War has already been declared in Iran — between Coca-Cola and the theocrats
The Shah is Dead. Long live the Shah — and I don’t mean Reza Pahlavi, the 45-year-old pretender to his late father’s Peacock Throne, whom many in Washington would like to install atop this most vexatious nation. The way things are going nuclear-wise, he may have a chance. But almost three decades after Khomeini’s revolution, the monarch who matters among Tehran’s business elite is the ‘Shah of Pistachios’, Akbar Hashemi Rafsanjani. Iran’s once and perhaps future president is widely believed to be the country’s richest man: his family’s writ runs to airlines, caviar, oil, mining, automobiles, property and agriculture, which pretty much covers the entire economy. There’s supposedly billions stashed in Switzerland, Singapore and Luxembourg; and property in France, Canada, Dubai, India and Thailand. The ex-president’s clan denies it but poor Iranians who see their leaders squander Iran’s wealth in Hezbollah adventurism (and probably in Iraq too) snort that Rafsanjani doth protest too much. One intrepid local hack pried too closely into Rafsanjani Inc a few years back and is now doing a stretch inside. A local businessman I met is convinced he did three years’ porridge in the 1990s because he refused to yield when Rafsanjani’s lieutenants fancied his profitable farms. That, or because he was Bahai, regarded as heretical by Iran’s Shia mullahs. But he was lucky: Tehran’s small coterie of investigative journalists and anti-corruption activists are still reeling from a spate of unsolved murders in 2000. In most places out east, bankers know to ‘follow the money’ to discover where power lies. In this by turns frustrating, complex and charming country, you follow the mullahs and ayatollahs to find the loot — and the power.
Irepair in some despair to lunch at Nayeb, in fashionable north Tehran. Elegant ladies who lunch pick at grilled Alborz trout and salad, the chatter gliding effortlessly between French, English and Farsi. The clientele is as chic as in any Paris eatery, and the only hint that we’re in the heart of the Axis of Evil is the hijab Iranian women are obliged to wear or risk attacks from Islamist militias. The demands of mosque and mode merge in expensive Hermès scarves, exposing sexy blond-tipped fringes.
The Nayeb set’s preferred tipple is proba bly Krug, but Khomeini’s was a teetotal revolution so they make do with Coca-Cola. Coca-Cola? Hang on, isn’t corporate America banned from doing business in Iran? Yes, but Washington bent the rules in 1999 for ‘foodstuffs’, allowing Pepsi and Coke to open a new front in their global Cola wars. Coke has been selling here since 1999 and Pepsi since 2001, after being kicked out in 1979. They’ve already grabbed about half of Iran’s $1 billion beverage market and are taking aim at the sector leader, Zamzam, named for the blessed well at Mecca. The theocrats want Iranians to shun ‘Great Satan’ brands which allegedly send profits to be converted into ‘bullets piercing the chests of Lebanese and Palestinian children’. Mehdi Minai, a hardline official of the mosque-linked Public Demands Council, says Pepsi stands for ‘Pay Each Penny to Save Israel’. Big Beverage dismisses such blather: they know Iran’s young consumers are by no means as engaged in the Palestinian conflict as their Arab neighbours. Anti-US protests in Tehran are pretty thin these days and most Iranians lament their government’s stand-off with Washington. ‘I joke with customers not to buy this stuff because it’s American,’ says Tehran storekeeper Reza Shahgholi, around the corner from the old US embassy, today the American Atrocities Museum. ‘But that only makes them want to buy it more.’ The best thing going for Coke and Pepsi isn’t their American-ness but the fact that Zamzam is run by a bonyad. These are the religious charities Khomeini used to quasi-nationalise Iran’s economy after 1979. Conceived to help Iran’s needy, bonyads are no model of modern management. Many have become goldmines for the powerful, which in Iran means the pious. Zamzam’s plants are controlled by the Foundation of the Dispossessed, answering to the Supreme Leader, Ayatollah Ali Khamenei. If he chooses to fatwa Coke and Pepsi out of Iran, what will look like a religious ruling might actually be about something quite different.
Bonyads control trillions of rials worth of assets, including the four hotels that operated under the Hyatt, Hilton, Sheraton and Intercontinental banners in the 1970s. I stayed at the old Hyatt, now the $150-a-night Azadi (‘Freedom’), where barely a cent has been spent since the revolution. Very little works properly, from television to internet to hot water to lifts. A satellite brings the BBC into the room but when something isn’t to taste, the mullahs simply cut or delay the sound. The results can be amusing. By the time the voiceover to a Singapore Airlines ad arrived, the picture had switched to a news item showing someone being airwinched to safety during a storm.
Ibrave Tehran’s stifling smog to see the two companies largely responsible for it, stateowned carmakers Iran Khodro and Saipa. Iran Khodro recently junked the venerable Paykan, a Hillman Hunter knock-off which had been in production since the 1960s. It had one of the world’s least fuel-efficient engines — but when a full tank cost just $8, milesper-gallon wasn’t an engineering priority. Punching out a million cars a year, one of the biggest markets in the developing world, Iran now assembles for the French, German and Koreans. But executives presume they are in the crosshairs of Washington’s warmongers, so they’ve prudently made plans just in case.
The plans evoke traffic lights, which I’ve noticed Iranian motorists have particular contempt for. Green is for normalised relations with the US, while yellow is the status quo: Iran as Western pariah. Red presumes ‘attack and invasion, even nuclear’. ‘We would operate,’ Hossein Momeni of Saipa says, ‘but we would decrease some of the lines because of the lack of customers.’ As war edges ever closer, the carmakers are sanguine about the uncertain future. ‘Business is business,’ he says. ‘After five to six years, I believe we will be producing Chevrolets.’ Eric Ellis is Southeast Asia correspondent of Fortune magazine.
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