alf of its irrigated land is
planted in cotton, making it the world's tenth largest producer. It
also possesses the world's fifth largest reserves of natural gas and
substantial oil resources. Until the end of 1993, Turkmenistan had
experienced less economic disruption than other former Soviet states
because its economy received a boost from higher prices for oil and
gas and a sharp increase in hard currency earnings. In 1994,
Russia's refusal to export Turkmen gas to hard currency markets and
mounting debts of its major customers in the former USSR for gas
deliveries contributed to a sharp fall in industrial production and
caused the budget to shift from a surplus to a slight deficit. The
economy bottomed out in 1996, but high inflation continued.
Furthermore, with an authoritarian ex-communist regime in power and
a tribally based social structure, Turkmenistan has taken a cautious
approach to economic reform, hoping to use gas and cotton sales to
sustain its inefficient economy. In 1996, the government set in
place a stabilization program aimed at a unified and market-based
exchange rate, allocation of government credits by auction, and
strict limits on budget deficits. Privatization goals remain
limited. Turkmenistan is working hard to open new gas export
channels through Iran and Turkey to Europe, but these will take many
years to realize. In 1998 Turkmenistan faced revenue shortfalls due
to the continued lack of adequate export routes for natural gas and
obligations on extensive short-term external debt.

GDP: purchasing power parity--$7 billion (1998 est.)

GDP--real growth rate: 5% (1998)

GDP--per capita: purchasing power parity?$1,630 (1998 est.)

GDP--composition by sector:
agriculture: 18%
industry: 50%
services: 32% (1996 est.)

Population below poverty line: NA%

Household income or consumption by percentage share:
lowest 10%: 2.7%
highest 10%: 26.9% (1993)

Inflation rate (consumer prices): 19.8% (1998 est.)

Labor force: 2.34 million (1996)

Labor force--by occupation: agriculture and forestry 44%, industry
and construction 19%, other 37% (1996)

Unemployment rate: NA%

Budget:
revenues: $521 million
expenditures: $548 million, including capital expenditures of $83
million (1996 est.)

Industries: natural gas, oil, petroleum products, textiles, food
processing

Industrial production growth rate: NA%

Electricity--pro