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Iraq Economy

    Economy—overview: Iraq's economy has been dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. In the 1980s, financial problems caused by massive expenditures in the eight-year war with Iran and damage to oil export facilities by Iran led the government to implement austerity measures, borrow heavily, and later reschedule foreign debt payments; Iraq suffered economic losses of at least $100 billion from the war. After the end of hostilities in 1988, oil exports gradually increased with the construction of new pipelines and restoration of damaged facilities. Iraq's seizure of Kuwait in August 1990, subsequent international economic embargoes, and military action by an international coalition beginning in January 1991 drastically reduced economic activity and increased prices. The Iraqi Government has been unwilling to abide by UN resolutions so that the economic embargo could be removed. The government's policies of supporting large military and internal security forces and of allocating resources to key supporters of the regime have exacerbated shortages. The implementation of the UN's oil-for-food program in December 1996 has helped improve economic conditions. For the first three six-month phases of the program, Iraq was allowed to export $2 billion worth of oil in exchange for food, medicine, and other humanitarian goods. The UN allowed Iraq to export $5.2 billion of oil beginning with the fourth phase of the program in May 1998. At an average volume of 1.9 million barrels per day during the last half of 1998, oil exports are about three-quarters their prewar level. Per capita food imports have increased significantly, while medical supplies and health care services are steadily improving. Per capita output and living standards are still well below the prewar level, but any estimates have a wide range of error.

    GDP: purchasing power parity—$52.3 billion (1998 est.)

    GDP—real growth rate: 10% (1998 est.)

    GDP—per capita: purchasing power parity—$2,400 (1998 est.)

    GDP—composition by sector:
    agriculture: NA%
    industry: NA%
    services: NA%

    Population below poverty line: NA%

    Household income or consumption by percentage share:
    lowest 10%: NA%
    highest 10%: NA%

    Inflation rate (consumer prices): NA%

    Labor force: 4.4 million (1989)

    Labor force—by occupation: services 48%, agriculture 30%, industry 22% (1989)

    Unemployment rate: NA%

    Budget:
    revenues: $NA
    expenditures: $NA, including capital expenditures of $NA

    Industries: petroleum, chemicals, textiles, construction materials, food processing

    Industrial production growth rate: NA%

    Electricity—production: 27.6 billion kWh (1996)

    Electricity—production by source:
    fossil fuel: 97.83%
    hydro: 2.17%
    nuclear: 0%
    other: 0% (1996)

    Electricity—consumption: 27.6 billion kWh (1996)

    Electricity—exports: 0 kWh (1996)

    Electricity—imports: 0 kWh (1996)

    Agriculture—products: wheat, barley, rice, vegetables, dates, cotton; cattle, sheep

    Exports: $5 billion (1998 est.)

    Exports—commodities: crude oil

    Exports—partners: Russia, France, China, Turkey (1998)

    Imports: $3 billion (1998 est.)

    Imports—commodities: food, medicine, manufactures

    Imports—partners: Russia, France, Jordan, Australia, China (1998)

    Debt—external: very heavy relative to GDP but the exact amount is unknown (1998)

    Economic aid—recipient: $327.5 million (1995)

    Currency: 1 Iraqi dinar (ID) = 1,000 fils

    Exchange rates: Iraqi dinars (ID) per US$1—0.3109 (fixed official rate since 1982); black market rate—Iraqi dinars (ID) per US$1—1,810 (December 1998), 1,530 (December 1997), 3,000 (December 1995); subject to wide fluctuations

    Fiscal year: calendar year

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Revised 1-Mar-99
Copyright © 1999 Photius Coutsoukis (all rights reserved)