Iran set to go bust: President Rouhani makes desperate plea for $5billion IMF loan

And today President Hassan Rouhani pressed harder for a $5 billion emergency International Monetary Fund (IMF) loan – its first request since the overthrow of the Shah and the foundation of the Islamic Republic in 1979. While Iran has the worst reported outbreak in the Middle East with a death toll that lags only Italy, China and Spain, it is spending only a fraction of the amounts its wealthier neighbours are throwing at their economies.

But shut out of international capital markets and facing a further hit to its finances with the collapse in oil prices coming on top of US sanctions, Iran’s economy has been crippled.

Setting out his demands for funds, President Rouhani said the fund would be guilty of discrimination if it withholds the money.

President Rouhani said in a televised cabinet meeting address today: “I urge international organisations to fulfil their duties. We are a member of the IMF.


“There should be no discrimination in giving loans,” adding that such discrimination would be unacceptable.

The coronavirus outbreak has further damaged Iran’s economy, already battered by US sanctions, reimposed since 2018 when Washington exited an agreement to lift them in return for curbs to Iran’s nuclear programme.

To mitigate some of the economic pressure, Iran has delayed business taxes and loan repayments until May and said about 3 million lower-income families without permanent jobs would get handouts of up to six million rials (£324) in four stages.

But with state coffers battered by US curbs on oil sales and with other exports declining following the closure of several borders to Iranian trade because of the outbreak, Tehran’s financing options are limited.

Last month, Iran’s central bank wrote to the IMF to request the $5 billion from its Rapid Financing Initiative, an emergency programme that aids countries faced with sudden shocks such as natural disasters.

In response, an IMF official said the Fund is in dialogue with Iran, with talks aimed at understanding Iran’s needs and what is required for the loan request to be processed.

In a tweet on Sunday, the secretary of Iran’s Supreme National Security Council, Ali Shamkhani accused the US of blocking Tehran’s loan request from the IMF.

It comes as Tehran blamed America and its “maximum pressure” policy for restricting Iran’s ability to respond effectively to the virus.

President Rouhani said: “The US sanctions on Iran are economic and medical terrorism … They are in violation of international medical conventions.”

But US officials hit back saying the sanctions do not target medicine for Iran and Washington had offered to help Tehran face the outbreak.

Iran dismissed the offer as ridiculous.

Iran has banned intercity travel and shut non-essential businesses to fight an outbreak that according to official figures has killed 4,003 people and infected 67,286.

President Rouhani also said some businesses will remain closed until further notice, after the authorities announced last week that they will begin to ease a shut-down order from April 11.

But authorities said some businesses whose operations do not create a big risk of spreading the virus will be allowed to reopen from Saturday.

They have not given a detailed explanation of which businesses fall into that category.

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