Turkmenistan

A

Agriculture

Turkmenistan’s economy is predominately agricultural, with more than 40 percent of the labor force employed in the sector. Cotton is the primary crop, and Turkmenistan is one of the world’s leading producers of the fiber. However, Turkmenistan’s hot, dry climate and scarcity of water resources make it ill-suited for cotton production. Great amounts of water must be diverted to cotton crops through outdated and inefficient irrigation canals, such as the Garagum Canal, which were built during the Soviet period.

Turkmenistan’s government has encouraged some shift away from cotton cultivation, with the goal of diversifying crops and achieving self-sufficiency in food production. Although the principal food crop is wheat, Turkmenistan must import large quantities of the grain. Other cereal grains, vegetables, and fruit are also grown in the country. Livestock raising is also important, especially of Karakul sheep, horses, and camels. Although the collective (state-run) farms of the Soviet period have been reorganized into farmer-operated associations, the government continues to intervene in the sector. For example, it imposes production targets for wheat and cotton harvests and requires farms to supply state orders for those crops at low prices.

B

Mining and Manufacturing

The principal industry in Turkmenistan is the extraction of natural gas and oil. The country also produces important industrial minerals, including gypsum, iodine, bromine, sulfur, and salt. Energy products, primarily natural gas, are the largest export item. Turkmenistan is the second largest producer of natural gas among the former Soviet republics (after Russia). The gas deposits are located along the Caspian Sea coast and in the northern and eastern sections of the country. In the early 1990s the Turkmenistan government launched several large-scale ventures involving foreign partnerships to explore, develop, and export natural gas. Foreign investment was especially needed for the construction of new export pipelines, which the government sought as a way of achieving economic independence. In 1997 the first new pipeline opened, connecting gas fields in Turkmenistan with northern Iran. By the early 2000s, however, foreign interest in additional development had waned, mostly due to better prospects in Kazakhstan and Azerbaijan. Most of Turkmenistan’s gas and oil continued to be exported through pipelines controlled by Russia, which imposed transit fees and quantity limitations. Aside from the production of fuels, industry in Turkmenistan is limited mainly to food processing and textile production.

C

Currency and Trade

Turkmenistan remains dependent on trade with former Soviet republics, most of which now belong to the Commonwealth of Independent States (CIS). The export of fossil fuels drives the country’s foreign trade, and Turkmenistan has secured long-term gas-export agreements with Russia, Ukraine, and Iran. Besides other members of the CIS, Turkmenistan’s important trading partners include Turkey, Italy, and the United States. Turkmenistan’s involvement in international trade has been limited by the country’s geographic isolation, as well as its limited range of products. Its landlocked location poses significant problems in transporting products to and from world ports. It gained a new route to international markets in 1996 by the opening of a new railroad connecting Turkmenistan with Iran, and thereby the Indian Ocean. Because the new railroad connects with the former Soviet railway grid, it also significantly reduces travel time by rail between Europe and Southeast Asia.

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The currency of Turkmenistan is the manat, which was introduced in 1993 to replace the Russian ruble. The government maintains a fixed exchange rate on the manat, rather than allowing market forces to determine its value. The official rate of exchange in 2001 was 5,200 manats per U.S.$1.

V

Government

Turkmenistan promulgated its first constitution as an independent republic in May 1992, replacing the constitution of the Soviet period. The republic does not yet have a multiparty system in place, and most candidates have run unopposed in elections. All citizens aged 18 and older may vote.

A

Executive

The president of Turkmenistan is head of state, head of government, and supreme commander of the armed forces. The office of president was established in Turkmenistan in 1990 shortly before the republic’s independence from the Soviet Union. The 1992 constitution increased the powers of the president and made the president head of the Council of Ministers with the option of appointing a prime minister at any time. The president appoints the members of the council, which administers the daily operations of government. Under the constitution, the president is directly elected to a five-year term and may be elected for no more than two consecutive terms. However, in 1999 the Khalk Maslakhaty (People’s Council), the most powerful government body in the country, removed all limits to the term of President Saparmurad Niyazov, effectively making him president for life.

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