Hostage 'victory' saved Iran from disaster

The Iranian government is presenting the hostage deal as a shining "victory." In fact, the agreement saved Iran from humiliating financial disaster -- at least for the time being.

By the time the American hostages walked through jeering young Revolutionary Guards to the Algerian planes and freedom, Iran had only enough financial reserves left to last six months. The figure was disclosed by Ali Reza Nobari, governor of the central bank of Iran, when the hostage negotiations still seemed deadlocked.

Other analysts believe even that assessment was optimistic. Western sanctions, the grinding war with Iraq, and the uncertainties of erratic fundamentalist rule had placed the country in serious economic straits -- with signs of growing disillusionment among the bazaaris, or small business men, who initially had backed the Islamic revolution wholeheartedly.

Now the regime has immediate access to some $2.9 billion of its unfrozen assets, and the probability of more to come as the hostage agreement's arbitration process gets under way.

Perhaps as important, the Western sanctions imposed when the hostages were seized are being dismantled and the country is being released from its economic isolation.

The expectation is that the inflow of funds will be put to two prompt uses:

* Easing some of the many shortages brought about by both Western sanctions and the war with Iraq.

* Buying much-needed hardware to prosecute the war.

Iranians hope that the European nations will be forthcoming almost immediately with some defense material and other goods withheld for more than seven months -- "If not for love of Iran itself, at least to help the ailing economy," as one Iranian put it.

Even during the boycott, Iran was getting some items from the West through triangular deals with third countries. The goods now will come directly.

As far as the United States is concerned, however, Iran's chief hostage negotiator, Behzad Nabavi, has insisted that the Islamic Republic wishes to cut all financial and economic relations. Tehran is therefore unlikely to announce in the near future that it wishes to purchase spare weapons parts from Washington. Nor, at time of writing, had Iranian officials revealed what decision they have taken regarding the military spare parts paid for before the hostage crisis but not delivered.

Internally, the fundamentalists ruling the country have long since stopped using the hostage crisis for political gains. In the words of Mr. Nabavi, it was "like a fruit from which the juice has been sucked."

But the eventual agreement may provide as much criticism as cash. In the very first hours after the release of the prisoners, critics of the regime were asking awkward questions. "They finally had to return the hostages without getting what they wanted -- neither the Shah nor his wealth," one Iranian commented.

In a kind of "meet-the-people" radio program, aired at about the time the hostages were being flown away, one caller asked Mr. Nabavi: "Before the crisis, we had our assets, and now after the hostages have been released, we just have our own assets back. What has been the point of it all, considering the price we have had to pay?"

Mr. Nabavi attempted to duck the issue: "We were not involved in a business transaction." But it was clear from this and other questions that the fundamentalists would have to duck the verbal fire that is coming in their direction for some time.

President Abolhassan Bani-Sadr, who heads the moderates opposing the fundamentalists (including Mr. Nabavi), has not yet begun the attack he is expected to make. Throughout the past two months of negotiations Mr. Bani-Sadr has carefully busied himself with the war with Iraq. He was not even present in Tehran when the hostages flew out. A few hours earlier he had flown back to the battlefront in Khuzestan Province from the same Tehran airport.

That was an almost symbolic move, since with the hostages now out of the way, the Iranians are expected to give more of their time and attention to the war. Indeed, less than 24 hours after the American captives had gone, Ayatollah Ruhollah Khomeini set the mood with a broadcast focusing attention on the war, calling for discipline and coordination among his forces.

Ayatollah Khomeini has considered the hostages a dead issue since September. He reputedly believed they had become an obstacle in his dream of exporting the Islamic revolution.

But in general there has been a sigh of relief among Iranians that the crisis is over. A dealer in gold coins said the price of gold had fallen -- a sign that traders were converting to liquid cash some of the assets they had converted to gold during the crisis. The cash would be needed to open letters of credit to begin importing goods from Europe.