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    Iraq Economy - 2004

      Economy - overview:
      Iraq's economy is 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 from that war of at least $100 billion. After hostilities ended 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 sanctions, and damage from military action by an international coalition beginning in January 1991 drastically reduced economic activity. Although government policies supporting large military and internal security forces and allocating resources to key supporters of the regime have hurt the economy, implementation of the UN's oil-for-food program beginning in December 1996 helped improve conditions for the average Iraqi citizen. Iraq was allowed to export limited amounts of oil in exchange for food, medicine, and some infrastructure spare parts. In December 1999, the UN Security Council authorized Iraq to export under the program as much oil as required to meet humanitarian needs. The drop in GDP in 2001-02 was largely the result of the global economic slowdown and lower oil prices. Per capita food imports increased significantly, while medical supplies and health care services steadily improved. Per capita output and living standards were still well below the pre-1991 level, but any estimates have a wide range of error. The military victory of the US-led coalition in March-April 2003 resulted in the shutdown of much of the central economic administrative structure, but with the loss of a comparatively small amount of capital plant. The rebuilding of oil, electricity, and other production is proceeding steadily at the start of 2004 with foreign support and despite the continuation of severe internal strife. A joint UN and World Bank report released in the fall of 2003 estimated that Iraq's key reconstruction needs through 2007 would cost $55 billion. In October 2003, international donors pledged assistance worth more than $33 billion toward this rebuilding effort.

      purchasing power parity - $38.79 billion (2003 est.)

      GDP - real growth rate:
      -20% (2003 est.)

      GDP - per capita:
      purchasing power parity - $1,600 (2003 est.)

      GDP - composition by sector:
      agriculture: 6%
      industry: 13%
      services: 81% (1993 est.)

      Population below poverty line:

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

      Inflation rate (consumer prices):
      27.5% (2003 est.)

      Labor force:
      7.8 million (2004 est.)

      Labor force - by occupation:
      agriculture NA%, industry NA%, services NA%

      Unemployment rate:
      NA% (2003 est.)

      revenues: $12.8 billion $NA
      expenditures: $13.4 billion $NA, including capital expenditures of $NA (2004 budget)

      petroleum, chemicals, textiles, construction materials, food processing

      Industrial production growth rate:

      Electricity - production:
      36.01 billion kWh (2001)

      Electricity - production by source:
      fossil fuel: 98.4%
      hydro: 1.6%
      other: 0% (2001)
      nuclear: 0%

      Electricity - consumption:
      33.49 billion kWh (2001)

      Electricity - exports:
      0 kWh (2001)

      Electricity - imports:
      0 kWh (2001)

      Oil - production:
      2.2 million bbl/day; note - prewar production was 2.8 million bbl/day (January 2004 est.)

      Oil - consumption:
      460,000 bbl/day (2001 est.)

      Oil - exports:
      1.7 million bbl/day (January 2004)

      Oil - imports:

      Oil - proved reserves:
      113.8 billion bbl (1 January 2002)

      Natural gas - production:
      2.76 billion cu m (2001 est.)

      Natural gas - consumption:
      2.76 billion cu m (2001 est.)

      Natural gas - exports:
      0 cu m (2001 est.)

      Natural gas - imports:
      0 cu m (2001 est.)

      Natural gas - proved reserves:
      3.149 trillion cu m (1 January 2002)

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

      $7.542 billion f.o.b. (2003 est.)

      Exports - commodities:
      crude oil

      Exports - partners:
      US 37.4%, Taiwan 7.7%, Canada 7.5%, France 7.5%, Jordan 6.9%, Netherlands 5.8%, Italy 4.9%, Morocco 4.3%, Spain 4.1% (2002)

      $6.521 billion f.o.b. (2003 est.)

      Imports - commodities:
      food, medicine, manufactures

      Imports - partners:
      Jordan 10.4%, France 8.4%, China 7.9%, Vietnam 7.9%, Germany 7.2%, Russia 6.9%, Australia 6.8%, Italy 6.1%, Japan 5.3% (2002)

      Debt - external:
      $120 billion (2003 est.)

      Economic aid - recipient:
      more than $33 billion in foreign aid pledged for 2004-07 (2004)

      New Iraqi dinar (NID) as of 22 January 2004

      Currency code:
      NID, IQD prior to 22 January 2004

      Exchange rates:
      New Iraqi dinars per US dollar - 1,890 (second half, 2003)

      Fiscal year:
      calendar year

      NOTE: The information regarding Iraq on this page is re-published from the 2004 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Iraq Economy 2004 information contained here. All suggestions for corrections of any errors about Iraq Economy 2004 should be addressed to the CIA.

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    Revised 21-May-04
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