Economics

Definition - Oregon Teaching Standards on Economy: Understand economic concepts and principles and how available resources are allocated and a market economy. Analyze the structure and functioning of various economic systems, their relationship to national and international political, social, and geographic systems, and the conditions that influence the development of such systems.

Content: Understand how economic conditions in a market economy influence and are influenced by the decisions of consumers, producers, economic institutions, and government.



Factsheet Iran Economy
Feb 19th 2008
From the Economist Intelligence Unit
Source: Country ViewsWire
http://www.economist.com...

Annual data 2006(a) Historical averages (%) 2002-06
Population (m) 70.3 Population growth 1.0
GDP (US$ m; market exchange rate) 222,881 Real GDP growth 6.0
GDP (US$ m; purchasing power parity) 692,884 Real domestic demand growth 6.9
GDP per head (US$; market exchange rate) 3,172 Inflation 14.1
GDP per head (US$; purchasing power parity) 9,860 Current-account balance (% of GDP) 4.5
Exchange rate (av) IR:US$ 9,171 FDI inflows (% of GDP) 0.3
(a) Actual.

Background: Iran became an Islamic Republic after a popular uprising overthrew the regime of the shah in 1979. The Shia clergy assumed control of the state and reversed the shah's pro-Western stance. As vali-e-faqih (the supreme Islamic jurisprudent), Ayatollah Ruhollah Khomeini became the supreme religious and political leader. From 1980 to 1988 the country was at war with Iraq. Akbar Hashemi Rafsanjani held the post of president for two terms from 1989 to 1997, during which time attempts to introduce economic reforms were frustrated by internal opposition. Mohammed Khatami, who was first elected president in 1997, tried to introduce social and political reforms, backed by a reformist Majlis (parliament). However, the conservative establishment blocked these efforts and in 2004 hardline conservatives won control of parliament. In 2005, Mahmoud Ahmadinejad, a populist conservative, was elected to the presidency.

Political structure: Iran is an Islamic Republic as defined by its constitution. The president is elected every four years by popular vote, although all candidates must be vetted by the Guardian Council. Superimposed on this republican constitutional structure are several unique Islamic features: the vali-e-faqih exercises considerable power over the government, and the conservative Guardian Council approves all legislation to ensure that it complies with Islamic law.

Policy issues: Iran's five-year economic plans have emphasised a gradual move towards a market-oriented economy, but political and social concerns, and external debt problems, have hampered progress. Faster movement, however, occurred under the third five-year plan (2000-04), which advocated a more ambitious programme of liberalisation, diversification and privatisation. The resolution of Iran's external debt problems eased the policymaking environment and facilitated the unification of the exchange rate in 2002. However, the conservative-dominated Majlis and the government of Mr Ahmadinejad are unsympathetic to reform.

Taxation: Iranian tax laws are complex and have been applied inconsistently. The government has lowered unified corporation tax rates and aims to simplify tax administration, but the process will continue to be slow, and foreign firms are likely to continue to face some uncertainty when assessing their tax liabilities.

Foreign trade: Oil earnings comprise over 80% of export revenue. High oil prices since 2000 have resulted in large trade surpluses, despite a marked rise in import spending, as strong foreign-exchange earnings and the easing of the debt-repayment schedule have allowed Bank Markazi (the central bank) to relax its import compression programme.

Major exports 2004 % of total Imports 2004 % of total
Oil&gas 82.8 Raw materials&intermediate goods 47.7
Chemicals&Petrochemicals 4.0 Capital goods 34.2
Dried fruit and nuts 2.0 Consumer goods 18.0
Leading markets 2006 % of total Leading suppliers 2006 % of total
Japan 14.1 Germany 12.1
China 12.9 China 10.6
Turkey 7.3 UAE

9.4

Nov 15th 2007
From the Economist Intelligence Unit
Source: Country Profile

2003(a) 2004(a) 2005(a) 2006(b) 2007(b)
GDP at market prices (IR trn) 1,059.8 1,350.8 1,701.2 1,982.0 2,413.2
GDP (US$ bn) 129.3 156.8 189.8 216.1 256.5
Real GDP growth (%) 7.1 5.1 4.4 4.3 4.3
Consumer price inflation (av; %) 16.5 14.7 13.4 11.6(a) 17.0
Population (m) 68.0 68.7 69.4 70.3(a) 70.9
Exports of goods fob (US$ m) 33,991.0 43,852.0 60,012.0 66,797.1 71,447.8
Imports of goods fob (US$ m) 29,561.0 38,199.0 40,969.0 45,667.4 48,064.9
Current-account balance (US$ m) 816.0 1,442.0 14,037.0 16,657.8 18,999.4
Foreign-exchange reserves excl gold (US$ m) 24,427.0 32,709.0 45,209.0(b) 58,209.0 64,209.0
Total external debt (US$ bn) 12.3 13.6 13.9 13.7 13.8
Debt-service ratio, paid (%) 4.6(b) 4.1(b) 3.6(b) 2.9 2.6
Exchange rate (av) IR:US$ 8,193.9 8,614.0 8,964.0 9,170.9(a) 9,407.5
(a) Actual. (b) Economist Intelligence Unit estimates.


Origins of gross domestic product 2004(a) % of total Components of gross domestic product 2004(a) % of total
Services 51.8 Private consumption 54.2
Agriculture 13.7 Public consumption 10.9
Industry 34.5 Gross fixed investment 35.2
Oil 10.4 Net external sector -7.1
Principal exports fob 2004(b) US$ m Principal imports cif 2004(b) US$ m
Oil & gas 36,827 Capital goods 12,105
Petrochemicals 1,431 Industrial products 12,004
Fresh & dry fruits 772 Consumer goods 6,386
Main destination of exports 2006 % of total Main origins of imports 2006 % of total
Japan 14.1 Germany 12.1
China 12.9 China 10.6
Turkey 7.3 UAE 9.4
Italy 6.3 South Korea 6.2
South Korea 5.7 France 5.6
(a) In real terms; Bank Markazi data. (b) Bank Markazi data.


See following documents for more in depth discussion of related topics:

Submitted by Admin on Wed, 02/06/2008 - 8:51pm.