Economic Foundations of Protests in Khuzestan

Demonstrations and protests against water scarcity in various cities of Khuzestan continue, and understanding these protests is possible by examining the most important characteristics and economic and social constraints of Khuzestan Province.

Demonstrations and protests against water scarcity in various cities of Khuzestan continue, and understanding these protests is possible by examining the most important characteristics and economic and social constraints of Khuzestan Province.

Khuzestan, despite having numerous rivers, has been one of the most water-rich provinces in the country. At the same time, the agricultural, horticultural, and livestock sectors of this province are dependent on water access.

Therefore, the constraint on water access severely impacts the economy of this region of the country and, combined with the constraints of its damaged economy, quickly transforms into an economic crisis.

Some of the Most Important Economic Characteristics and Constraints of Khuzestan

According to the latest statistics released by the Statistical Center, Khuzestan had a population of over 4 million and 800 thousand people in 1398 (2019-2020), ranking fifth in the country’s population. Based on the same statistics, Khuzestan Province, after Tehran Province, with over 14 percent, ranked second in gross domestic product production. The bulk of this added value is based on oil industry production.

Khuzestan’s statistics regarding population and share in gross domestic product must be considered alongside the low labor force participation rate (the percentage of citizens participating in the labor market and job search) of this province at 40 percent, ranking 18th in the country.

Unemployment among the population aged 15 to 24 in this province exceeds 33 percent, and the overall unemployment rate in this province, according to some officials, is over 25 percent. In confirmation of this, Habib Agha-jeri, representative of Mahshahr, recently stated that despite the large industries in this region: “The unemployment rate in this region is about 25 percent.” He also mentioned the water crisis and marginalization as other problems in the region.

The failure to employ local labor in provincial projects has also been cited as one of the reasons for this high unemployment rate. Consequently, despite the increasing number of university graduates, the labor market of the province does not have the capacity to absorb them.

In this regard, over 26 percent of households in this province are defined as below-poverty-line households. Also, the business ranking of this province is 19, which does not have much compatibility with this province’s gross domestic product ranking in the overall country.

According to a report from the Ministry of Welfare, Labor, and Cooperation titled “A Glance at the Development Indicators of Khuzestan Province (First Edition),” the most important constraints of the province are: widespread poverty and marginalization and also the second rank in marginalization in the country. Furthermore, a large number of unsupervised and poorly supervised families and child marriage are among the other problems of this province.

Based on the announcement of the Ministry of Welfare, Labor, and Cooperation in the aforementioned report, in terms of social constraints, Khuzestan has theft rates higher than the national average and is also the third province in terms of addiction growth. Additionally, the homicide rate in the province exceeds the national average.

The low women’s employment rate (national ranking 24) and low health service indicators compared to the entire country are among the other constraints of this province. Overall, this difficult situation has caused Khuzestan to lose the ability to attract migrants and become a province that sends out migrants.

Rentier Government: Distribution of Resources Based on Proximity to the Top of the Ruling Hierarchy

The water crisis in Khuzestan is not a new constraint and, despite the promises of officials and the political and security dangers related to water for the government, this problem still persists. In an economy based on the distribution of privileges among power factions and rent-seeking and rent-distribution, long-term economic priorities and growth capacity do not determine resource distribution.

Therefore, public goods such as water, security, education, and training are also drawn into the rent and privilege distribution cycle and are converted into rent in a sense. This is why proximity to power centers and factions, and especially to the person and team of the government’s leadership, is what determines resource distribution. As in the conflicts between the government and parliament, ultimately these interests belonging to power factions at the top of the ruling structure shape the budget structure.

Therefore, areas that are not geographically, politically, ethnically, or rent-distribution-wise close to these centers do not benefit much from economic, political, and dignitary resources. Thus, it can be said that Khuzestan, despite ranking second in the country’s gross domestic product production, is not a priority from the government’s perspective in terms of resource distribution.

Although the government and parliament claim immediate and decisive management of Khuzestan’s water crisis, overcoming the water crisis constraint requires access to time and long-term time at that, economic resources including appropriations and investments, as well as transparency, accountability, and organizational efficiency and management, none of which are currently effectively at the government’s disposal.

Implementing urgent and decisive plans to solve the accumulated problems of this province, which are intertwined with its economic structure, is nothing but waste of resources and temporary concealment of crises in current conditions and their transfer to the future. Crisis management passes through the path of fundamental solution to crises that are structural and institutionalized and requires structural transformation in the economic sphere and of course the political sphere.

Source: Radio Farda