Azernews.Az

By Sara Rajabova

The U.S. Secretary of State Hillary Clinton held out the possibility on Wednesday that sanctions on Iran could be eased quickly if Tehran worked with major powers to address questions about its nuclear program, Reuters reported.

Speaking to reporters about protests in Iran triggered by the collapse of the Iranian currency, which has lost 40 percent of its value against the dollar in a week, Clinton blamed the Iranian government - rather than Western sanctions - for the financial troubles.

"They have made their own government decisions - having nothing to do with the sanctions - that have had an impact on the economic conditions inside of the country," Clinton told reporters.

"Of course the sanctions have had an impact as well, but those could be remedied in short order if the Iranian government were willing to work with the P5+1 and the rest of the international community in a sincere manner," she added, referring to a group that includes the five permanent members of the U.N. Security Council - Britain, China, France, Russia and the United States - as well as Germany.

Iranian President Mahmoud Ahmadinejad blamed the rial's slump on his enemies abroad and opponents at home, saying his government was the victim of a "psychological war". Ahmadinejad acknowledged western sanctions have contributed to the crisis.

Hundreds of demonstrators in the Iranian capital clashed with riot police on Wednesday, during protests against the crisis over the country's currency. Police used batons and teargas to try to disperse the crowds, The Guardian reported.

The day after President Ahmadinejad appealed to the market to restore calm, the Grand Bazaar - the heartbeat of Tehran's economy - went on strike, with various businesses shutting down and owners gathering in scattered groups chanting anti-government slogans in reaction to the plummeting value of the rial, which has hit an all-time low this week.

"Ahmadinejad the traitor ... leave politics," shouted some protesters, according to witnesses, the Guardian reported. Other slogans were "Leave Syria alone, instead think of us," opposition website Kaleme.com reported.

Iran's alleged financial and military support for the regime of Bashar al-Assad appears to have infuriated protesters in the wake of the country's worst financial crisis since the Iran-Iraq war in the 1980s.

The devaluation of the rial and soaring prices of staple goods are the latest signs that western sanctions - targeting the regime's nuclear programme - and government mismanagement are compounding the country's economic woes.

On Wednesday, many foreign exchange dealers and bureaux across the country refused to trade dollars and some currency-monitoring websites refused to announce exchange rates.

Some Iranians expressed anger on social networking websites over the national TV blackout of the protests, saying it discussed the European financial crisis with little if any coverage of Tehran's unrest. The authorities were also reported to have jammed signals of the BBC's Persian service as the protest unfolded.

The government has failed to bring the rial under control despite several attempts. It has lost 57% of its value in the past three months and 75% in comparison with the end of last year. The dollar is now three times stronger than early last year. The economy minister of Iran, Shamseddin Hosseini, said the government planned to "gather up" the unofficial currency market in the latest desperate ditch to curb the crisis.

Iran's supreme leader, Ayatollah Ali Khamenei, speaking to elites on Wednesday, said the country was under pressure because "it did not yield to the demands of tyrannies".