Hero of Construction: A Glance at Rafsanjani's Economic Legacy
The shock passing of Ayatollah Akbar Hashemi Rafsanjani on Monday prompted an outpouring of condolences from Iranian and foreign dignitaries who mused not just on the distinguished political career of a brilliant statesman, but also on the groundbreaking economic reforms launched during his two-term presidency, which marked the transition from a state-controlled economy to a market-based one.
Apart from his unique position as a central figure in Iran’s post-revolutionary years–lent in part by his special closeness to Imam Khomeini, the architect of the 1979 Islamic Revolution–Rafsanjani was a highly pragmatic–and in later years an increasingly reform-minded–cleric who saw economic progress and prosperity as key components of the nation’s strength and well-being.
“Hero of Construction” was the honorific epithet bestowed upon him by his supporters for the development spree he embarked on as president in postwar years.
Rafsanjani, who had seen the horrendous ravages inflicted by the eight-year war imposed by Iraq firsthand, played a key role in the country’s acceptance of the UN Security Council Resolution 598, which put an end to the brutal fighting.
In his new role as president, Rafsanjani took major steps to liberalize the economy, adopting a set of reforms that were initially criticized by those who saw economic liberalization out of step with revolutionary values.
Rafsanjani scrapped the system of rationing, which covered basic goods, fuel and home appliances, which had been put in place by successive administrations during the war. He, however, had to walk a fine line in promoting a free-market economy and protecting the rights of consumers and vulnerable groups who could be left behind in the new competitive environment. This is the area where most of his admirers and critics are split as to what extent his reforms fueled inequality or pulled people out of poverty.
Indeed, Rafsanjani had his work cut out for him but that was a near-impossible task for a country whose constitution had unequivocally espoused the merits of a state-run economy. It was only after Rafsanjani’s tenure as president had come to an end that a special interpretation of the Iranian Constitution’s Article 44 by the Leader Ayatollah Seyyed Ali Khamenei granted legitimacy to privatization.
Rafsanjani was also the force behind the establishment of offshore free economic zones in the Persian Gulf islands of Qeshm, Kish and Chabahar Port, which were intended to prepare the country for a shift from the closed wartime economic system to an open one. All of this could not have happened without the genius of a man who knew how to get things done.
On the foreign front, Rafsanjani instigated the diplomatic rapprochement with neighboring countries and regional rivals like Saudi Arabia, built amity with former Soviet states north of Iran’s border and helped expand Economic Cooperation Organization. His role in brokering the settlement of regional tensions earned him the respect of many world leaders.
The flurry of messages from public figures of various political leanings highlights the scale and reach of Rafsanjani’s career–an era that in its entirety had spanned over five decades dating back to his pre-revolution activities.
Masoud Nili, economic advisor to President Hassan Rouhani, called him an “unrepeatable man” whose brainpower, combined with an astute and ingenious mind, made him a unique decision-maker. Valiollah Seif, governor of the Central Bank of Iran, regretted the loss of someone who deserves acclaim for his role in establishing a “discourse of construction and economic development”.
Labor Minister Ali Rabiei described him as a “supporter of the poor and the underprivileged” while Oil Minister Bijan Namdar Zanganeh hoped that his “legacy” would prevail in the Islamic Republic.
Indeed, after the presidency of Mahmoud Ahmadinejad (2005-13), which saw economic policy shift toward populism, Rafsanjani’s legacy is currently guiding the Rouhani administration in many aspects–the most significant of which was the signing of the landmark nuclear deal with world powers in the summer of 2015.
Rouhani hopes to achieve economic and political progress, despite all the difficulties reminiscent of Rafsanjani’s days.