the door of the conservatives, saying they stoked the initial unrest and endangered public safety.

Mohammad Sadegh Javadihesar, a reformist analyst in Mashhad where the protests began on Dec 28, claimed Rouhani’s rivals had come to the city in the days before.

“A number of well-known opponents from the (conservative) Paydari faction came to Mashhad... in order to mobilise people to come out to the streets,” he said.

“They highlighted temporary price hikes on commodities such as eggs or how the price of petrol is being increased.” He said they wanted to build up anti-government protests ahead of pre-planned rallies on Saturday, ironically to mark the defeat of the last major protest movement in 2009.

“This was their aim which got out of hand,” he said.

The conservatives have flatly denied the accusations, but the rumours alone could present an opportunity.

“I’m sure Rouhani’s government will get a degree of political capital out of this,” said Ellie Geranmayeh, Iran analyst for the European Council on Foreign Relations. “If the rumours are true and the conservatives started this, then people will see them as inept, and ask how they can possibly manage the country,” she said.

Even if he emerges politically unharmed, Rouhani still faces an angry populace and few easy solutions.

“This crisis has created a new opportunity for changes, which is necessary because otherwise the consequences could be serious,” said Abbas Abdi, a Tehran-based analyst close to the reformists.

“But it’s not like Rouhani can wave a magic wand and it will all change.”

Published in Dawn, January 5th, 2018