Iran’s coming presidential election is viewed largely through the lens of President Mahmoud Ahmadinejad’s crackdown on social freedoms and his combative approach to Israel, the US, and Iran’s nuclear programme. But there is another important issue — economy. Iran’s crippling inflation rate, unemployment, and the question of how its oil revenue is being spent top of the agenda for most voters.

The two main camps here see the issue in starkly opposed terms, with Ahmadinejad’s supporters saying his policies have improved things, while all three of his challengers in the Friday election insist that the economy is in serious trouble.

Ahmadinejad’s populist policies have enriched some segments of the population, but a longer trend of unemployment and economic stagnation is evident as well.

In his debates, Ahmadinejad has tried to project that Iran’s economy is in splendid shape. In fact, growth has slowed sharply in Iran. The IMF projects the country’s economy will expand by 3.2 per cent in 2009, down from 4.5 per cent in 2008.

During a debate on Saturday, one of Ahmadinejad’s rivals watched in disbelief as he delivered a cheerful lecture about his good economic stewardship.

“Do you think I came from the desert, and that I don’t know anything about figures?” asked Mehdi Karroubi. He went on to dispute Ahmadinejad’s numbers, including his claim that inflation was at 14 per cent, not the 23.6 per cent reported this week by Iran’s Central Bank.

Inflation is about 14 per cent when measured as the year-on-year change in prices, said Saeed Leylaz, an economist who was a minister in the Khatami Government. Inflation is far higher today than it was four years ago. In addition, unemployment is increasing fast.

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