TEHRAN- Danial Davoudi, an economist, in this interview explains how economic nationalism in the thought of the martyred Ayatollah Khamenei was based on people-based production, infrastructure development, core technologies, deterrent defense power, and Iran’s active positioning in the global order.
In your reading of the model of progress in the thought of the martyred leader, what exactly does economic nationalism mean, and how does it differ from classical approaches to supporting the national economy or a state-centered economy?
Economic nationalism in the thought of Ayatollah Khamenei and what was pursued during his leadership has several key components. The first component is the emphasis on the people and the private sector as the wheels of the country’s engine of progress. The second component is the development of national infrastructure as the chassis of this engine of progress. The third component is the strengthening of core technologies and knowledge-based enterprises as the motor of this engine of progress. The fourth component is the creation of defensive and security power, which acts like a protective body shielding the national economy. This fourfold framework creates a specific type of economic nationalism—one whose main focus is on internal capacity, the country’s productive and scientific potential, and independence from external pressures, and which does not rely merely on customs border controls or state ownership.
In the realm of state ownership, the Leader fundamentally believed in minimal state ownership. Regarding quasi-state ownership, or economic institutions subordinate to the Leadership and those subordinate to military bodies, he envisioned a pioneering role for them. From his perspective, these sectors should invest in areas where the private sector does not enter; but as soon as a field becomes economically viable and attractive to the private sector, these institutions must exit that field, hand it over to the private sector, and migrate to more distant and newer arenas. Therefore, in the Leader’s view, state and quasi-state ownership should not compete with the private sector. For state ownership, he truly deemed it only as necessary as required—for example, in military fields or certain specific sectors where production cannot be delegated to the private sector. For the quasi-state sector as well, he envisioned a driving role—meaning this sector must pull the economy forward, enter where there is incoordination or coordination failure, make the field economically viable, hand it over to private sector activists, and then move to further arenas.
From this perspective, in the Leader’s view, state ownership is not very prominent, yet at the same time, we are facing a national economy. In classical views of the national economy, customs borders are usually emphasized. Of course, in the literature and statements of the martyred leader, supporting domestic production through customs tariff instruments is prominent; but this instrument is merely a short-term tool for strengthening national production and bringing domestic production to a level where it can compete in global markets. For example, if at some point he supported the home appliance industry by raising import tariffs or banning imports, if in subsequent years he saw that prices had risen or quality had declined, he would caution that his support was meant for the producer to raise quality, lower prices, and conquer global markets. Therefore, his view was an export-development view, not merely import substitution. Of course, he used import substitution as a tool—a tool for strengthening domestic production and reaching the stage of export development.
In the explanation provided, I think it is clear that the martyred leader’s view of the national economy was a comprehensive one. He did not merely look at production, but also paid special attention to infrastructure, the development of knowledge and technology, and the strengthening of defensive and security power as the protective body of the national economy. Compared to other views that emphasize a national economy or a state economy, the important difference in his approach was that he opposed excessive statization and wrongful seizures, just as we saw this behavior and action from the martyred leader in the 1980s. He repeatedly emphasized that the main burden of the economy must be on the shoulders of the people and the private sector. Consequently, he viewed the state not as the owner and main player of the economy, but as a designer, rail-layer, and facilitator. The communication of the general policies of Article 44 was also for this purpose—to open the field for the private sector and the people, and to place infrastructure and security in the service of the people. Also, this economic nationalism found meaning within the framework of prioritizing East over West and Iran’s active positioning in the new global order—that is, a kind of independence-seeking coupled with outward-orientation and coalition-building, not isolation and severing ties with the world.
The martyred leader, in his conduct and statements, emphasized the connection between national production, independence, and the country’s progress. How can this connection be explained in the form of a model of progress?
In the view of the martyred leader, independence was a prerequisite for Iran’s progress. From his perspective, if a country does not have independence, it cannot achieve economic progress. Of course, there have been misunderstandings about the concept of independence in his view. Some have imagined that independence means economic isolation—that is, building a wall around the country’s borders and creating an economy within those borders that has little connection with other economies of the world. But the reality is that when we refer to the statements of the martyred leader, we see that he emphasized that independence does not mean isolation. Independence means that a country’s economy becomes so large that other countries of the world cannot overlook it in major global transactions and great economic relations, and they are forced to include that economy in the game of major economies. From this perspective, economic independence is not achieved except by strengthening national production and enlarging the economic pie. In the Second Step Declaration, we also see him emphasizing mass production. Mass and high-quality production is one of the desirable components in his view. Therefore, national production and enlarging the economic pie are tools for the economy to reach independence—independence in the sense that the country’s economy is so large that it cannot be denied or sidelined by great powers in major global equations, and it becomes a pillar in shaping the future economic order. In this sense, independence is a prerequisite for Iran’s progress. If a country does not have such independence, it essentially cannot think about economic progress and become a developed country.
It seems that all the efforts of the martyred leader and all the economic policies he envisioned were for production. He believed that national production must be strengthened, more goods and services must be produced, mass production must take place, and all his efforts were aimed at achieving greater production. But this is a general statement. To gain a more precise understanding of his intellectual system, we must look at the characteristics he enumerated for production. We must see what characteristics the production that forms the core of Ayatollah Khamenei’s economic views—and almost the ultimate goal of his economic policies—has. Of course, this economic goal has other effects as well; but if we look at the economic sphere, the ultimate goal of his economic policy was to increase production in the country. This production had characteristics. For example, it had to be knowledge-based, job-creating, and involve the general public. The production he envisioned was one where the general public would benefit from its increase and growth. He did not envision an approach that merely generates production growth in the country but whose proceeds only go to a specific segment of society. His view was not that economic growth should happen first, and then, once the economic pie grew, the poor and others would benefit from its spillover. His view was that in the process of enlarging the economic pie, we must pursue policies in such a way that the general public benefits. In fact, he did not believe in justice after growth, but rather believed in and pursued justice combined with economic growth. Production with high value-added was also a criterion for him. Production based on raw-material sales was not approved or emphasized by him. He rightly advised that instead of selling raw materials and then buying the same goods from foreign countries—after those countries had created high value-added on them and sold us a higher-quality, higher-technology product several times more expensively—we should create value-added domestically ourselves and export high-value-added goods. Therefore, his view of production had characteristics, and paying attention to those characteristics can demonstrate the desirable economic model envisioned by the martyred leader. With all these interpretations, production was the focal point of Ayatollah Khamenei’s economic views.
From your perspective, what are the most important practical components of the model of progress based on economic nationalism that can be observed in the behavior and decisions of the martyred leader, and are these components capable of being transformed into a model of economic governance?
During his tenure and leadership, the martyred leader truly provided the most important prerequisites and components for strengthening a national economy. The first axis was culture-building. When he spoke of supporting Iranian labor, supporting Iranian capital, and supporting Iranian goods, he mentioned them with pride and explained to his audience that supporting Iranian labor is valuable, supporting Iranian capital is valuable, and buying Iranian goods is a national duty. Therefore, the first axis clearly observable in his views, behaviors, and decisions is culture-building in line with constructing a national economy.
The second axis was infrastructure development. He placed special emphasis on developing infrastructure, for example, in the fields of transportation and energy. We know that a national economy does not grow, progress, or manifest itself without the necessary infrastructure in transportation and energy. For instance, at times he emphasized solar energy among renewable energies and said that the electricity imbalance could be addressed through this path. On the other hand, he also emphasized conservation—conservation that helped keep more energy available for production. In the field of transportation, he specifically emphasized the completion of north-south and east-west corridors and, for example, gave reminders about completing the Rasht-Astara project. Thus, infrastructure development was a serious concern for him. This attention was not limited to transportation and energy. For example, artificial intelligence, as an infrastructure for future production and the economy, was repeatedly emphasized by him in recent years of his blessed life, and he stressed the necessity of its growth.
The third axis was the development of knowledge and technology. On the one hand, he emphasized the development of knowledge in universities, and on the other hand, the development of knowledge-based companies, so that the knowledge existing in universities could move one step closer to industry. He also emphasized the construction and development of science and technology parks to strengthen knowledge-based companies and connect them to economic enterprises. Ultimately, he specifically advised the economic section of the Leadership’s apparatus to connect knowledge-based companies to large private sector enterprises. He also emphasized to the economic institutions under his purview that they should use small private sector enterprises in their production chains. In addition to these, the emphasis on core technologies and fundamental sciences such as nanotechnology, biotechnology, nuclear technology, satellites, and artificial intelligence was prominent in his statements. This is the third axis that the martyred leader emphasized for building a national economy.
The fourth axis was building a deterrent defensive and security power—a power built upon indigenous knowledge and used to protect infrastructure and the national economy itself against wars and direct and combined attacks. Perhaps before the 12-day war and before the 40-day war, few imagined that Iran would have a power capable of safeguarding its economy. That is, if the enemy attacks our economy and manages to strike infrastructural blows, we would also have the capability to reciprocally inflict infrastructural blows on the enemy and damage its economy, forcing it to retreat. But in these two wars, at least everyone saw what a deterrent defensive, military, and security power Ayatollah Khamenei had built in recent decades, and how important this power was for guarding and protecting the national economy.
The fifth axis was the Leader’s emphasis on positioning Iran in the new global order and prioritizing East over West in economic dealings. Contrary to the perception of some who said that his emphasis on the national economy meant closing the economy’s doors to other countries, his view was by no means such. The Leader always emphasized that Iran must have a proper position in the new global order. Given that the Western economy, especially the US economy, is declining, and economic statistics show that the future of economic power lies with Asia, he extensively emphasized the strategy of prioritizing East over West. If an economy does not properly determine its relationship with the global economy, its national economy will certainly not be strengthened either.
In addition to all of these, he placed special emphasis on popularizing the economy (the sixth axis) and making the role of the people prominent in the economy. Contrary to the perception of some who thought that if we want a strong national economy, we must strengthen state and quasi-state enterprises, the Leader stated that it is the people who must shoulder the burden of the economy. This component is important because if we want to build a national economy on state and quasi-state ownership, that national economy will practically not become a large economy; because the power of the state and quasi-state institutions never reaches the power of the people. The people, with the wealth at their disposal, with conservation, with greater investment, with their creativity, knowledge, work, and initiative, can shape a much larger economy within the country and strengthen production with greater force—much more than if we imagine the entire burden of producing goods and services rests on the state and quasi-state enterprises.
This set of components constitutes the most important elements that, in Ayatollah Khamenei’s model of progress, would build a strong national economy. These were not merely in his view, but were pursued, implemented on the ground, and brought to fruition in his decisions and behaviors over the decades of his blessed life and leadership. For example, in the first two decades of his leadership, namely the 1990s and 2000s, we see a golden twenty-year period in which our national economy grew substantially and became larger. People’s purchasing power increased, and the production of goods and services in Iran grew significantly. In the 2010s, although infrastructure grew well, core technologies developed, knowledge advanced, and defensive and military power accelerated, because the government established in that decade did not proceed wisely—meaning implementing the policies of the resistance economy and neutralizing the effect of sanctions—in relation to other countries and in solving the sanctions issue, and did not follow these policies, and exclusively limited its relationship with the world to resolving issues with the West, especially the US, unfortunately, in the 2010s, we faced a kind of stagnation and recession in the economic space. Of course, this issue was due to not heeding the recommendations of the martyred Leader of the Revolution. If his recommendations had been observed in that decade, conditions would certainly have been better. Therefore, these components are not merely theoretical propositions, but have the capability of being transformed into a model of economic governance—a model based on the people, production, infrastructure, technology, defense power, active positioning in the global order, and independence coupled with outward-orientation.