Key Facts: Iran

by World Grain Staff
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Capital: Tehran

Population: 66,429,284 (July 2010 est.)

Religions: Muslim 98% (Shia 89%, Sunni 9%), other (includes Zoroastrian, Jewish, Christian and Baha’i) 2%.

Location: Middle East, bordering the Gulf of Oman, the Persian Gulf, and the Caspian Sea, between Iraq and Pakistan.

Government: Theocratic republic. Chief of state: Supreme Leader Ali Hoseini-Khamenei (since June 4, 1989); head of government: President Mahmud Ahmadinejad (since Aug. 3, 2005).

Economy: Iran’s economy is marked by an inefficient state sector, reliance on the oil sector, which provides the majority of government revenues, and statist policies, which create major distortions throughout the system. Most economic activity is controlled by the state. Private sector activity is typically limited to small-scale workshops, farming, and services. Price controls, subsidies and other rigidities weigh down the economy, undermining the potential for private-sector-led growth. Significant informal market activity flourishes. The legislature recently passed President Mahmud Ahmadinejad’s bill to reduce subsidies, particularly on food and energy. The bill would phase out subsidies — which benefit Iran’s upper and middle classes the most — over three to five years and replace them with cash payments to Iran’s lower classes. This is the most extensive economic reform since the government elevated gasoline rationing in 2007. However, previous governmentled efforts to reform subsidies — such as in the 1990s under former president Hashemi Rafsanjani — were met with stiff resistance and violent protests. High oil prices in recent years allowed Iran to greatly increase its export earnings and amass nearly $100 billion in foreign exchange reserves. But with Iran’s oil export price from March to December 2009 averaging just $55 per barrel, and with a slight decline in oil production over the past four years, the Iranian government is facing budget constraints and Iran’s foreign exchange reserves dipped to $81 billion at the end of 2009. Tehran formulated its 2009 budget to anticipate lower oil prices and has reduced some spending. Although inflation has fallen substantially because of lower oil prices, Iran continues to suffer from double-digit unemployment and underemployment. Underemployment among Iran’s educated youth has convinced many to seek jobs overseas, resulting in a significant "brain drain."

GDP per capita: $12,500 (2009 est.); inflation: 13.5% (2009 est.); unemployment 11.8% (2009 est.).

Currency: Iranian rials (IRR); 10,003 rials equal 1 U.S. dollar (Aug. 24, 2010).

Exports: $70.32 billion (2009 est.): petroleum 80%, chemical and petrochemical products, fruits and nuts, carpets.

Imports: $57.16 billion (2009 est.): wheat, rice, other grains, sugar beets, sugarcane, fruits, nuts, cotton, dairy products, wool, caviar.

Major crops/agricultural products: Coffee, soybeans, wheat, rice, corn, sugarcane, cocoa, citrus; beef.

Agriculture: 10.9% of GDP and 25% of the labor force.

Internet: Code. .ir; 45,678 (2009) hosts and 23 million (2008) users.