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Turkmenistan is predominantly a desert country with large oil and natural gas reserves. Cotton is an important cash crop grown in almost half of the total irrigated land. Agricultural land is concentrated around the many oases in this desert country. Turkmenistan has been very cautious towards economic reforms based on its resources of oil, natural gas and cotton. Between 2003 and 2007 a high price of oil and gas globally, increased Turkmenistan’s export earnings by almost 15% annually. The economy of Turkmenistan is characterized by widespread poverty, poor educational system, and misuse of governmental revenues. In its effort to improve economic well being of its inhabitants, the present government has decreased subsidies on oil, attempting to unify its dual currency exchange rate, formed a special tourism zone around the Caspian Sea, and signed an agreement with People’s Republic of China for construction of a gas line.
Economic activities of Turkmenistan
Gas and oil are the primary natural resources of Turkmenistan. Food grains and cotton are grown in oases regions. Cattle grazing and livestock farming are the other primary activities in this desert country. Agricultural sector provides employment to more than 48% of occupied labor force, and accounts for more than 11% of GDP (gross domestic product).
Extraction of gas and oil are the predominant industries in Turkmenistan. Manufacture of petroleum products and textiles are the other notable industries. Food processing is an important agriculture based industry. Industrial production contributes almost 41% towards GDP, and this sector engages 14% of the occupied labor supply.
The tertiary or services sector involving trade, commerce, telecommunications, transport and banking provides employment to almost 38% of the labor force. Its contribution to GDP amounts to almost 48%.
Crude oil, petroleum products, natural gas, cotton fiber and textiles are the major export commodities of Turkmenistan. The import goods include food items, machineries, equipments, and chemicals. Ukraine, Turkey, Russia, China, Iran, Azerbaijan, Germany and the USA are the key trading partners of Turkmenistan.
Economic indicators of Turkmenistan
The following are the vital economic parameters of Turkmenistan:
- GDP calculated on purchasing power parity (ppp) – US $26.92 billion
- GDP as based on official exchange rate – US $ 26.91 billion
- Per capita GDP (ppp) – US $5,300
- Real growth rate of GDP – 11.5% (as per International Monetary Fund fig.)
- Gross fixed investment – 32.5% of GDP
- Total revenue – US $1.664 billion
- Total expenditure – US $1.624 billion
- Export earning – US $7.567 billion f.o.b. (free on board)
- Import expenditure – US $ 4.516 billion f.o.b. (free on board)
- Electricity consumption – 7.602 billion kWh*
- Oil consumption – 156,000 bbl (billion barrels) per day
- Currency – Turkmen manat, represented as TMM
All figures are based on findings of year 2007, except * marked figure which is as per estimates of 2005.