Despite intermittent government efforts to develop the sector, agricultural production has always been a modest contributor to Iraq's economy, accounting for 7 percent of GDP prior to the 1980 Iran-Iraq war and 6 percent in 1993. Despite declining performance, however, the sector continues to employ almost one-third of the country's labor force . The agricultural sector employed 30 percent of the labor force in 1989, and although the number is believed to have declined as a result of the sector's declining performance, no hard figures are available to support this contention.
Iraq's arable land is estimated at 8 million hectares, comprising less than 15 percent of the country's total area. However, only 4 to 5 million hectares of this land is being cultivated. Arable land is mostly concentrated in the north and northeast, where winter crops—mainly wheat and barley—are grown, and in the valleys of the Tigris and Euphrates rivers.
The sector's contribution to the GDP has steadily declined since the early 1980s, despite repeated government efforts to boost agricultural production. Until the late 1980s, cultivable land was under the control of the state, the direct result of the land reforms begun in 1958. In 1988-89, in an effort to boost agricultural production, the state privatized agriculture, but the sector's weakness persisted. Further, the government continued to control the price of agricultural products, mainly to protect the urban consumer. Despite government efforts to encourage agricultural production after the Gulf War by raising the price of staple foods—especially of wheat, barley and rice—the labor-intensive sector remains in 2001 under-developed and inefficient, as a result of the high costs of energy, credit, and land and lack of investment. The problem is further aggravated by the lack of pesticides, fertilizers, and machinery. Further, competition from produce and agriculture products imported under the UN food-for-oil program, which allows the sale of a given amount of oil in return for basic foodstuffs and medicine, has also hurt the sector. In 2000, Iraq's farmers were also hit hard by the worst drought in a century. This drought devastated output and forced many farmers to ask the government to loan them the money to pay local banks back for funds they had borrowed to plant their crops, which in the summer of 2000 were failing.
Major agricultural products are cereals, including wheat and barley. Iraq is also a producer of dates, sheep and goat meat, chicken meat, and milk. Most agricultural activity is concentrated in the fertile lowlands in the Mesopotamian plains irrigated from the Tigris and the Euphrates. The Kurdish areas in the north, which have received minimal attention due to the conflict between the central government and the Kurds, remain underdeveloped and mostly dependent on rainwater. Agricultural production in Kurdish areas has improved under the UN sanctions regime, due to the distribution of fertilizers and spare parts by international agencies in those areas.