Iraq has large and fertile agricultural lands compared to its neighbors due to the two large rivers that flow through it, the Euphrates and Tigris. The country was once self-sufficient in farm products, but the agriculture sector began a steady decline in the 1970s due to government emphasis upon the oil industry. In 1976 for example, Baghdad spent 18% of its budget on farming, which then dropped to less than 10% in 1980. The Iran-Iraq War disrupted the business even more, and during the 1990s the irrigation system began breaking down and salt levels in the soil dramatically increased. Rapid population increase over the decades, a series of droughts, and international sanctions, put added pressure on the industry. By 2002 Iraq imported 80-100% of its food staples, but was still self-sufficient in fruits and vegetables.
Today Iraq is suffering the third year of drought, which is increasing the need for food imports. At the end of January 2010 for example, the Ministry of Agriculture reported that rice production decreased from 120,000 tons in 2008 to 102,000 tons in 2009. That will require about 1 million tons of rice imports to meet the country’s need. Wheat production is also down, and Iraq will need to buy 4 million tons of that staple this year. The large increase in food imports in recent years has partially led to a trade deficit in 2009.
The latest numbers by the Special Inspector General for Iraq Reconstruction show that farming makes up 8.4% of Iraq’s GDP, and 12.3% of the workforce. That makes it the second largest employer after the government. The decline of agriculture however, is leading to people leaving the rural areas to look for jobs in the cities. Whether the industry will be able to recover will largely be determined by the amount of water that Iraq receives this year. Even then, the lack of government support, and the large food ration system that distorts commodity prices and discourages farming, will mean that the business will continue to struggle in the future.
Iraq Survey Group, “Comprehensive Report of the Special Advisor to the DCIA on Iraq’s WMD,” 9/30/04
Shatab, Ali, “Iraq rice yields slump; rice imports surge,” Azzaman, 1/29/10
Special Inspector General for Iraq Reconstruction, “Quarterly Report and Semiannual Report to the United States Congress,” 1/30/10