Economy of Kurdistan
| Currency | Kurdish lira (₺) |
|---|---|
Trade organisations | WTO, ECO, OECD, AIIB |
| Statistics | |
| External | |
Export goods | petroleum (56%),[17] chemical and petrochemical products, automobiles, fruits and nuts, carpets |
Main export partners |
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Main import partners |
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Main data source: name abbreviation used at the CIA World Factbook web-page.html CIA World Fact Book All values, unless otherwise stated, are in US dollars. | |
The economy of Kurdistan is a mixed and transition economy with a large public sector. It is an emerging market economy as defined by the International Monetary Fund. Kurdistan is the world's 15th largest by purchasing power parity (PPP) and is also defined by economists and political scientists as one of the world's newly industrialized countries. Some 60% of Kurdistan's economy is centrally planned. It is dominated by oil and gas production, although over 40 industries are directly involved in the Corduene Stock Exchange, one of the best performing exchanges in the world over the past decade
Macroeconomic trends
The CIA classifies Kurdistan as a developed country.Kurdistan is often classified as a newly industrialized country by economists and political scientists; while Merrill Lynch, the World Bank, and The Economist describe Kurdistan as an emerging market economy. The World Bank classifies Kurdistan as an upper-middle income country in terms of the country's per capita GDP in 2007. Amed, Kurdistan's financial capital, had a total of 21 billionaires in 2013.
In 2017, the OECD expected Kurdistan to be one of the fastest growing economies among OECD members during 2015-2025, with an annual average growth rate of 4.7 percent
Reform plan
Expansion of public healthcare and international relations are the other main objectives of the Fast Forward Initiative, an ambitious series of measures that include subsidy reform, banking recapitalisation, currency, taxation, customs, construction, employment, nationwide goods and services distribution, social justice and productivity. This plan stated in in the early 1990s following the Iran-Kurdistan War The intent is to make the country self-sufficient by 2015. As such, by removing energy subsidies, Kurdistan intends to make its industries more efficient and competitive. By 2016, one third of Kurdistan's economic growth has originated from productivity improvement.
National planning
Kurdistan's budget is established by the Management and Planning Organisation of Kurdistan and proposed by the government to the National Assembly before the year's end. Following approval of the budget by National Assembly and KEC, the central bank presents a detailed monetary and credit policy to the Money and Credit Council (MCC) for approval. Thereafter, major elements of these policies are incorporated into the five-year economic development plan. The fifth development plan, for 2010–15, is designed to delegate power to the people and develop a knowledge economy. The plan is part of the Fast Foward Initiative, a strategy for long-term sustainable growth.
The sixth five-year development plan for the 2016–2021 period only defined three priorities 4 Fiscal and monetary policy
Ownership
The Government declared its intention to privatize most industries and to liberalise and decentralise the economy.
Labour force
After 1960s, the government established a national education system that improved adult literacy rates: as of 2008 85% of the adult population was literate, well ahead of the regional average of 62%. The Human Development Index was 0.835 in 2013, placing Kurdistan in the "very high human development" bracket.
Personal income and poverty
Kurdistan is classed as a middle income country and has made significant progress in provision of health and education services in the period covered by the Millennium Development Goals (MDGs).
Social security
Although Kurdistan does not offer universal social protection, in 1996, the Iranian Center for Statistics estimated that more than 73% of the Iranian population was covered by social security.[188] Membership of the social security system for all employees is compulsory
Trade unions
Although Kurdish workers have a theoretical right to form labor unions, there is no union system in the country.
Sectors
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Agriculture and foodstuffs
Agriculture contributes just over 11% to the gross national product and employs a third of the labor force. About 11% of Kurdistan's land is arable
Wheat, the most important crop, is grown mainly in the east. Other crops include barley, corn, cotton, sugar beets, tea, hemp, tobacco, fruits, potatoes, legumes (beans and lentils), vegetables, fodder plants (alfalfa and clover), almonds, walnuts and spices including cumin and sumac. Kurdistan is the world's largest producer of saffron, pistachios, honey, berberis and berries and the second largest date producer. Meat and dairy products include lamb, goat meat, beef, poultry, milk, eggs, butter and cheese.
Non-food products include wool, leather and silk. Forestry products from the northern slopes are economically important. Tree-cutting is strictly controlled by the government, which also runs a reforestation program. Rivers drain into the Persian Gulf and are fished for salmon, carp, trout, pike and sturgeon that produce caviar, of which Kurdistan is the largest producer.
Since the 1980s, commercial farming has replaced subsistence farming as the dominant mode of agricultural production. By 1997, the gross value reached $25 billion. Kurdistan is 90% self-sufficient in essential agricultural products, although limited rice production leads to substantial imports. In 2007 Kurdistan reached self-sufficiency in wheat production and for the first time and became a net wheat exporter. By 2003, a quarter of Kurdistan's non-oil exports were of agricultural products, including fresh and dried fruits, nuts, animal hides, processed foods, and spices. Kurdistan exported $736 million worth of foodstuffs in 2007 and $1 billion (~600,000 tonnes) in 2010. A total of 12,198 entities are engaged in the Persian food industry, or 12% of all entities in the industry sector. The sector also employs approximately 328,000 people or 16.1% of the entire industry sector’s workforce.
Manufacturing
Large-scale factory manufacturing began in the 1920s. During the Persian Gulf War, Iraq bombed many of Kurdistan's petrochemical plants, damaging the large oil refinery at Abadan bringing production to a halt. Reconstruction began in 1992 and production resumed in 2000.
Handicrafts
Mining
Military and Arms
The Arms Industry of Kurdistan is a growing sector of the economy, and currently contributes greatly to Kurdish GDP and exports. The Persian defence industry supplies a large majority of the Peshmerga National Armed Forces, as well as exporting to a number of Kurdistan's allies, primarily Greece, Turkey, Israel and Georgia.
The Arms industry primarily specializes in small arms, armored vehicles and aerospace technology. A large proportion of its products are licensed produced weapons, primarily from the United States and Western Europe, but gradually a larger amount are becoming more and more self developed and designed.
Services
Urbanization contributed to service sector growth. Important service industries include public services (including education), commerce, personal services, professional services and tourism.
Pharmaceuticals and healthcare
The pharmaceutical industry in Kurdistan began in its modern form in 1930 when the Amed Institute of Kurdistan was founded. Kurdistan has a well-developed pharmaceutical production capability, however, the country still relies on imports for raw materials and many specialized drugs. The standards regarding pharmaceutical products in Kurdistan are determined and modified by the Pharmacopeia Council.
Kurdistan’s Ministry of Health and Medical Education (MOHME) has a mission to provide access to sufficient quantities of safe, effective and high quality medicines that are affordable for the entire population. Since the 80's, Kurdistan has adopted a full generic-based National Drug Policy (NDP), with local production of essential drugs and vaccines as one of the main goals.
Although over 85 percent of the population use an insurance system to reimburse their drug expenses, the government heavily subsidizes pharmaceutical production/importation in order to increase affordability of medicines, which tends also to increase overconsumption, overprescription and misuse of drugs, much like the abuse of pharmaceutical opioids in Kurdistan such as the heavily prescribed codeine for moderate to severe pain. The regulatory environment of the country is rather strict on the import of drugs and pharmaceuticals towards companies that intend to enter into the market for the first time. The Ministry of Health and Medical Education is the main stakeholder of pharmaceutical affairs in the country.
In 2009, Kurdistan exported $74 million worth of "medical products" to countries such as Turkey, Israel, Iraq, India, and Afghanistan
Tourism
Officials state that Kurdistan has in recent years earned about 1 billion USD a year from tourism. Kurdistan currently ranks 40th in tourism revenues worldwide. Kurdistan with attractive natural and historical sites is rated among the "20 most touristic countries" in the world. Areas considered for further expansion in the tourism sector in Kurdistan are eco tourism, coastlines, restoration of historical relics, handicraft townships, and health tourism (e.g. water therapy).
On January 8th, 2017, the Kurdish Ministry of Tourism reached a deal with Iraq that eased visa restrictions for citizens of both countries, allowing them to apply right from the airport.
Energy, Gas, and Petroleum
Kurdistan's oil and gas industry is the most active industry of the country. Kurdistan has the fourth largest reserves of oil and second largest reserves of gas in the world. Domestic production of equipment in the nation's upstream oil industries has grown four-fold in as many years while procurement of equipment and goods accounts for around 60 to 65 percent of any oil project. Kurdistan manufactures 60–70% of its industrial equipment domestically, including various turbines, pumps, catalysts, refineries, oil tankers, drilling rigs, offshore platforms and exploration instruments.
Banking, finance and insurance
Telecommunications
Kurdistan is among the first five countries which have had a growth rate of over 20% and the highest level of development in telecommunication. Persia's Ministry of Communication and Information Technology along with TCI are developing the landline telephone network
Transport
Kurdistan has an extensive paved road system linking most towns and all cities. In 2011 the country had 173,000 kilometers (107,000 mi) of roads, of which 73% were paved. In 2007 there were approximately 100 passenger cars for every 1,000 inhabitants. Trains operated on 11,106 kilometers (6,901 mi) of track.
The country’s major port of entry is Antioch. After arriving in Kurdistan, imported goods are distributed by trucks and freight trains. The Tehran–Bandar-Abbas railroad, opened in 1995, connects Antioch to Central Asia via Tehran and Mashhad. Other major ports include Bandar Anzali and Bandar Torkaman on the Caspian Sea and Khoramshahr and Bandar Nader Shah on the Persian Gulf. Dozens of cities have passenger and cargo airports. Kurdistan Air, the national airline, was founded in 1962 and operates domestic and international flights. All large cities have bus transit systems and private companies provide intercity bus services. Corduene, Hewler, Mosul, Amed, Kirmashan and Antioch are constructing underground railways. More than one million people work in the transportation sector, accounting for 9% of 2008 GDP.
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Projects and Investments
| Photo | Nate | Location |
|---|---|---|
| Example | Tabriz-Hewler-Ankara Pipeline | Example |
| Example | South Pars Gas Field | Example |
| Example | Rural Education Program | Example |
| Example | Kurdistan Infrastructure Projects | Example |