Iran

Iran (Persian language: ايران, meaning "land of the Aryans"), officially the Islamic Republic of Iran (Persian language: جمهوری اسلامی ايران), is a Middle Eastern Islamic Republic. It is seen as the descendant of the Ancient Persian Empire and Persians make up an ethnic majority of the Iranian population. The official language of the country is Persian. The official religion of the country is Twelver Shi'a Islam.

Geography

Iran borders the Caspian Sea and Turkmenistan to the north, Iraq and the Persian Gulf to the west and south, and Afghanistan and Pakistan to the east. Iran, largely mountainous and prone to earthquakes, is mostly situated on the Iranian Plateau. The centre of the country is dominated by two large deserts with very little life and the majority of people live in the western half of the country.

History

Iran is one of the world's most ancient civilizations. Iranians, called Persians by the Greeks, built a huge empire in the 6th and 5th centuries BC before being conquered by the Greeks under Alexander the Great and then by the Romans. Iran regained part of its empire under the Sassanids before they were conquered by the Arabs, who introduced Islam and greatly influenced the Iranian culture and language. Iran was ruled by the Arabs for several hundred years, then by a succession of tribal dynasties after the Arab empire under the Caliphs broke up. The Safavids gained control of Iran in the 16th century and brought a new golden age to Iran. The Safavid empire collapsed in 1722, and Iran increasingly came under the influence of various European powers. In the early 20th century, the Pahlavi dynasty consolidated power. It ruled until 1979, when the Iranian revolution established the current Islamic Republic. Invaded by Iraq in an attempted land-grab in 1980, the Iran-Iraq War concluded in 1988. Despite initial disorganization and casualties in the hundreds of thousands, the new regime consolidated its power in its territorial defense.

Politics and Government

Since Khomeini's revolution, the Iranian Government has always been a complex theocratic republic. In the 2000s, it had an elected Parliament (Majlis); a President as the head of the executive branch of the Iranian Government; and a Supreme Leader as head of state and commander of the armed forces.

The Supreme Leader was chosen by the Assembly of Experts, made of 86 jurists; a Council of Guardians comprising of six clerics and six jurists who interpreted the constitution and also apply sharia law to Iran; and the Expediency Council who served as an advisory council to the Supreme Leader and were in charge of mediating disputes between the Parliament and the Council of Guardians.

Economy

Iran has both opportunity and challenge in a relatively young population, with excellent education. There is, however, high unemployment, with emigration of skilled people. There is still an overreliance on the petroleum sector, especially to fund the government. High oil prices in recent years allowed Iran to greatly increase its export earnings and amass nearly $100 billion in foreign exchange reserves. But with oil prices currently below $40 per barrel, the Iranian government is facing difficulties; their 2009 budget anticipates lower oil prices. "Iran’s economy is still unable to generate enough needed jobs to absorb the new flows into the labor market and at the same time significantly reduce unemployment. In addition to employment creation, inflation is high; price subsidies and controls hinder efficiency; and major structural impediments prevent private sector development." The country’s health and education indicators are among the best in the region. Iran continues to suffer from double-digit unemployment and inflation - inflation climbed to a 28% annual rate in 2008.

The state still controls a substantial part of the economy, and is not efficient. It controls over 60 percent of the manufacturing sector, and the financial sector is also dominated by public banks despite establishment of four private banks in the early 2000s. There are quasi-public groups called bonyads with an additional major involvement the manufacturing and commercial sectors.

In July 2006, the Government announced a major privatization program whereby large, strategic industries mandated to be state-owned by Article 44 of the Constitution could be privatized. These include, among others, oil distribution, utilities, much of the financial sector, industrial and commercial sectors. However, implementation of the program has been hindered by low demand for large public sector assets by the private sector. In order to improve the operational environment for private firms and to enhance private returns to investment, the government launched in 2008 a program of investment climate reforms.

Private sector activity has typically limited to small-scale workshops, farming, and services, , although the bazaari class of merchants has historically been a powerful force in national politics.

President Ahminejad has proposed reforms to Iran's system of price controls and subsidies, particularly on food and energy. However, previous government-led efforts at reform - such as fuel rationing in July 2007 and the imposition of the Value-Added Tax (VAT) in October 2008 - were met with stiff resistance and violent protests.

Significant informal market activity flourishes. Corruption and shortages of goods are widespread, although a certain amount of what would be regarded, in the West, as corruption is customary in the marketplace.

Problems with macroeconomic instability persist in spite of major efforts of the Central Bank, inflation has continued to increase while the government drew down on its Oil Stabilization Fund when oil prices were very high.

According to the World Bank, "A major challenge is how to channel the network of untargeted energy subsides -- amounting to more than 10 percent of gross domestic product (GDP) -- into productive, job-creating, private-sector investment. Another growth constraint is limited access to knowledge and information technology and related infrastructure. " Nevertheless, Iran has some extremely skilled information and technology resources. Its military sector is largely independent in production of integrated circuits and advanced radar. The Iranian nuclear program clearly is expensive.

Demographics

The majority of Iranians are ethnically Persian. Other ethnic groups, such as Azeris, make up significant minorities of the population.

Culture

See also: Iranian cuisine

Iranian culture is a rich combination of Persian and Arabic influences. Islam plays an important role.

Languages

The main language of Iran is Persian, also called Farsi. Many other languages are spoken by members of different ethnic groups.