Southwest Asia The Middle East FSMS 7th Grade Social Studies; Unit 3 Production, Distribution & Consumption (Economic Systems) October 18th – 19th; Day 32-33 Georgia Standard SS7G7c

The Middle East Production, Distribution & Consumption Standard SS7E5 The student will analyze different economic systems. c. Compare and contrast the economic systems in Israel, Saudi Arabia, Turkey, and Iran.

FIRST FIVE Agenda Message: Pop-Quiz Friday on Economies. Review your Economies Worksheets. Standard: Compare and contrast the economic systems in Israel, Saudi Arabia, Turkey, and Iran. E.Q. Thursday; 11/16/17: Why did Saudi Arabia find it necessary to change its economy? Warm Up: What type of economy do most modern nations in the world have? TODAY WE WILL: Introduction to Economies Comparative SWA Economies

Answers E.Q. Answer for Thursday November 16, 2017: In the 1980’s, realizing that oil wouldn’t last forever, Saudi Arabia saw the need to diversify its economy. Warm-Up: Mixed Market Economy

The Middle East Production, Distribution & Consumption Israel, Saudi Arabia, Turkey, and Iran are very different countries in terms of location, residents, and economic systems. Israel’s Economy Israel is located along Mediterranean coast. It is very small and has almost no natural resources. Israel was founded in 1948 as a homeland for the world’s Jews, and most of the citizens are Jewish.

The Middle East Production, Distribution & Consumption Israel’s Economy cont. Though they have many problems with their Arab neighbors, Israel has good relations with much of Western Europe and with the United States. The Israelis have built an economy based on advanced technology that has allowed them to make up for much of what they lack in farmland and natural resources.

The Middle East Production, Distribution & Consumption Israel’s Economy cont. Israel has faced a double challenge in building a mixed market economy: national security and immigration. Since its creation, Israel has been in conflict with its Arab neighbors and has faced high expenses to build and maintain its armed forces. Economic aid, especially from the United States, helps with the financial burden.

The Middle East Production, Distribution & Consumption The Israeli government plays an important role in economic planning. For example, the government has been heavily involved in agriculture to make sure Israel can feed its citizens. Israel has the most diversified economy in SWA including mining & manufacturing equipment, high- tech equipment to export, cutting and polishing diamonds, and agriculture.

The Middle East Production, Distribution & Consumption Israel’s Economy cont. Since Israel is a popular tourist destination, a high percentage of workers are in service industries (hotels, restaurants, tours, etc.). Even though Israel has a small amount of farmland, it grows most of its own food. Israel’s GDP is approximately $243 billion per year.

The Middle East Production, Distribution & Consumption Saudi Arabia’s Economy Saudi Arabia is one of the largest countries in Southwest Asia, and it is located to the south of Israel on the Arabian Peninsula. Most Saudis are Sunni Muslims, and Saudi Arabia is the location of Mecca, the holiest city for Muslims.

The Middle East Production, Distribution & Consumption Saudi Arabia’s Economy cont. When Saudi Arabia became a nation in 1932, its economy was almost entirely traditional and consisted of selling dates or trading goats, camels, and hand woven rugs. Everything changed when oil was discovered in the mid-1930s! Oil brought tremendous wealth to the Saudi royal family and transformed the entire economy.

The Middle East Production, Distribution & Consumption Saudi Arabia’s Economy cont. The Saudi Arabian economy has been oil-based ever since, with the government controlling most of the industry. The king of Saudi Arabia and his advisors make most of the decisions about how and where to use oil profits. With these oil profits the government can buy most of the goods they cannot produce themselves. Income from oil accounts for 75% of the country’s budget.

The Middle East Production, Distribution & Consumption Saudi Arabia’s Economy cont. In the 1980’s, realizing that oil wouldn’t last forever, Saudi Arabia saw the need to diversify its economy. The government is now encouraging private enterprise in areas such as power generation and natural gas exploration.

The Middle East Production, Distribution & Consumption Saudi Arabia’s Economy cont. As individual businesses grows, Saudi Arabia is moving to a mixed market economy, with 40% of its revenue coming from private businesses. They have invested a lot of the nation’s wealth in new technologies that allow them to produce goods they would not be able to do otherwise in a desert climate. Saudi Arabia’s GDP is $576 billion per year.

The Middle East Production, Distribution & Consumption Iran’s Economy Iran is located across the Persian Gulf from Saudi Arabia. Iran has great oil wealth, like Saudi Arabia. However they have much more of a diverse economy based on other products and natural resources. Iran’s command economy has not been very efficient in recent years. Even though there is oil wealth, many Iranians do not share in the wealth. Iran’s GDP is $496 billion per year.

The Middle East Production, Distribution & Consumption Turkey’s Economy Turkey is located in the northwestern part of the Middle East. Turkey has historically had a command economy and the least amount of economic freedom of the four countries. Reforms made in Turkey since the 1980’s have moved it toward a mixed market economy.

The Middle East Production, Distribution & Consumption Turkey’s Economy cont. When Turkey was established as a republic in 1923, its rulers believe that the government should control and build the economy. The government invested in the country’s infrastructure: dams, electrical grids, port facilities, railways, and roads. Turkey also developed important steel and weapons industries.

The Middle East Production, Distribution & Consumption Turkey’s Economy cont. The government still has a major role in banking, transportation, and communication, but private businesses are also growing in agriculture, textiles, and manufacturing. Turkey is going through a process of modernization.

The Middle East Production, Distribution & Consumption Turkey’s Economy cont. Turkey is considered a developing nation and remains poor when compared to most European countries. Because most of its trade is with Western Europe, Turkey is trying to join the European Union (EU).

The Middle East Production, Distribution & Consumption Turkey’s Economy cont. The EU is a powerful confederation of European countries united for economic strength. Joining the EU would provide necessary funding and loans for further modernization and other benefits. Turkey’s GDP is $773 billion per year.

FIRST FIVE Agenda Message: Pop-Quiz on Economies TODAY! Enjoy your Thanksgiving Break! Standard: Compare and contrast the economic systems in Israel, Saudi Arabia, Turkey, and Iran. E.Q. Friday; 11/17/17: Reforms in Turkey have led it towards what type of economy? Warm Up: Why do societies need economies? TODAY WE WILL: Pop-Quiz E.Q.’s & Warm-Ups

ANSWERS Mixed Market Economy E.Q. Answer for Friday November 17, 2017: Warm-Up: All societies must provide goods and services for its people. Societies must do so while dealing with limited resources. Economies help societies manage their limited resources so they can provide goods and services.