May 5, 2017 / 12:13 PM / in 7 months

Hardline foes of Iran's Rouhani rap lack of payoff from nuclear deal

ANKARA (Reuters) - Hardline rivals challenged President Hassan Rouhani in a pre-election debate on Friday over the lack of economic revival since his nuclear deal with big powers, but he said oil exports had resurged and the economy only needed more time to recover.

FILE PHOTO: Iranian President Hassan Rouhani takes part in a news conference near the United Nations General Assembly in the Manhattan borough of New York, U.S., September 22, 2016. REUTERS/Lucas Jackson/File Photo

Rouhani was elected by a landslide in 2013 on pledges to end Iran’s international isolation that had crippled the economy and to ease restraints on society in the Islamic Republic. He seeks re-election on May 19 against hardline rivals, though even supporters voice disappointment at his performance in office.

In a debate in Tehran carried live on state TV, Rouhani battled criticism that few Iranians had enjoyed any tangible benefits from the 2015 deal under which Iran curbed its disputed nuclear activity in exchange for relief from global sanctions.

“What has changed since the deal? What has changed in the day to day lives of our people?” said hardline candidate Ebrahim Raisi, one of four sharia (Islamic law) judges who oversaw executions of thousands of political prisoners in the 1980s.

However, all of Rouhani’s opponents in the debate said they accepted the nuclear pact as “it was a national accord”.

Another conservative candidate, Tehran Mayor Mohammad Baqer Qalibaf, also a former commander in Iran’s elite Revolutionary Guards (IRGC), accused Rouhani of failing to tackle unemployment estimated at 12-20 percent.

In response, Rouhani said Iran’s reconnection with the global financial system after most sanctions were lifted had already borne fruit in renewed oil exports and was sure to yield jobs and investment boosting the economy in coming years.

“All the nuclear-related sanctions have been lifted. Today, we export 2 million barrels oil per day. Without the deal it would be reduced to 200,000 bpd,” said Rouhani.

Rouhani accused unnamed hardliners of trying to derail the nuclear deal, reffering to a ballistic missile launch in 2016 by the IRGC in which “Israel must be wiped out” was written on the missiles, according to Iranian media.

Iran’s overall economic outlook has improved since the nuclear accord. The International Monetary Fund (IMF) predicts between 4 and 5.5 percent growth in 2016, well up from the 1.3 percent it forecast before the deal was clinched.

Raisi and Qalibaf have vowed to created millions of jobs a year, if elected, though they have not said how they would do so and economists have called such promises “unrealistic”.

“CHOOSE BETWEEN SLOGANS AND ACTION”

“These campaign promises are just slogans,” Rouhani responded. “You cannot reach 26 percent growth in a year ... you need investment for economic progress and creation of jobs,” he added, and this would come in part through his policy of opening the Islamic Republic to foreign investment.

“Do not lie to people. People will have to choose between slogans and action,” he said.

Clerical Supreme Leader Ayatollah Ali Khamenei, a hardliner who holds ultimate authority on matters of state in Iran, guardedly endorsed the nuclear accord but has said Rouhani’s economic follow-through has fallen short.

Analysts say many foreign firms remain hesitant to invest in Iran for reasons including lingering unilateral U.S. sanctions imposed over human rights violations and alleged Iranian links to terrorism, and the dominating role of clerical and security institutions in the Middle East’s second largest economy.

International rights groups and activists in Iran say Rouhani has done little to bring about greater social freedoms. Dozens of activists, journalists, bloggers and artists have been jailed by a hardline judiciary beyond Rouhani’s control.

But first Vice President Eshagh Jahangiri, who is also running for election but will campaign alongside Rouhani, warned of a return to outright authoritarianism in Iran and isolation abroad if a hardline candidate was elected in May.

“Dear people of Iran, what do you want? Do you want limitations or more freedom? Do you want international tension or peace? Isolation or integrity? By casting your vote you will determine Iran’s path,” Jahangiri said.

Despite his vulnerability on the economy, analysts say Rouhani retains a strong chance of re-election as he is the only candidate supported by a pro-reform camp while hardliners have failed to unite behind one candidate.

Other candidates are ex-conservative culture minister Mostafa Mirsalim and moderate ex-vice president Mostafa Hashemitaba.

Editing by Mark Heinrich

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