In early October, the Iranian-American policy analyst and scholar Afshin Molavi published a piece called “Iran Missed the Real Revolution” in the digital magazine of the New America Foundation, a nonpartisan think tank based in Washington, D.C. The piece argues that while Iran was busy building and exporting its Islamic Revolution in the 1980s and 1990s, it missed the surge in economic growth that propelled countries like Turkey and Indonesia into the rank of the world's richest nations. The process through which these once fledgling economies joined Western powers and the United States at the forefront of the global economy is called the emerging markets revolution, and Molavi incisively demonstrates how Iran, despite its vast physical resources and skilled population, not only missed out on such growth but has fallen dramatically behind. The piece has generated extraordinary interest among the Iranian diaspora and also within Iran itself. What follows is a three part series in which Molavi discusses the genesis of his piece and the reactions he has received, and further explores some of its key themes.
As someone who has followed Afshin's work and writing on Iran for years I found his piece not only rich in global perspective, economic insight, and telling anecdote, but also profoundly moving. It is both a story of lost opportunities and a reminder that as Iranians, whether inside or abroad, our understanding of Iran should always bear in mind Iran's true potential. That we should not be trapped into the poverty of low expectations. I asked Afshin – who I have known for years and who graciously spent a great deal of time sharing his thoughts with me – to begin by describing how he originally conceived of his piece. What follows is his extended reply.
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There are two answers to that question. The first is that the New America Foundation, which I’m still affiliated with as a fellow, asked me to write about Hassan Rouhani's visit to New York, the prospect of a nuclear deal and what all that could mean for Iran-US relations. And I thought about it and I said, that’s interesting, but many people have written about that, and there is an idea that has been circulating in my head for 15 years. The article I ended up writing has been in my mind since 1998, when I visited Iran for the very first time after having been away from the country since the revolution.
Now it had been circulating in my head for a variety of reasons. My first visit to Iran in 1998 was during the Khatami era, which was an exciting time, a time when people were hopeful for change. But even at that time, even in the middle of that euphoria, you could feel and sense the economic pain in the streets of Iran. When I spoke to people that’s what they talked about. They talked about the price of meat and onions and tomatoes. The young people talked about leaving Iran. They talked about going to America, going to Europe, getting a job somewhere. They didn’t want to leave Iran because they didn’t like Iran. In fact, they loved Iran and demonstrated the characteristic Iranian nationalism. But there were simple not enough employment opportunities. This was sad to watch, the best and the brightest lining up outside European embassies in Dubai and the Canadian embassy in Damascus, Syria, hoping for a way out.
Even at that time I started writing a little bit about the Iranian economy, but it wasn’t something I focused on entirely, I was doing more political, cultural, and society work writing for the Washington Post and doing research for my book. But this kind of issue came back to me as I talked to Iranians, as I would meet Iranians from Sharif University who are now living in Silicon Valley and doing extraordinary work. And later I would say to myself, what a pity they are not in Iran doing this extraordinary work. And then I started attending the World Economic Forum type of events, global investment conferences, and I started looking at emerging markets and what was very striking to me was the absence of Iran from the economic transformation taking place in our world, with the rise of Turkey and Malaysia, Indonesia, Mexico and even Egypt from the 2003-2008 period all these countries that were attracting foreign investment, and growing their economies at a much faster rate than Iran.
A lot of it crystalized for me in late 2006 when I attended A World Economic Forum conference in Istanbul, Turkey. The very fact that this conference was being held in Turkey was significant, because the World Economic Forum organization does not hold conferences for single countries unless they are considered important. So at this conference there were Iranian officials present, Turkish officials, Egyptian officials, officials from around the world. They were shaking hands and handing out business cards but the Iranian delegation was standing in the corner not talking to anyone. It's as if they failed entirely to understand the importance of engagement and networking or were too fearful to do it. There were these rough looking bodyguards surrounding the Iranian vice president at the time, Parviz Davudi. And I was speaking with some of the foreign ministry officials from Iran who were there in Istanbul; we had what I call an “ham dardee conversatoin.” He began quite openly complaining to me about what an embarrassment the Iranian delegation was and how he has grown to resent his visits to Turkey because he sees their progress, while Iran is falling behind. The conversation should have been startling but it wasn't. I've been there before. When you speak Persian, these kinds of conversations are normal. Iranian officials are not shy about telling you how they really feel in the quiet corner of a conference room, even if they would never say so publicly.
Anyway it had come time for the Iranian official to go on stage and he goes on stage with the Egyptian prime minister and the Turkish foreign minister at the time. And the chairman of the World Economic Forum offers opening remarks, and he tells they each have seven minutes to make a pitch. The prime minister of Egypt, Ahmed Nazif, is a former technology guy, and he starts pitching Egypt’s investment requirements and how attractive Egypt is as an investment destination. At the time, Egypt was breaking records for foreign direct investment. Abdullah Gul, the foreign minister of Turkey at the time, began his pitch by talking about Turkey’s central strategic location close to European union markets and its extraordinary economic growth, Turkey as a bridge between east and west, all the things you would say to a gathering of potential investors, bankers and business people.
When it came time for Davudi to speak, he spoke for 20 minutes about Zionism, the dangers of Zionism and you could just hear people murmuring, what’s going on? The speech was inappropriate for a World Economic Forum investment conference. Frankly inappropriate in general for a high level official. But it was also a missed opportunity in more than one way. During the Bush era, when George W. Bush was using a very aggressive language towards Iran, I always got the sense that when I attended international conferences in which Iranian officials were present, the entire group of Europeans and Asians were just waiting for Iranians to offer a sensible, rational, pragmatic pitch. George Bush towards the end of his term was one of the most detested figures in the world. And these European and Asian officials were hungry for an Iranian to show the world that the Americans are wrong. You would be amazed at how much anti-Bush and anti-America feeling percolated at high-level global conferences.
The Iranian vice-president's remarks, however, did not give the audience what they wanted. Instead, his remarks led the head of the World Economic Forum, Klaus Schwab, to take the very unusual step of standing up after the speeches were done and saying that this is not the kind of speech that one expects at the World Economic Forum and the entire room erupted in applause. It was really an embarrassing moment, and later on there was a gala dinner at the beautiful Ciragan Palace hotel in Istanbul and it is interesting that the Iranian delegation didn’t attend. The reason they didn’t come was because wine was being served. Yes, the old wine being served argument. But guess who did come to that dinner? The Saudi delegation came, and guess what they did? They just didn’t drink the wine. The Turkish delegation were of course there as hosts, and didn’t drink the wine either. Had the Iranian delegation attended, they could have at least made a note of protest, because the Turkish government who was hosting kept referring to the great Turkish poet Rumi. And my name being Molavi (the Persian name of the poet, Rumi), of course, I felt obliged to register my note of protest there that Rumi is a Persian poet who happened to live in Turkey for a while. But the Iranian delegation was nowhere to be seen, so I was on my own defending Rumi/Molavi's Persian roots!
I wrote an article about that experience in Turkey for the Columbia University Journal of International Affairs, entitled, “The Iranian Spectacle: An Istanbul Dispatch, here's an excerpt from that article and link here:
The Iranian delegation entered the conference with a thud. Parviz Davudi, the first vice-president of the Islamic Republic of Iran—flanked by several burly, bearded bodyguards and surrounded by a coterie of Iranian diplomats in Nehru collars, camera-wielding journalists from the Islamic Republic’s state news media and a few assorted hangers-on—plowed through the ornate Ciragan Palace Hotel lobby in Istanbul, brusquely pushing past the assembled political, business and media elite who gathered for the November 2006 World Economic Forum—an annual event that showcases Turkey’s economic achievements to the “Davos crowd.”
Coffee-sipping delegates looked on with what seemed like a touch of wonder and dash of fear. One of the Iranian bodyguards elbowed his way past a small group of chatting participants, spilling coffee on a Swiss delegate. A Turkish journalist nearly fell over to avoid a crash with another bodyguard. A Lebanese businessman joked: “The Iranians, it seems, have once again sent ‘the dream team.’” A British banker chuckled. The Swiss scurried to the bathroom to clean his shirt, tsk-tsking on the way.
It was an inauspicious beginning to what proved to be an even more inauspi- cious afternoon. On stage with Ahmad Nazif, the prime minister of Egypt and Abdullah Gul, the foreign minister of Turkey, Parviz Davudi threw a few elbows him- self and, as one red-faced Iranian member of the delegation whispered to me later, “embarrassed us all.”
I'll give you another example that I've seen repeated over and over again, from the World Economic Forum in Davos in 2005. That year, still during the Bush era when there was a real undercurrent of European hatred toward President Bush, and the Iranian official who attended, the vice president for environmental affairs, Masoumeh Ebtekar, who also happened to be a woman, had this remarkable opportunity. As an Iranian, as a woman, to give the other side of the story to the George Bush narrative. Nobody in the audience knew who she was; the infamous “Mary” from the Iran hostage crisis days who spoke good English and regularly berated the Western media. To this day, many of the US hostages, who advocate for better ties with Iran, still get angry when you ask them about “Mary.”
And what did she do? She told the story of how Iranian and Muslim women are superior to Western women; it was very offensive to the women in the audience, and it was again a missed opportunity. So here are Iranian officials on the world’s stage given opportunities to tell their stories and yet they fail. And this partly explains why Iran is not part of that emerging market, growth market debate. Officials have been too busy spouting slogans about threats, real or imagined, and failing to do the things one must to do attract investment and tell their economy story.
Now, what has all this wrought? If you look at global index, of doing business, or foreign investment, or world competitiveness, Iran consistently (and sadly, I might add) ranks very low, often among the worst in the world. I’m going to give you a few examples of where Iran stands in terms of those indexes. The Global Innovation Index is put out by the Swiss Economic Institute, if you look at Iran in that index, Iran ranks in number 168, according to this index it’s below Tajikistan, Bangladesh, Rwanda, Madagascar, Angola, Yemen and it’s roughly in the same category as Tanzania and Sierra Leone. Nothing against those countries, but this is not the company that Iran should be keeping, given its enormous reservoir of technology talent.
If you look at the IFC Doing Business index, which is a measure of how easy it is to do business in a particular country, Iran ranks at number 145 which is worse than Sudan, Tajikistan, Sierra Leone, Ecuador, even worse than the West Bank and Gaza and just ahead of Mozambique and Gambia. These are all economies doing poorly. When you look at the Gender Inequality Index of the United Nations Human Development Index, Iran is 107, it’s worse than Guyana and Botswana. When you look at the World Economic Forum Competitiveness Report, Iran is number 82, which brings it lower than Armenia, Slovak Republic, Croatia, and I can go on and on. By the way, in virtually all of these reports, Iran's Persian Gulf Arab neighbours rank much higher than Iran. Let me give you a couple more. On the World Economic Forum Global Enabling Trade report, Iran is 117 behind Pakistan, Benin, Mongolia, Tajikistan, Bangladesh, Syria, Ethiopia and on and on. According to the World Economic Forum Global Gender Gap report Iran is near the bottom of the list at number 127 out of 135 countries just above Saudi Arabia, Syria, Pakistan and Yemen.
If you really dive into the numbers and the indexes, it makes for depressing reading. I say “depressing” because I suspect you have the same affliction that I have, the affliction of falling in love with the Iranian people. For one reason or another, during my travels through Iran, I just fell in love with the Iranian people. I’m not alone, of course. Many people do. There is a long history of Western travellers who fall in love with the people and culture. Not many fall in love with the politics. And so when I see these things, when I see this economic transformation in Mexico and Indonesia and even in Egypt from 2003-2008 period and in Brazil and India, when I see Iran not attending functions because wine is served while Saudi Arabia is attending, and I see Iran not participating in the emerging markets revolution, when I see Iran at the bottom of all these global indexes, it pains me because of this love I have for the Iranian people that was engendered through all my travels, and I want them to be given better opportunities. It also bothers me when I hear people say, ‘it’s not so bad, the status quo is not so bad. At least we are not this, or at least we are not that.'
When I hear that, I see that as the soft bigotry of low expectations. Edward Said obviously wrote a wonderful book, ‘Orientalism,’ and one of the central themes was that people in the Middle East are viewed by westerners as being in a static state, that they are not dynamic, they are not moving forward. In many ways the apologists of the Islamic Republic of Iran are neo-Orientalists, when they're saying 'it’s not so bad in Iran, there's no need worry.' What I’m saying is actually, if you love the Iranian people, if you have a sense of nationalism for Iran, you would say no, it’s not okay because I know that Iranian people can do better. I know that if the Iranian people are given opportunities, if they are not isolated internationally, if they are not sanctioned the way they are, then I think that Iran can easily become the next big emerging market star. It could become a major investment destination. Iran could become a global ten economy. I have no doubt about this. And then the argument comes back ‘well the world is against them, there are sanctions on them, etc.’ To some extent, yes, sanctions are hurting Iran, there's no doubt about that. And I hate to see the middle class being squeezed the way they are because that middle class is Iran’s future.
But these are also geopolitical choices that the Islamic Republic of Iran has made from the very beginning of the revolution. If you talk to someone like Bruce Laingen, who was charge d'affaires of the US embassy in Tehran in 1979 when hostages were taken. He will tell you, as will other American diplomat/ hostages including the great Persianist John Limbert on, will tell you that after the revolution the Americans were ready to deal with this new government in Iran. Because Americans engage in real policy. The Shah was an ally certainly, but he was gone, and they were ready to deal with whoever was in government. It didn’t matter.
This was a geopolitical decision that the revolutionaries made in Iran. When the Ayatollah Khomeini came forward with this idea of neither east nor west, anti-Americanism was solidified as an important part of the revolution and this was a geopolitical decision that the revolutionaries made in Iran. Well 32 years later you have to understand that when you make these geopolitical decisions, when you fight big powers, big powers are going to confront you back and you better be prepared for some of the pains that those big powers want to inflict on you because they are certainly capable of doing so. This is not an issue of justice or right and wrong, this is amoral national interest geopolitics and Iranians, the Islamic Republic of Iran, understand that. Turkey has strong relations with the U.S. but no one would call Turkey a servant of the U.S. American diplomats who have served in Saudi Arabia will certainly tell you that the Saudis are not shy about defying U.S. interests when they deem it necessary. Same goes for Pakistan, another U.S. ally, who is no servant of the U.S. This idea that countries can all have a Master-Servant relationship with the U.S. needs to stay in the minds of conspiracy-minded dayejan Napoleons, but not among statesmen.
Do I think sanctions are hurting ordinary middle class Iranians too much? Yes I do. Do I condone those kind of sanctions? No I don’t. But I also simply say that this is something that the Islamic Republic in some respect bring on themselves. Statecraft is about compromise and seeking the best deal for your people and Iran’s leaders have not done that.
And in fact the Iranian people understand this as well. If they wanted this continual defiance, rejection and isolation, they had the candidate in Saeed Jalili, who they could have voted for. But they voted for Hassan Rouhani.
So this is a very long answer to your simple question and I apologize for giving you “sar-dard” but in one way or another this article has been circulating in my mind for 15 years, and it came from an emotional place, because I want Iran to do better. I want to read headlines that say 'Iran Rising,' and I want to see this headline because Iran is rising because of its economy. Not rising because of its support for Hezbollah and Hamas or because it challenged the United States in Iraq or Afghanistan. So when I wrote this article it was something of a lament, and the clear point I was making is that it would have been great if Iran had participated in the emerging market revolution.
The reaction I've received has been really striking. I’ve gotten more positive emails on this article than any article I’ve ever written on Iran. And the reason is most Iranians saw this as a lament, they really felt pained by the situation and understand that Iranians are better than this, that they can do better, and that they have been held back by a government that has not been geopolitically flexible, has not managed its economy well, and has engaged in widespread corruption and mismanagement. And all I want to see is the Iranian people unleashed because when they are unleashed, watch out Turkey, watch out Mexico, watch out Indonesia, watch out all these big emerging market stars. Because Iran has all these elements to be a major emerging markets star, and in fact to become a major advanced economy, I believe. It has the world’s largest gas reserves, and yet Iran is a net importer of gas. It has the world’s third largest oil reserves, and yet Iran’s oil production is declining. And all these things play into it.
Let me just make one more point. There is this narrative of 'een akhoonhda chegadr ballan,'
'look at how clever these mullahs are.' But how clever is to put yourself into this kind of box? With the world passing you by. If you look at the BBC's world survey of countries, which surveys how countries are viewed, the BBC asks about 6,000 people from around the world what they think of various countries. Iran was dead last. Yes, dead last. And lest someone watching from the Islamic Republic of Iran call this a Zionist plot, Israel was pretty low on that list as well. So, when your country is dead last in terms of its perception worldwide among ordinary people and it is near the bottom of all of these global indexes, far behind many of its neighbours, you are doing something wrong.
When you look at this and you look at the oil reserves, look at the gas reserves, and you look at the talent of the Iranian population, what Iranians have done in America, in places where they have been given these kind of opportunities. And then you look at Iran’s so called allies: Russia, India, China etc. All of these allies are feeding off of the Iranian carcass. This is what everyone is missing. Many analysts are just lazy. They call China an ‘ally” of Iran or Russia an “ally” of Iran or India an “ally.” With friends like these, who needs enemies? Take a look at what they are doing. India is benefiting from Iran’s sanctions. Why? Because Iran has to pay for all of its oil in rupees and cannot then get those rupees transferred into euros or dollars. It’s a good deal for India, because otherwise Iran would not be importing inferior Indian goods, which they are forced to do with all those rupees in bank accounts in India. What’s more, Iran offers discounts on oil to Indian refiners to entice them to buy. China benefits, why? Because Iran has to buy its oil in renminbi and is then forced to buy overpriced Chinese subway cars and other industrial goods at noncompetitive rates. so, China wins and Iran loses. Russia, Iran’s so called ally, benefits immensely because Iran has effectively been shut out of the natural gas market. Iran could potentially be a major supplier to Europe but is not a major supplier to Europe mainly because of sanctions. Thus, Russia does not have to worry about Iranian competition. Believe this: Russia does not – I repeat not – want Iranian gas to enter global markets in a meaningful way. This is an ally? Iraq, Iran’s ally, is effectively backdealing off lost Iranians oil sales to China, India and other Asian customers. Qatar, who has generally had a better relationship with Iran than with some other states, also benefits from Iran’s lack of participation in global natural gas markets. Yes, Qatar might be nicer to Iran than other GCC states in public, but it too benefits from sanctions. So this idea that somehow only the West is benefiting from these sanctions on Iran is wrong. You know who is benefiting? Many of Iran’s so called allies. They are all feeding off of the Iranian oil and gas carcass.
So you add all these things together, you see a population that is not able to achieve its full potential, you see an isolated state, a state that is at the bottom of these globalisation lists and these global indexes, and if you care about the Iranian people and you want them to do better, these things all converge. These were all of the things that were going through my mind as I wrote this article. I wrote this article while I was sitting in Florence, Italy, where I happened to be at a conference where I was speaking about emerging markets, I had a talk called ‘Shanghai, Mumbai, Dubai OR Goodbye’ and I was late for my deadline so I sat down and in three or four hours I banged out the piece.
I was also delighted to read the article recently by Mohammad Jahan Parvar on the ‘opportunity cost’ of Iran’s foreign policies. It really laid out a strong case on solid empirical economic grounds for what I have been thinking about, so I thought this entire combination worked toward me writing the piece.
The piece might have benefited from a more careful consideration but there was emotion in that piece I was writing and I think the reaction I got was a real connection with many Iranians who felt the same way. Let me just share with you one email I got. There was a young Iranian businessman who was starting out, who recently moved to Dubai, and he wrote to me saying “Why should I move to Dubai? I wish I could stay in Iran. I’m tired of seeing Turkey rise, I’m tired of seeing Tajikistan rise, Azerbaijan rise and other countries rise, why can’t Iran rise?”
It did seem to hit a nerve, that article. So it was a culmination of 15 years of thinking, and love for the Iranian people, this conviction that Iranians deserve better, and the frustration I have with those who say ‘no, everything is just fine’. I think those who say that are engaging in a kind of new Orientalism, as I said before. Because how can you look at those numbers and how can you look at the Iranian people – This tremendously talented population --, and how can you look at the potential of this nation and say that everything is fine? You know who said that everything is not fine? Hassan Rouhani. Hassan Rouhani would not say that everything is just fine. And when you have officials who say that not everything is just fine and then you have someone outside of Iran who says ‘No, no, it’s fine don’t worry about it.’ Then I think you've got a real problem there.
Again, sorry for the sar-dard long answer. How long have I been speaking? I think my phone will die soon..
Afshin's phone died at this point in the conversation, and we resumed speaking a while later. That further conversation follows in a separate piece.
To Be a Contemporary Iranian in the World: Afshin Molavi in Conversation (Part 1)
To Be a Contemporary Iranian in the World: Afshin Molavi in Conversation (Part 2)
Iran Missed the Real Revolution
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