Ahmadinejad sworn in; Critic worries about Brain Drain and Capital Flight

Mahmoud Ahmadinejad was sworn in as president of Iran on Wednesday, to scattered protests. Several hundred protesters were said to have marched around the parliament building where the ceremony took place, despite a heavy police presence. Cell phone and text messaging services are said to have been interrupted by the regime.

Ahmadinejad responded to news reports that Western European nations such as Germany and the UK would decline to send official messages of congratulation to him, saying Iran did not need their recognition.

The president is said to have boasted to fellow hard liners late last week that he would now lead a crack down against his enemies. “Now is the time to stick their heads into the ceiling,” he is alleged to have said.

More thoughtful observers are wondering what the cost of political repression will be to Iran’s development.

Mahbubeh Baba’i wrote in Mardom Salari on Tuesday (trans. USG Open Source Center) that Iran has witnessed increased capital flight and brain drain in periods of political turmoil, and that human resources have been shown to be more important to economic development than natural resources such as petroleum. She points out that in 1979-1980, capital flight reached “the unbelievable figure of more than $9.2 billion.” She said that in the wake of Khomeini’s death, from 1991 to 1994, another $7 bn. was taken out of the country. But in 1997 and 1998, in the wake of the victory of the liberal 2nd of Khordad movement of President Mohammad Khatami, the amount of capital flight fell from $536 mn. to $243 mn. She says that capital flight spiked again in 1999, as a result of the student protests that year and the brutal regime crackdown on them. She continues:

After the incident at the university dormitory, Canada announced its capacity for accepting immigrants to be 180,000 people in 1999. Meanwhile, some 220,000 Iranians applied for immigration to that country. The spectacular emigration of the scientific elite especially has become a matter of worry in recent years. It is clear that the process of the development of knowledge and technology in our country have had a share of the destructive consequences of this unpleasant phenomenon. The number of Iranian immigrants scattered across the world hasbeen estimated to be between 2 million and 7 million people.

The latest statistics by the IMF on the displacement of the elite in the world announce that, of 91 “developing” and “undeveloped”countries in the world, Iran is the first with regard to a brain drain. According to the IMF assessment, 150,000 to 180,000 knowledgeable Iranian people emigrate from Iran annually because of various reasons. . . .

According to the statistics of IMF, at present, more than 250,000 Iranian engineers and physicians and more than 170,000 highly educated Iranians are living in the United States. According to the official statistics of Islamic Republic of Iran immigration office, some 15 holders of MA degrees, two or three holders of doctoral degrees, and some 5,475 holders of BA degrees on the whole left the country in 2008. It should be noted that more than 80% of those selected by scientific Olympiads in recent years have been absorbed by foreign universities, US ones in particular.

In fact, at present more than $4.5 billion of Iranian assets in the form of specialized human resources have been transferred to the United States and another $6 billion to European countries. The total of these assets equals one-sixth of the general budget of the country and 200 millions barrels of oil. It should be stated that Iran, which exports $12 billion worth of oil every year, has become the first in the field by exporting $38 billion worth of exports of the elite. . .

[Sociologist] Ali Tayefi describes the second effective factor in the brain drain as related to scientific and educational issues, while the third factor in his opinion is the economic factor. He states: “In the scientific field, the absence of necessary research organizations to take advantage of experts’ services can be seen. In the outside world, more than 3.5% of gross national product is spent on research. This is an appropriate opportunity for an individual to work according to his or her interests and thoughts and respond to livelihood demands at the same time. However, in our country, the research budget is 0.03% of gross national product. In this atmosphere, it is natural that the job opportunity and job status of the elite, students, researchers, and scholars will be vulnerable.” ‘

I think 2009 will be a big year for capital flight and brain drain from Iran, and if the repression continues, the numbers could rise through Ahmadinejad’s 4 years in office. Much poorer Pakistan is producing scientific works that get cited by scientists world-wide in more fields than does Iran. The hard liners have no conception of how destructive for Iran’s development prospects their repressive policies really are. Iran is the world’s 17th largest country by population, and it should by all rights be among their more wealthy and advanced of such states. So far, not so much.

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