The Revolt of the Bazaar: Will Angry Merchants Change Iran?

As the exchange rate of the rial collapsed, the center of Iran's commerce shut down in protest — and the uprising is spreading

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Iranians watch as a garbage can is set on fire near Tehran's Grand Bazaar on Oct. 3, 2012

The Grand Bazaar of Tehran was in limbo on Wednesday as the merchants who make it the “beating heart” of Iran’s economy — as it is popularly described — shouted “Allahu akbar” (God is great) and shut down their shops. The trigger was the collapse of the Iranian rial, which lost more than 30% of its value and fell to nearly 40,000 to the U.S. dollar on the open market. As that happened, text messages of unknown origin went viral asking business owners to temporarily shut down their shops all over Tehran to protest the government’s mismanagement and indifference to the currency crisis.

The day before, President Mahmoud Ahmadinejad had tried to absolve his government by defending its policies and blaming the situation on his opponents within the regime. He said he believes they have orchestrated a “psychological war” to discredit him. In a televised press conference on Tuesday, he also appealed to merchants and citizens to have patience and wait for the currency market to calm down.

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Ignoring the President’s appeal, thousands of businessmen and shoppers went chanting into the streets of central Tehran, asking the government to “let go of Syria” — a reference to the regime’s backing of Damascus — and to “think of the Iranian people instead.” Many others shouted “Ahmadi[nejad], be careful: we are people, not some fools.” Riot police cracked down on protesters using tear gas and batons, hitting and arresting demonstrators who had taken to breaking shop windows and setting garbage cans on fire.

According to the Iranian Labor News Agency, which is close to the reformist faction of the government, the merchants’ strike spread on Thursday to the jewelers’ bazaar in Isfahan, one of Iran’s most important economic poles. Tehran’s Grand Bazaar remained shut, the shopkeepers dramatically protesting in silence inside their stores. “After Wednesday’s physical confrontations with the police, we have decided to give the government the silent treatment,” says Nasser, who works in the carpet market. “We have stopped all transactions and are sitting in half-closed shops with dimmed light. I think this is a very effective method to paralyze the ill economy and make the government think of a real solution.”

The demonstrations marked the first major protest against the Iranian government since the unrest that followed the 2009 presidential election. The suppression of that so-called Green Revolution — the color associated with the opposition to Ahmadinejad — led to the imprisonment of hundreds of journalists and political activists. Dissent seemed to have been cowed — until Wednesday.

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“I am not afraid anymore. What else can [the government] do to me when I am officially going bankrupt,” says Akbar, a very upset textile-shop owner in the Grand Bazaar, while walking among protesters. “It’s a miracle that our businesses have survived under so much pressure and uncertainty. But believe me, enough is enough.”

The situation is the same for many other merchants. Importers have faced many difficulties getting products into the country; and local producers are facing a shortage of raw material. Even supermarket owners cannot stock their shelves with staples like low-fat milk and garbage bags. “I blame the government of Iran for insisting on the continuation of its useless nuclear program,” says Masoud, the owner of a small grocery shop on the corner of Ferdowsi Street, where the clashes ended in physical violence. “We don’t need nuclear power at the cost of losing our business and livelihood. Can I feed my children nuclear power? Why is the welfare of people the last thing the government thinks about?”

While national pride has encouraged some Iranians to support the government’s uranium-enrichment plans, many others fear that the tightening U.S. and E.U. sanctions on Iran will cut even deeper into the economy, paralyzing it and leading to more pressure on the middle class. “I believe the real target of the sanctions is Iran’s middle class, who are fighting a losing battle every day to make ends meet. They have been very tolerant of the government policies, but fluctuation in prices and inflation is driving them to the breaking point,” says an economist who asked to remain anonymous because of the regime’s sensitivity to any public discussion of the economy. “The merchants’ strike is a very good sign. It brings back hope and shows that the sanctions are going in the right direction towards full impact.”

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Mehr News Agency reported that the Iranian heads of syndicates have reached an agreement to end the strike on Saturday, provided that the safety of merchants is guaranteed by special police forces for as long as necessary. They reportedly blamed the current crisis on the government and have asked for immediate resolutions.

Nasser the carpet merchant and his colleagues, however, believe they have a more effective alternative. “I have lived in this country long enough to know better. The only solution to the country’s economic problems is the closure of the Grand Bazaar,” says Nasser. “The bazaar is the heart of Iran’s economy. If we stop it, it and the corpse [the government] will topple down.”

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