Local Economic and Political Development in Iran versus Foreign Influence during the Interwar Period

This panel's central theme will address Iran’s political and economic transformation during the Interwar period. Although Reza Shah Pahlavi’s policies of national economic modernization have been well documented, considerably less attention has been accorded to the interaction between foreign and local actors in Iran’s economic and political spheres. The first paper, paper entitled, “Iran in the Focus of National-Socialist Power Politics, 1933-1943.”will assess the impact of World War II on the strategies and plans of the German foreign ministry, the Wehrmacht, and the secret services. While Iran may be seen as a theatre of German power politics within the geopolitical arena of the Middle East, It will show that the Iranian government and its agencies in Tehran were aware of these plans to the extent that collaboration with the German forces was either avoided or encouraged, depending on the context. In response to these perspectives, The second paper "Iran in the Nazi New Order, 1934-1941" will discuss Germany’s economic cooperation with Iran, especially those policies led by Hjalmar Schacht, the Reich Minister of Economics from 1934 to 1937. Furthermore, it will address how the global outreach of the Nazi economy resonated with Reza Shah's vision of national modernization and also found expression in the Nazi-Soviet Pact of August 1939. Subsequently, the third paper will analyze the ramifications of Soviet trade agreements and conceptualizations of industrialization with respect to Iranian economic nationalization. It will assert that Soviet influence was adapted to local economic conditions and cultural practices, reflective of the divergences in approaches to economic centralization and manifestations of the national subject in these countries. Finally, the fourth presentation will elucidate the potential for agency amongst crafts people vis-a-vis Pahlavi economic policies of large-scale industrialization, which intensified with the growing power of monopolies during the 1930s. More specifically, it will examine the modernization of Iran’s textile industry, including its reconfiguration into factories and its impact upon local textile craftsmen. Taken in toto, these panel presentations will demonstrate that foreign interests competed for prominence in Iran’s economic and political affairs. However, the Iranian government and other local actors were capable of regulating these ties for greater benefit, which was indicative of increasing political sovereignty and diplomatic leverage. Conversely, at the domestic level, the Iranian subaltern sought a position of economic stability in its relations with the modern Iranian state.

Personal Information (Panel Organizer)

Mary Yoshinari
University of Toronto


Homa Katouzian


by Roman Siebertz / University of Bonn

In contrast to the economic and diplomatic relations between Pahlavi Iran and the Third Reich, which form a well-researched field of modern Iranian history, the military and strategic interests of Germany have found less attention. This paper will attempt to present an overview over the respective strategies and plans of the foreign ministry, the Wehrmacht and the secret services involving Iran as a theatre of German power politics in the Middle East before and after the outbreak of World War II. Aside from the question how and whether strategic planning had changed under the impact of war, the paper will also examine to which extent these plans had been known to the Iranian government, and in which way government agencies in Tehran tried either to avoid an involvement of Iran into such schedules or may have sought a collaboration with the German forces.

by Jennifer Jenkins / University of Toronto

The global parameters of Iranian history are highlighted through an examination of local developments in the 1930s and their interaction with the expansionist aims of National Socialism. Despite a row of scholarly studies, the relationship between Reza Shah's Iran and National Socialist Germany has not been fully explored. By 1941, the economic relationship between the two countries was at its height, with Germany enjoying the position of Iran's "foremost trade partner." This paper explores the place of Iran in Nazism's "New Order", paying particular attention to the system of global trade agreements established by Reich Economics Minister Hjalmar Schacht after 1934. Schacht paid a visit to Tehran in November 1936 on the occasion of the signing of the Clearing Payments Agreement. Following the visit, German firms made considerable investment in Iranian industrial infrastructure. This paper analyzes how and why Iran became a site of National Socialist economic concentration in the mid 1930s, and asks the question of how Schacht's plans for the global outreach of the Nazi economy spoke to the nationalist desires of Reza Shah's Iran for industrial modernization. It argues that in the coming together of Schacht and Reza Shah, the state economic interests of each country were of primary importance. While not discounting the importance of Nazi political ideology—and the effects of this ideology in Iran—the article asks how state ideological visions on both sides were translated into concrete economic programs. Nazi thinking on economic and political involvement in the Middle East and Central Asia positioned Iran, Afghanistan, and Turkey as a "northern tier", seeing them as buffer states to be used in containing the Soviet Union. This strategy left traces in the Nazi-Soviet Pact of August 1939. The paper will end with a look at Iran's place in the Nazi-Soviet Pact, which designated it as a zone of economic collaboration. The reaction of the Majles to the Pact will be a point of particular focus.

by Mary Yoshinari / University of Toronto

This paper will address the complexities of economic relations between Iran and the Soviet Union during the Interwar period. Firstly, it will analyze images of factories and workers in Iranian print media of the 1920s and 1930s. Such examples of news stories and advertising may be characterized by an apparent Soviet influence, which was not only indicative of economic links, but also attendant ideologies and conceptions of modern technology. On the other hand, the cultural idiom that was operative in these images underscored marked divergences in the conceptualization of economic centralization, social engineering, and representations of the national subject in these countries. In addition, this paper’s conclusions will be reinforced by findings from bilateral economic agreements between Iran and the Soviet Union during this period. Published commentaries on these treaties suggest that certain Iranian economic actors exercised considerable influence at the local level, and sometimes in conjunction with the Iranian government.