Economic overview Iraq, in 36 editions.

The Bathist regime engages in extensive central planning and management of industrial production and foreign trade while leaving some small-scale industry and services and most agriculture to private enterprise. The economy is has been dominated by the oil sector, which provides has provided about 95% of foreign exchange earnings. Since In the early 1980s financial problems, caused by war massive expenditures in the eight-year war with Iran and damage to oil export facilities by Iran, have led the government to implement austerity measures and to borrow heavily and later reschedule foreign debt payments. Oil After the end of hostilities in 1988, oil exports have gradually increased with the construction of new pipelines. pipelines and restoration of damaged facilities. Agricultural development remains remained hampered by labor shortages, salinization, and dislocations caused by previous land reform and collectivization programs. The industrial sector, although accorded high priority by the government, is also was under financial constraints. New investment funds are generally allocated only to projects that result Iraq's seizure of Kuwait in import substitution or foreign exchange earnings. August 1990, subsequent international economic embargoes, and military actions by an international coalition beginning in January 1991 drastically changed the economic picture. Oil exports were cut to near zero, and industrial and transportation facilities severely damaged.

The Bathist Ba`thist regime engages in extensive central planning and management of
industrial production and foreign trade while leaving some small-scale
industry and services and most agriculture to private enterprise. The
economy has been dominated by the oil sector, which has provided about 95%
of foreign exchange earnings. In the 1980s financial problems, caused by
massive expenditures in the eight-year war with Iran and damage to oil
export facilities by Iran, led the government to implement austerity
measures and to borrow heavily and later reschedule foreign debt payments.
After the end of hostilities in 1988, oil exports gradually increased with
the construction of new pipelines and restoration of damaged facilities.
Agricultural development remained hampered by labor shortages, salinization,
and dislocations caused by previous land reform and collectivization
programs. The industrial sector, although accorded high priority by the
government, also was under financial constraints. Iraq's seizure of Kuwait
in August 1990, subsequent international economic embargoes, and military
actions by an international coalition beginning in January 1991 drastically
changed the economic picture. Oil exports were cut to near zero, and
industrial and transportation facilities were severely damaged. Throughout
1991, the UN's economic embargo worked to reduce exports and imports and to
increase prices for most goods. The government's policy to allocate goods to
key supporters of the regime exacerbated shortages.

The Ba`thist Ba'thist regime engages in extensive central planning and management of
industrial production and foreign trade while leaving some small-scale
industry and services and most agriculture to private enterprise. The
economy has been dominated by the oil sector, which has traditionally
provided about 95%
of foreign exchange earnings. In the 1980s 1980s, financial problems,
problems caused by
massive expenditures in the eight-year war with Iran and
damage to oil
export facilities by Iran, led the government to implement austerity
austerity measures and to borrow heavily and later reschedule foreign debt payments.
payments. After the end of hostilities in 1988, oil exports gradually
increased with
the construction of new pipelines and restoration of damaged facilities.
facilities. Agricultural development remained hampered by labor shortages, salinization,
salinization, and dislocations caused by previous land reform and collectivization
collectivization programs. The industrial sector, although accorded high
priority by the
government, also was under financial constraints. Iraq's
seizure of Kuwait
in August 1990, subsequent international economic
embargoes, and military
actions action by an international coalition beginning in
January 1991 drastically
changed the economic picture. Oil exports were cut to near zero, Industrial and
industrial and transportation facilities were severely damaged. Throughout suffered severe damage and have been only
1991, partially restored. Oil exports remain at less than 10% of the UN's previous
level. Shortages of spare parts continue. Living standards deteriorated even
further in 1992 and early 1993; consumer prices at least tripled in 1992.
The UN-sponsored economic embargo worked to reduce has reduced exports and imports and to has
increase prices for most goods. contributed to the sharp rise in prices. The government's policy to allocate goods to policies of
supporting large military and internal security forces and of allocating
resources to key supporters of the regime have exacerbated shortages. In
brief, per capita output in early 1993 is far below the 1989-90 level, but
no reliable estimate is available.

The Ba'thist regime engages in extensive central planning and
management of
industrial production and foreign trade while leaving
some small-scale
industry and services and most agriculture to private
enterprise. The
economy has been dominated by the oil sector, which
has traditionally
provided about 95% of foreign exchange earnings. In
the 1980s, financial
problems caused by massive expenditures in the
eight-year war with Iran and
damage to oil export facilities by Iran,
led the government to implement
austerity measures and to borrow
heavily and later reschedule foreign debt
payments. After the end of
hostilities in 1988, oil exports gradually
increased with the
construction of new pipelines and restoration of damaged
facilities.
Agricultural development remained hampered by labor shortages,
salinization, and dislocations caused by previous land reform and
collectivization programs. The industrial sector, although accorded high
high priority by the government, also was under financial constraints. Iraq's
Iraq's seizure of Kuwait in August 1990, subsequent international economic
economic embargoes, and military action by an international coalition
beginning in
January 1991 drastically changed the economic picture.
Industrial and
transportation facilities suffered severe damage and
have been only
partially restored. Oil exports remain at less than 10%
of the previous
level. Shortages of spare parts continue. Living
standards deteriorated even
further in 1992 1993 and early 1993; 1994; consumer
prices at least tripled in 1992.
1993. The UN-sponsored economic embargo has
reduced exports and imports and has
contributed to the sharp rise in
prices. The government's policies of
supporting large military and
internal security forces and of allocating
resources to key supporters
of the regime have exacerbated shortages. In
brief, per capita output
in early 1993 1993-94 is far below the 1989-90 level, but
no reliable precise estimate is
available.

The Ba'thist regime engages in extensive central planning and
and management of industrial production and foreign trade while leaving
leaving some small-scale industry and services and most agriculture to private
private enterprise. The economy has been dominated by the oil sector, which
which has traditionally provided about 95% of foreign exchange
earnings. In
the 1980s, financial problems caused by massive
expenditures in the
eight-year war with Iran and damage to oil export
facilities by Iran,
led the government to implement austerity measures
and to borrow
heavily and later reschedule foreign debt payments.
After the end of
hostilities in 1988, oil exports gradually increased
with the
construction of new pipelines and restoration of damaged facilities.
facilities. Agricultural development remained hampered by labor shortages,
shortages, salinization, and dislocations caused by previous land
reform and
collectivization programs. The industrial sector, although accorded
accorded high priority by the government, also was under financial constraints.
constraints. Iraq's seizure of Kuwait in August 1990, subsequent international
international economic embargoes, and military action by an
international coalition
beginning in January 1991 drastically changed
the economic picture.
Industrial and transportation facilities facilities, which
suffered severe damage and
damage, have been only partially restored. Oil exports
remain at less than 10%
5% of the previous level. Shortages of spare parts
continue. Living
standards deteriorated even further in 1993 and early 1994; consumer
consumer prices at least tripled have more than doubled in 1993. both 1993 and 1994. The
UN-sponsored economic embargo has
reduced exports and imports and has
contributed to the sharp rise in
prices. The Iraqi government has been
unwilling to abide by UN resolutions so that the economic embargo can
be removed. The government's policies of supporting large military and
internal security forces and of allocating resources to key supporters
of the regime have exacerbated shortages. In brief, per capita output
in 1993-94 is far below the 1989-90 level, but no precise estimate is
available.

The Ba'thist regime engages in extensive
central planning
and management of industrial production and foreign
trade while
leaving some small-scale industry and services and most
agriculture to
private enterprise. The economy has been dominated by
the oil sector,
which has traditionally provided about 95% of
foreign exchange
earnings. In the 1980s, financial problems caused
by massive
expenditures in the eight-year war with Iran and damage
to oil export
facilities by Iran, led the government to implement
austerity measures
and to borrow heavily and later reschedule
foreign debt payments. payments; Iraq suffered economic losses of at least
$100 billion from the war. After the end of hostilities in 1988, oil
exports gradually increased
with the construction of new pipelines
and restoration of damaged
facilities. Agricultural development
remained hampered by labor
shortages, salinization, and dislocations
caused by previous land
reform and collectivization programs. The
industrial sector, although
accorded high priority by the
government, also was under financial
constraints. Iraq's seizure of
Kuwait in August 1990, subsequent
international economic embargoes,
and military action by an
international coalition beginning in
January 1991 drastically changed
the economic picture. Industrial
and transportation facilities, which
suffered severe damage, have
been partially restored. Oil exports
remain at less than 5% of the
previous level. Shortages of spare parts
continue. Living standards
deteriorated even further in 1993 1994 and 1994;
1995; consumer prices have
more than doubled in both 1993 1994 and 1994. 1995. The
UN-sponsored economic
embargo has reduced exports and imports and has
contributed to the
sharp rise in prices. The Iraqi government Government has been
unwilling to
abide by UN resolutions so that the economic embargo can
be removed.
The government's policies of supporting large military and
internal
security forces and of allocating resources to key supporters
of the
regime have exacerbated shortages. In brief, per capita output for
in 1993-94 1994-95 is far well below the 1989-90 level, but no precise any estimate is has a wide
available. range of error.

The Ba'thist regime engages in extensive
central
planning and management of industrial production and foreign
trade
while leaving some small-scale industry and services and most
agriculture to private enterprise. The economy has been dominated by
the oil sector, which has traditionally provided about 95% of
foreign
exchange earnings. In the 1980s, financial problems caused
by massive
expenditures in the eight-year war with Iran and damage
to oil export
facilities by Iran, led the government to implement
austerity measures
and to borrow heavily and later reschedule
foreign debt payments; Iraq
suffered economic losses of at least
$100 billion from the war. After
the end of hostilities in 1988, oil
exports gradually increased with
the construction of new pipelines
and restoration of damaged
facilities. Agricultural development
remained hampered by labor
shortages, salinization, and dislocations
caused by previous land
reform and collectivization programs. The
industrial sector, although
accorded high priority by the
government, also was under financial
constraints. Iraq's seizure of
Kuwait in August 1990, subsequent
international economic embargoes,
and military action by an
international coalition beginning in
January 1991 drastically changed
the economic picture. Industrial
and transportation facilities, which
suffered severe damage, have
been partially restored. Oil exports remain are
at less than 5% 25% of the prewar level following the implementation of UN Security
previous level. Council Resolution 986 in December 1996. Shortages of spare parts continue. Living standards
deteriorated even further in 1994 and 1995; consumer prices have
more than doubled in both 1994 and 1995. continue. The UN-sponsored economic
embargo has reduced exports and
imports and has contributed to the
sharp rise in prices. The Iraqi
Government has been unwilling to
abide by UN resolutions so that the
economic embargo can could be removed.
The government's policies of
supporting large military and internal
security forces and of
allocating resources to key supporters of the
regime have exacerbated
shortages. In brief, per accord with a UN resolution Iraq agreed to an
oil-for-food deal in 1996, under which it would export $2 billion
worth of oil in exchange for badly needed food and medicine. The first
oil was pumped in December 1996, and the first supplies of food and
medicine should arrive in March 1997. Per capita output for 1995-96
1994-95 is and living standards are well below the 1989-90 level, but any estimate has
estimates have a wide
range of error.

The Ba'thist regime engages in extensive central
planning and management of industrial production and foreign trade
while leaving some small-scale industry and services and most
agriculture to private enterprise. The economy has been dominated by
the oil sector, which has traditionally provided about 95% of foreign
exchange earnings. In the 1980s, financial problems caused by massive
expenditures in the eight-year war with Iran and damage to oil export
facilities by Iran, Iran led the government to implement austerity measures
and to borrow heavily and later reschedule foreign debt payments; Iraq
suffered economic losses of at least $100 billion from the war. After
the end of hostilities in 1988, oil exports gradually increased with
the construction of new pipelines and restoration of damaged
facilities. Agricultural development remained hampered by labor
shortages, salinization, and dislocations caused by previous land
reform and collectivization programs. The industrial sector, although
accorded high priority by the government, also was under financial
constraints. Iraq's seizure of Kuwait in August 1990, subsequent
international economic embargoes, and military action by an
international coalition beginning in January 1991 drastically changed
the economic picture. Industrial and transportation facilities, which
suffered severe damage, have been partially restored. Oil exports are
at 25% of the prewar level following the implementation of UN Security
Council Resolution 986 in December 1996. Shortages of spare parts
continue. The UN-sponsored economic embargo has reduced
exports and
imports and has contributed to the sharp rise in prices.
The Iraqi
Government has been unwilling to abide by UN resolutions so
that the
economic embargo could be removed. The government's policies of
of supporting large military and internal security forces and of
allocating resources to key supporters of the regime have exacerbated
shortages. Industrial and transportation facilities, which suffered
severe damage, have been partially restored. At current prices, oil
exports are about one-third of their prewar level because of the
implementation of UN Security Council Resolution 986-the UN's
oil-for-goods program-in December 1996. Shortages of spare parts
continue. In accord with a UN resolution the oil-for-goods deal, Iraq agreed is allowed to an
oil-for-food deal in 1996, under which it would export $2 billion
worth of oil in exchange for badly needed food and
medicine. The first
oil was pumped in December 1996, and the first
supplies of food and
medicine should arrive arrived in March April 1997. Per capita output for 1995-96
for 1995-97 and living standards are well below the 1989-90 level, but any
any estimates have a wide range of error.

The Ba'thist regime engages in extensive central
planning and management of industrial production and foreign trade
while leaving some small-scale industry and services and most
agriculture to private enterprise. The Iraq's economy has been dominated by
the oil
sector, which has traditionally provided about 95% of foreign
exchange earnings. In the 1980s, financial problems caused by massive
massive expenditures in the eight-year war with Iran and damage to
oil export
facilities by Iran led the government to implement austerity measures
and to austerity measures, borrow heavily heavily, and later reschedule foreign
debt payments; Iraq
suffered economic losses of at least $100
billion from the war. After
the end of hostilities in 1988, oil
exports gradually increased with
the construction of new pipelines
and restoration of damaged
facilities. Agricultural development remained hampered by labor
shortages, salinization, and dislocations caused by previous land
reform and collectivization programs. The industrial sector, although
accorded high priority by the government, also was under financial
constraints. Iraq's seizure of Kuwait in
August 1990, subsequent
international economic embargoes, and
military action by an
international coalition beginning in January
1991 drastically changed
the economic picture. The UN-sponsored economic embargo has reduced
exports and imports economic activity and has contributed to the sharp rise in increased prices.
The
Iraqi Government has been unwilling to abide by UN resolutions so
that the economic embargo could be removed. The government's policies
policies of supporting large military and internal security forces
and of
allocating resources to key supporters of the regime have exacerbated
exacerbated shortages. Industrial and transportation facilities, which suffered
severe damage, have been partially restored. At current prices, oil
exports are about one-third of their prewar level because of the
The implementation of UN Security Council Resolution 986-the the UN's oil-for-food
oil-for-goods program-in program in December 1996. Shortages of spare parts 1996 has helped improve economic conditions. For
continue. In accord with the oil-for-goods deal, first three six-month phases of the program, Iraq is was allowed to
export $2 billion worth of oil in exchange for badly needed food food, medicine, and
medicine. other humanitarian goods. The first UN allowed Iraq to export $5.2 billion
of oil was pumped beginning with the fourth phase of the program in December 1996, and May 1998.
At an average volume of 1.9 million barrels per day during the first last
supplies half of 1998, oil exports are about three-quarters their prewar
level. Per capita food imports have increased significantly, while
medical supplies and medicine arrived in April 1997. health care services are steadily improving.
Per capita output
for 1995-97 and living standards are still well below the 1989-90
prewar level, but
any estimates have a wide range of error.

Iraq's economy has been is dominated by the oil
sector, which has traditionally provided about 95% of foreign
exchange earnings. In the 1980s, financial problems caused by
massive expenditures in the eight-year war with Iran and damage to
oil export facilities by Iran led the government to implement
austerity measures, borrow heavily, and later reschedule foreign
debt payments; Iraq suffered economic losses of at least $100
billion from the war. After the end of hostilities in 1988, oil
exports gradually increased with the construction of new pipelines
and restoration of damaged facilities. Iraq's seizure of Kuwait in
August 1990, subsequent international economic embargoes, sanctions, and
damage from military action by an international coalition beginning in January
1991 drastically reduced economic activity and increased prices. The
Iraqi Government has been unwilling to abide by UN resolutions so
that the economic embargo could be removed. activity. The government's
policies of supporting large military and internal security forces
and of allocating resources to key supporters of the regime have
exacerbated shortages. The implementation of the UN's oil-for-food
program in December 1996 has helped improve economic conditions. For
the first three six six-month phases of the program, Iraq was allowed to
export $2 billion worth limited amounts of oil in exchange for food, medicine, and
other humanitarian goods. The In December 1999, the UN allowed Security Council authorized Iraq to export $5.2 billion
of oil beginning with the fourth phase of under the oil-for-food program in May 1998.
At an average volume of 1.9 million barrels per day during the last
half of 1998, as much oil as required to meet humanitarian needs. Oil exports are now about three-quarters their prewar
level. Per capita food imports have increased significantly, while
medical supplies and health care services are steadily improving.
Per capita output and living standards are still well below the
prewar level, but any estimates have a wide range of error.

Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. In the 1980s, financial problems caused by massive expenditures in the eight-year war with Iran and damage to oil export facilities by Iran led the government to implement austerity measures, borrow heavily, and later reschedule foreign debt payments; Iraq suffered economic losses of at least $100 billion from the war. After the end of hostilities in 1988, oil exports gradually increased with the construction of new pipelines and restoration of damaged facilities. Iraq's seizure of Kuwait in August 1990, subsequent international economic sanctions, and damage from military action by an international coalition beginning in January 1991 drastically reduced economic activity. The government's Although government policies of supporting large military and internal security forces and of allocating resources to key supporters of the regime have exacerbated shortages. The hurt the economy, implementation of the UN's oil-for-food program in December 1996 has helped improve economic conditions. conditions for the average Iraqi citizen. For the first six six, six-month phases of the program, Iraq was allowed to export limited amounts of oil in exchange for food, medicine, and other humanitarian goods. some infrastructure spare parts. In December 1999, the UN Security Council authorized Iraq to export under the oil-for-food program as much oil as required to meet humanitarian needs. Oil exports are now about more than three-quarters their prewar level. Per capita food imports have increased significantly, while medical supplies and health care services are steadily improving. Per capita output and living standards are still well below the prewar level, but any estimates have a wide range of error.

Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. In the 1980s, 1980s financial problems caused by massive expenditures in the eight-year war with Iran and damage to oil export facilities by Iran led the government to implement austerity measures, borrow heavily, and later reschedule foreign debt payments; Iraq suffered economic losses from the war of at least $100 billion from the war. billion. After the end of hostilities ended in 1988, oil exports gradually increased with the construction of new pipelines and restoration of damaged facilities. Iraq's seizure of Kuwait in August 1990, subsequent international economic sanctions, and damage from military action by an international coalition beginning in January 1991 drastically reduced economic activity. Although government policies supporting large military and internal security forces and allocating resources to key supporters of the regime have hurt the economy, implementation of the UN's oil-for-food program in December 1996 has helped improve conditions for the average Iraqi citizen. For the first six, six-month phases of the program, Iraq was allowed to export limited amounts of oil in exchange for food, medicine, and some infrastructure spare parts. In December 1999, 1999 the UN Security Council authorized Iraq to export under the program as much oil as required to meet humanitarian needs. Oil exports are now more than three-quarters their prewar level. However, 28% of Iraq's export revenues under the program are deducted to meet UN Compensation Fund and UN administrative expenses. The drop in GDP in 2001 was largely the result of the global economic slowdown and lower oil prices. Per capita food imports have increased significantly, while medical supplies and health care services are steadily improving. Per capita output and living standards are still well below the prewar level, but any estimates have a wide range of error.

Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. In the 1980s financial problems caused by massive expenditures in the eight-year war with Iran and damage to oil export facilities by Iran led the government to implement austerity measures, borrow heavily, and later reschedule foreign debt payments; Iraq suffered economic losses from the war of at least $100 billion. After hostilities ended in 1988, oil exports gradually increased with the construction of new pipelines and restoration of damaged facilities. Iraq's seizure of Kuwait in August 1990, subsequent international economic sanctions, and damage from military action by an international coalition beginning in January 1991 drastically reduced economic activity. Although government policies supporting large military and internal security forces and allocating resources to key supporters of the regime have hurt the economy, implementation of the UN's oil-for-food program beginning in December 1996 has helped improve conditions for the average Iraqi citizen. For the first six, six-month phases of the program, Iraq was allowed to export limited amounts of oil in exchange for food, medicine, and some infrastructure spare parts. In December 1999 the UN Security Council authorized Iraq to export under the program as much oil as required to meet humanitarian needs. Oil exports are now have recently been more than three-quarters prewar level. However, 28% of Iraq's export revenues under the program are have been deducted to meet UN Compensation Fund and UN administrative expenses. The drop in GDP in 2001 2001-02 was largely the result of the global economic slowdown and lower oil prices. Per capita food imports have increased significantly, while medical supplies and health care services are steadily improving. improved. Per capita output and living standards are were still well below the prewar level, but any estimates have a wide range of error. The military victory of the US-led coalition in March-April 2003 resulted in the shutdown of much of the central economic administrative structure and the loss of a comparatively small amount of capital plant.

Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. In the 1980s financial problems caused by massive expenditures in the eight-year war with Iran and damage to oil export facilities by Iran led the government to implement austerity measures, borrow heavily, and later reschedule foreign debt payments; Iraq suffered economic losses from the that war of at least $100 billion. After hostilities ended in 1988, oil exports gradually increased with the construction of new pipelines and restoration of damaged facilities. Iraq's seizure of Kuwait in August 1990, subsequent international economic sanctions, and damage from military action by an international coalition beginning in January 1991 drastically reduced economic activity. Although government policies supporting large military and internal security forces and allocating resources to key supporters of the regime have hurt the economy, implementation of the UN's oil-for-food program beginning in December 1996 helped improve conditions for the average Iraqi citizen. Iraq was allowed to export limited amounts of oil in exchange for food, medicine, and some infrastructure spare parts. In December 1999 1999, the UN Security Council authorized Iraq to export under the program as much oil as required to meet humanitarian needs. Oil exports have recently been more than three-quarters prewar level. However, 28% of Iraq's export revenues under the program have been deducted to meet UN Compensation Fund and UN administrative expenses. The drop in GDP in 2001-02 was largely the result of the global economic slowdown and lower oil prices. Per capita food imports increased significantly, while medical supplies and health care services steadily improved. Per capita output and living standards were still well below the prewar pre-1991 level, but any estimates have a wide range of error. The military victory of the US-led coalition in March-April 2003 resulted in the shutdown of much of the central economic administrative structure and structure, but with the loss of a comparatively small amount of capital plant. The rebuilding of oil, electricity, and other production is proceeding steadily at the start of 2004 with foreign support and despite the continuation of severe internal strife. A joint UN and World Bank report released in the fall of 2003 estimated that Iraq's key reconstruction needs through 2007 would cost $55 billion. In October 2003, international donors pledged assistance worth more than $33 billion toward this rebuilding effort.

Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. In the 1980s financial problems caused by massive expenditures in the eight-year war with Iran and damage to oil export facilities by Iran led the government to implement austerity measures, borrow heavily, and later reschedule foreign debt payments; Iraq suffered economic losses from that war of at least $100 billion. After hostilities ended in 1988, oil exports gradually increased with the construction of new pipelines and restoration of damaged facilities. Iraq's seizure of Kuwait in August 1990, subsequent international economic sanctions, and damage from military action by an international coalition beginning in January 1991 drastically reduced economic activity. Although government policies supporting large military and internal security forces and allocating resources to key supporters of the regime have hurt the economy, implementation of the UN's oil-for-food program beginning in December 1996 helped improve conditions for the average Iraqi citizen. Iraq was allowed to export limited amounts of oil in exchange for food, medicine, and some infrastructure spare parts. In December 1999, the UN Security Council authorized Iraq to export under the program as much oil as required to meet humanitarian needs. The drop in GDP in 2001-02 was largely the result of the global economic slowdown and lower oil prices. Per capita food imports increased significantly, while medical supplies and health care services steadily improved. Per capita output and living standards were still well below the pre-1991 level, but any estimates have a wide range of error. The military victory of the US-led coalition in March-April 2003 resulted in the shutdown of much of the central economic administrative structure, but with the loss of structure. Although a comparatively small amount of capital plant. The rebuilding of oil, electricity, and other production is proceeding steadily at plant was damaged during the start of 2004 with foreign support hostilities, looting, insurgent attacks, and despite sabotage have undermined efforts to rebuild the continuation of severe internal strife. A joint UN economy. Despite continuing political uncertainty, the Iraqi Interim Government (IG) has founded the institutions needed to implement economic policy, and World Bank report released has successfully concluded a debt reduction agreement with the Paris Club. The high percentage gain estimated for GDP in 2004 is the fall result of 2003 estimated that Iraq's key reconstruction needs through 2007 would cost $55 billion. In October 2003, international donors pledged assistance worth more than $33 billion toward this rebuilding effort. starting from a low base.

Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. Iraq's seizure of Kuwait in August 1990, subsequent international economic sanctions, and damage from military action by an international coalition beginning in January 1991 drastically reduced economic activity. Although government policies supporting large military and internal security forces and allocating resources to key supporters of the regime hurt the economy, implementation of the UN's oil-for-food program beginning program, which began in December 1996 1996, helped improve conditions for the average Iraqi citizen. Iraq was allowed to export limited amounts of oil in exchange for food, medicine, and some infrastructure spare parts. In December 1999, the UN Security Council authorized Iraq to export under the program as much oil as required to meet humanitarian needs. The drop in GDP in 2001-02 was largely the result of the global economic slowdown and lower oil prices. Per capita food imports increased significantly, while medical supplies and health care services steadily improved. Per capita output and living standards were still well below the pre-1991 level, but any estimates have a wide range of error. The military victory of the US-led coalition in March-April 2003 resulted in the shutdown of much of the central economic administrative structure. Although a comparatively small amount of capital plant was damaged during the hostilities, looting, insurgent attacks, and sabotage have undermined efforts to rebuild the economy. Attacks on key economic facilities - especially oil pipelines and infrastructure - have prevented Iraq from reaching projected export volumes, but total government revenues have been higher than anticipated due to high oil prices. Despite continuing political uncertainty, the Iraqi Interim Government (IG) Iraq has founded established the institutions needed to implement economic policy, and has successfully concluded a three-stage debt reduction agreement with the Paris Club. The high percentage gain estimated for GDP in 2004 Club, and is working toward a Standby Arrangement with the result of starting IMF. The Standby Arrangement would clear the way for continued debt relief from a low base. the Paris Club.

Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. Iraq's seizure of Kuwait in August 1990, subsequent international economic sanctions, and damage from military action by an international coalition beginning in January 1991 drastically reduced economic activity. Although government policies supporting large military and internal security forces and allocating resources to key supporters of the regime hurt the economy, implementation of the UN's oil-for-food program, which began in December 1996, helped improve conditions for the average Iraqi citizen. Iraq was allowed to export limited amounts of oil in exchange for food, medicine, and some infrastructure spare parts. In December 1999, the UN Security Council authorized Iraq to export under the program as much oil as required to meet humanitarian needs. Per capita food imports increased significantly, while medical supplies and health care services steadily improved. Per capita output and living standards were still well below the pre-1991 level, but any estimates have a wide range of error. The military victory of the US-led coalition in March-April 2003 resulted in the shutdown of much of the central economic administrative structure. Although a comparatively small amount of capital plant was damaged during the hostilities, looting, insurgent attacks, and sabotage have undermined efforts to rebuild the economy. Attacks on key economic facilities - especially oil pipelines and infrastructure - have prevented Iraq from reaching projected export volumes, but total government revenues have been higher than anticipated due to high oil prices. Despite political uncertainty, Iraq has established is making some progress in building the institutions needed to implement economic policy, policy and has successfully concluded negotiated a three-stage debt reduction agreement with the Paris Club, Club and is working toward a Standby Arrangement with the IMF. The Standby Arrangement would clear An International Compact with Iraq is being established to integrate Iraq into the way for continued debt relief from regional and global economy, while recognizing the Paris Club. need to resolve destabilizing security and political conflicts. Additionally, the Iraqi government is seeking to pass laws to strengthen the economy; this legislation includes a hydrocarbon law to encourage contracting with foreign investors and a revenue sharing law to equitably divide oil revenues within the nation. Controlling inflation, reducing corruption, and implementing structural reforms such as bank restructuring and developing the private sector, will be key to Iraq's economic prospects.

Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. Iraq's seizure of Kuwait in August 1990, subsequent international economic sanctions, and damage from military action by an international coalition beginning in January 1991 drastically reduced economic activity. Although government policies supporting large military and internal security forces and allocating resources to key supporters of the regime hurt the economy, implementation of the UN's oil-for-food program, which began in December 1996, helped improve conditions for the average Iraqi citizen. Iraq was allowed to export limited amounts of oil in exchange for food, medicine, and some infrastructure spare parts. In December 1999, the UN Security Council authorized Iraq to export under the program as much oil as required to meet humanitarian needs. The military victory of the US-led coalition in March-April 2003 resulted in the shutdown of much of the central economic administrative structure. Although a comparatively small amount of capital plant was damaged during the hostilities, looting, insurgent attacks, and sabotage have undermined efforts economy rebuilding efforts, economic activity is beginning to rebuild pick up in areas recently secured by the economy. Attacks on key economic facilities - especially oil pipelines US military surge. Oil exports are around levels seen before Operation Iraqi Freedom, and infrastructure - have prevented Iraq from reaching projected export volumes, but total government revenues have been higher than anticipated due to benefited from high oil prices. Despite political uncertainty, Iraq is making some progress in building the institutions needed to implement economic policy and has negotiated a debt reduction agreement with the Paris Club and a Standby new Stand-By Arrangement with the IMF. An Iraq has received pledges for $13.5 billion in foreign aid for 2004-07 from outside of the US, more than $33 billion in total pledges. The International Compact with Iraq is being was established in May 2007 to integrate Iraq into the regional and global economy, while recognizing the need to resolve destabilizing security and political conflicts. Additionally, the Iraqi government is seeking to pass laws to strengthen the economy; this its economy. This legislation includes a hydrocarbon law to encourage contracting with foreign investors establish a modern legal framework to allow Iraq to develop its resources and a revenue sharing law to equitably divide oil revenues within the nation. Controlling inflation, reducing corruption, nation, although both are still bogged down in discussions. The Central Bank has been successful in controlling inflation through appreciation of the dinar against the US dollar. Reducing corruption and implementing structural reforms reforms, such as bank restructuring and developing the private sector, will be key to Iraq's economic prospects. success.

Decreasing insurgent attacks and an improving security environment in many parts of the country are helping to spur economic activity. Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% over 90% of foreign exchange earnings. Although looting, insurgent attacks, and sabotage have undermined economy rebuilding efforts, economic activity is beginning to pick up in areas recently secured by the US military surge. Oil exports are around levels seen before Operation Iraqi Freedom, and total Freedom. Total government revenues have benefited from high oil prices. Despite political uncertainty, prices in recent years; however, revenues have declined significantly since the oil price drop in fall 2008. Iraq is making some progress in building the institutions needed to implement economic policy and has negotiated a debt reduction agreement with the Paris Club and policy. In March 2009 Iraq concluded a new Stand-By Arrangement (SBA) with the IMF. Iraq has received pledges for $13.5 billion in foreign aid for 2004-07 from outside IMF that details economic reforms. The SBA allows an 80% reduction of the US, more than $33 billion in total pledges. debt owed to Paris Club creditor nations. The International Compact with Iraq was established in May 2007 to integrate Iraq into the regional and global economy, and the Iraqi government is seeking to pass laws to strengthen its economy. This legislation includes a hydrocarbon law to establish a modern legal framework to allow Iraq to develop its resources and a revenue sharing law to equitably divide oil revenues within the nation, although both are still bogged down under contentious political negotiation. Some foreign entities have expressed interest in discussions. reinvigorating Iraq's industrial sector. The government of Iraq is pursuing a strategy to gain foreign participation in joint ventures with State-owned enterprises. Provincial Councils are also using their own budgets to promote and facilitate investment at the local level. The Central Bank has been successful in controlling inflation through appreciation of the dinar against the US dollar. However, Iraq's challenge will be to use macroeconomic gains to improve the lives of ordinary Iraqis. Reducing corruption and implementing structural reforms, such as bank restructuring and developing the private sector, will be key to Iraq's economic success.

An improved security environment and an initial wave of foreign investment are helping to spur economic activity, particularly in the energy, construction, and retail sectors. Broader economic improvement, long-term fiscal health, and sustained increases in the standard of living still depend on the government passing major policy reforms and on continued development of Iraq's massive oil reserves. Although foreign investors viewed Iraq with increasing interest in 2010, most are still hampered by difficulties in acquiring land for projects and by other regulatory impediments. Iraq's economy is dominated by the oil sector, which provides over 90% of government revenue and 80% of foreign exchange earnings. Since mid-2009, oil export earnings have returned to levels seen before Operation Iraqi Freedom and government revenues have rebounded, along with global oil prices. In 2011 Baghdad probably will increase oil exports above the current level of 1.9 million barrels per day (bbl/day) as a result of new contracts with international oil companies, but is likely to fall short of the 2.4 million bbl/day it is forecasting in its budget. Iraq is making modest progress in building the institutions needed to implement economic policy. In 2010, Bagdad signed a new agreement with both the IMF and World Bank for conditional aid programs that will help strengthen Iraq's economic institutions. Some reform-minded leaders within the Iraqi government are seeking to pass laws to strengthen the economy. This legislation includes a package of laws to establish a modern legal framework for the oil sector and a mechanism to equitably divide oil revenues within the nation, although these and other important reforms are still under contentious and sporadic negotiation. Iraq's recent contracts with major oil companies have the potential to greatly expand oil revenues, but Iraq will need to upgrade its oil processing, pipeling, pipeline, and export infrastructure to enable these deals to reach their potential. The Government of Iraq is pursuing a strategy to gain additional foreign investment in Iraq's economy. This includes an amendment to the National Investment Law, multiple international trade and investment events, as well as potential participation in joint ventures with state-owned enterprises. Provincial Councils also are using their own budgets to promote and facilitate investment at the local level. However, widespread corruption, inadequate infrastructure, insufficient essential services, and antiquated commercial laws and regulations stifle investment and continue to constrain the growth of private, non-energy sectors. The Central Bank has successfully held the exchange rate at approximately 1,170 Iraqi dinar/US dollar since January 2009. Inflation has decreased consistently since 2006 as the security situation has improved. However, Iraqi leaders remain hard pressed to translate macroeconomic gains into improved lives for ordinary Iraqis. Unemployment remains a problem throughout the country. Reducing corruption and implementing reforms - such as bank restructuring and developing the private sector - would be important steps in this direction.

An improved improving security environment and an initial wave of foreign investment are helping to spur economic activity, particularly in the energy, construction, and retail sectors. Broader economic improvement, development, long-term fiscal health, and sustained increases improvements in the overall standard of living still depend on the central government passing major policy reforms and on continued development of Iraq's massive oil reserves. Although foreign investors viewed Iraq with increasing interest in 2010, most are still hampered by difficulties in acquiring land for projects and by other regulatory impediments. reforms. Iraq's largely state-run economy is dominated by the oil sector, which provides over more than 90% of government revenue and 80% of foreign exchange earnings. Since mid-2009, oil export earnings have returned to levels seen before Operation Iraqi Freedom and government revenues have rebounded, along with global oil prices. In 2011 Baghdad probably will increase Iraq in 2012 boosted oil exports above the current level to a 30-year high of 1.9 2.6 million barrels per day (bbl/day) as day, a result significant increase from Iraq's average of new 2.2 million in 2011. Government revenues increased as global oil prices remained persisently high for much of 2012. Iraq's contracts with international major oil companies, companies have the potential to further expand oil exports and revenues, but is likely Iraq will need to fall short of the 2.4 million bbl/day it is forecasting in make significant upgrades to its budget. oil processing, pipeline, and export infrastructure to enable these deals to reach their economic potential. Iraq is making modest slow progress in building enacting laws and developing the institutions needed to implement economic policy. policy, and political reforms are still needed to assuage investors' concerns regarding the uncertain business climate, which may have been harmed by the November 2012 standoff between Baghdad and Erbil. The government of Iraq is eager to attract additional foreign direct investment, but it faces a number of obstacles including a tenuous political system and concerns about security and societal stability. Rampant corruption, outdated infrastructure, insufficient essential services, skilled labor shortages, and antiquated commercial laws stifle investment and continue to constrain growth of private, nonoil sectors. In 2010, Bagdad Baghdad signed a new agreement agreements with both the IMF and World Bank for conditional aid programs that will designed to help strengthen Iraq's economic institutions. Some reform-minded leaders within the Iraqi government are seeking to pass laws to strengthen the economy. This legislation includes Iraq is considering a package of laws to establish a modern legal framework for the oil sector and a mechanism to equitably divide oil revenues within the nation, although these and other important reforms are still under contentious and sporadic negotiation. Iraq's recent contracts with major oil companies have the potential to greatly expand oil revenues, but Iraq will need to upgrade its oil processing, pipeline, Political and export infrastructure to enable these deals to reach their potential. The Government of Iraq is pursuing a strategy to gain additional foreign investment in Iraq's economy. This includes an amendment to the National Investment Law, multiple international trade economic tensions between Baghdad and investment events, as well as potential participation in joint ventures with state-owned enterprises. Provincial Councils also are using local governments have led some provincial councils to use their own budgets to independently promote and facilitate investment at the local level. However, widespread corruption, inadequate infrastructure, insufficient essential services, and antiquated commercial laws and regulations stifle investment and continue to constrain the growth of private, non-energy sectors. The Central Bank has successfully held the exchange rate at approximately about 1,170 Iraqi dinar/US dollar since January 2009. Inflation has decreased consistently remained under control since 2006 as the security situation has improved. However, Iraqi leaders remain hard pressed to translate macroeconomic gains into an improved lives standard of living for ordinary Iraqis. the Iraqi populace. Unemployment remains a problem throughout the country. Reducing country despite a bloated public sector. Encouraging private enterprise through deregulation would make it easier for Iraqi citizens and foreign investors to start new businesses. Rooting out corruption and implementing reforms - such as bank restructuring banks and developing the private sector - would be important steps in this direction.

An improving security environment and foreign investment are helping to spur economic activity, particularly in the energy, construction, and retail sectors. Broader economic development, long-term fiscal health, and sustained improvements in the overall standard of living still depend on the central government passing major policy reforms. Iraq's largely state-run economy is dominated by the oil sector, which provides more than 90% of government revenue and 80% of foreign exchange earnings. Iraq in 2012 boosted oil exports to a 30-year high of 2.6 million barrels per day, a significant increase from Iraq's average of 2.2 million in 2011. Government revenues increased as global oil prices remained persisently persistently high for much of 2012. Iraq's contracts with major oil companies have the potential to further expand oil exports and revenues, but Iraq will need to make significant upgrades to its oil processing, pipeline, and export infrastructure to enable these deals to reach their economic potential. The Iraqi Kurdistan Region's (IKR) autonomous Kurdistan Regional Government (KRG) passed its own oil law in 2007, and has directly signed about 50 contracts to develop IKR energy reserves. The federal government has disputed the legal authority of the KRG to conclude most of these contracts, some of which are also in areas with unresolved administrative boundaries in dispute between the federal and regional government. Iraq is making slow progress enacting laws and developing the institutions needed to implement economic policy, and political reforms are still needed to assuage investors' concerns regarding the uncertain business climate, which may have been harmed by the November 2012 standoff between Baghdad and Erbil. Erbil and the removal of the Central Bank Governor in October 2012. The government of Iraq is eager to attract additional foreign direct investment, but it faces a number of obstacles including a tenuous political system and concerns about security and societal stability. Rampant corruption, outdated infrastructure, insufficient essential services, skilled labor shortages, and antiquated commercial laws stifle investment and continue to constrain growth of private, nonoil sectors. In 2010, Baghdad signed agreements with both the IMF and World Bank for conditional aid programs designed to help strengthen Iraq's economic institutions. Iraq is considering a package of laws to establish a modern legal framework for the oil sector and a mechanism to equitably divide oil revenues within the nation, although these reforms are still under contentious and sporadic negotiation. Political and economic tensions between Baghdad and local governments have led Under the Iraqi Constitution, some provincial councils competencies relevant to use their budgets the overall investment climate are either shared by the federal government and the regions or are devolved entirely to independently promote the regions. Investment in the IKR operates within the framework of the Kurdistan Region Investment Law (Law 4 of 2006) and facilitate investment at the local level. The Central Bank has successfully held Kurdistan Board of Investment, which is designed to provide incentives to help economic development in areas under the exchange rate at about 1,170 Iraqi dinar/US dollar since January 2009. authority of the KRG. Inflation has remained under control since 2006 as security improved. However, Iraqi leaders remain hard pressed to translate macroeconomic gains into an improved standard of living for the Iraqi populace. Unemployment remains a problem throughout the country despite a bloated public sector. Encouraging private enterprise through deregulation would make it easier for Iraqi citizens and foreign investors to start new businesses. Rooting out corruption and implementing reforms - such as restructuring banks and developing the private sector - would be important steps in this direction.

An improving During 2014, worsening security environment and foreign investment are helping to spur economic activity, particularly in the energy, construction, financial stability throughout Iraq - driven by an ongoing insurgency, decreasing oil prices, and retail sectors. Broader political upheaval - decreased the prospects for improving the country's economic development, long-term environment and securing much-needed foreign investment. Long-term fiscal health, a strengthened investment climate, and sustained improvements in the overall standard of living still depend on the central government passing major policy reforms. Iraq's largely state-run economy is dominated by the oil sector, which provides more than 90% of government revenue and 80% of foreign exchange earnings. Iraq in 2012 boosted oil Oil exports to a 30-year high of 2.6 in 2014 remained relatively flat at 2.4 million barrels per day, a significant increase from Iraq's average day on average, despite new production coming online at the West Qurna 2 and Badrah oilfields, because repeated attacks on the Iraq-Turkey pipeline reduced export capacity. During the second half of 2.2 million in 2011. Government 2014, government revenues increased decreased as global oil prices remained persistently high for much of 2012. fell by more than 30%. Iraq's contracts with major oil companies have the potential to further expand oil exports and revenues, but Iraq will need to make significant upgrades to its oil processing, pipeline, and export infrastructure to enable these deals to reach their economic potential. The Iraqi Kurdistan Region's (IKR) autonomous Kurdistan Regional Government (KRG) passed its own oil law in 2007, and has directly signed about 50 contracts to develop IKR energy reserves. The federal government has disputed the legal authority of the KRG to conclude most of these contracts, some of which are also in areas with unresolved administrative boundaries in dispute between the federal and regional government. In December, the federal government and the KRG agreed to sell oil exports from Kurdish-controlled oil fields under the federal oil ministry, in exchange for the central government paying $1 billion to the Kurdish Peshmerga forces and resuming budget transfers to the KRG that amount to 17% of Iraq's national budget. Iraq is making slow progress enacting laws and developing the institutions needed to implement economic policy, and political reforms are still needed to assuage investors' concerns regarding the uncertain business climate, which may have been harmed by the November 2012 standoff between Baghdad and Erbil and the removal of the Central Bank Governor in October 2012. climate.. The government of Iraq is eager to attract additional foreign direct investment, but it faces a number of obstacles obstacles, including a tenuous political system and concerns about security and societal stability. Rampant corruption, outdated infrastructure, insufficient essential services, skilled labor shortages, and antiquated commercial laws stifle investment and continue to constrain growth of private, nonoil sectors. Iraq is considering a package of laws to establish a modern legal framework for the oil sector and a mechanism to equitably divide oil revenues within the nation, although these reforms are still under contentious and sporadic negotiation. Under the Iraqi Constitution, some competencies relevant to the overall investment climate are either shared by the federal government and the regions or are devolved entirely to the regions. local governments. Investment in the IKR operates within the framework of the Kurdistan Region Investment Law (Law 4 of 2006) and the Kurdistan Board of Investment, which is designed to provide incentives to help economic development in areas under the authority of the KRG. Inflation has remained under control since 2006 as security improved. 2006. However, Iraqi leaders remain hard pressed to translate macroeconomic gains into an improved standard of living for the Iraqi populace. Unemployment remains a problem throughout the country despite a bloated public sector. Encouraging private enterprise through deregulation would make it easier for Iraqi citizens and foreign investors to start new businesses. Rooting out corruption and implementing reforms - such as restructuring banks and developing the private sector - would be important steps in this direction.

During 2014, 2015, worsening security and financial stability throughout Iraq - driven by an ongoing insurgency, decreasing oil prices, and political upheaval - decreased the prospects for improving the country's economic environment and securing much-needed foreign investment. Long-term fiscal health, a strengthened investment climate, and sustained improvements in the overall standard of living still depend on a rebound in global oil prices, the central government passing major policy reforms. reforms, and finishing the conflict with ISIL.
Iraq's largely state-run economy is dominated by the oil sector, which provides more than 90% of government revenue and 80% of foreign exchange earnings. Oil exports in 2014 remained relatively flat at 2.4 2015 averaged 3.0 million barrels per day on average, despite new production coming online at the West Qurna 2 day, up from 2014, but a failed revenue- and Badrah oilfields, because repeated attacks on the Iraq-Turkey pipeline reduced export capacity. During oil-sharing agreement with the second half Iraqi Kurdistan Region's (IKR) autonomous Kurdistan Regional Government (KRG) resulted in a loss of 2014, government revenues decreased as exports from northern oil fields. Moreover, falling global oil prices fell by more than 30%. resulted in declining export revenues. Iraq's contracts with major oil companies have the potential to further expand oil exports and revenues, but Iraq will need to make significant upgrades to its oil processing, pipeline, and export infrastructure to enable these deals to reach their economic potential. The Iraqi Kurdistan Region's (IKR) IKR's autonomous Kurdistan Regional Government (KRG) KRG passed its own oil law in 2007, and has directly signed about 50 contracts to develop IKR energy reserves. The federal government has disputed the legal authority of the KRG to conclude most of these contracts, some of which are also in areas with unresolved administrative boundaries in dispute between the federal and regional government. In December, December 2014, the federal government and the KRG agreed to sell oil exports from Kurdish-controlled oil fields oilfields under the federal oil ministry, in exchange for the central government paying $1 billion to the Kurdish Peshmerga forces and resuming budget transfers to the KRG that amount to 17% of Iraq's national budget. However, that deal fell apart in 2015.
Iraq is making slow progress enacting laws and developing the institutions needed to implement economic policy, and political reforms are still needed to assuage investors' concerns regarding the uncertain business climate.. climate. The government Government of Iraq is eager to attract additional foreign direct investment, but it faces a number of obstacles, including a tenuous political system and concerns about security and societal stability. Rampant corruption, outdated infrastructure, insufficient essential services, skilled labor shortages, and antiquated commercial laws stifle investment and continue to constrain growth of private, nonoil sectors. Under the Iraqi Constitution, constitution, some competencies relevant to the overall investment climate are either shared by the federal government and the regions or are devolved entirely to local governments. Investment in the IKR operates within the framework of the Kurdistan Region Investment Law (Law 4 of 2006) and the Kurdistan Board of Investment, which is designed to provide incentives to help economic development in areas under the authority of the KRG.
Inflation has remained under control since 2006. However, Iraqi leaders remain hard pressed hard-pressed to translate macroeconomic gains into an improved standard of living for the Iraqi populace. Unemployment remains a problem throughout the country despite a bloated public sector. Encouraging private enterprise through deregulation would make it easier for Iraqi citizens and foreign investors to start new businesses. Rooting out corruption and implementing reforms - such as restructuring banks and developing the private sector - would be important steps in this direction.

Iraq's GDP grew by more than 10% in 2016, the best performance in the past decade, because of rising oil prices, a significant driver of Iraqi GDP. During 2015, worsening 2016, security and financial stability throughout Iraq - driven by an began to improve as Iraqi Security Forces made gains against the ongoing insurgency, decreasing oil prices, insurgency and political upheaval - decreased prospects for improving oil prices slowly rose. The Iraqi Government entered into a Stand-By Arrangement (SBA) with the country's IMF in July 2016, which helped stabilize its finances by encouraging improved fiscal management, needed economic environment reform, and securing much-needed foreign investment. Long-term expenditure reduction. Iraq passed its first SBA review in December 2016, and additional progress on the program is critical to its long-term fiscal health, health. Diversification efforts – a key component to Iraq’s long-term economic development – require a strengthened investment climate, and sustained climate to bolster private-sector engagement. Sustained improvements in the overall standard of living still depend heavily on a rebound in global oil prices, the central government passing passage of major policy reforms, and finishing progress in the conflict with ISIL.
Iraq's largely state-run economy is dominated by the oil sector, which provides more than 90% of government revenue and 80% of foreign exchange earnings. Oil exports in 2015 2016 averaged 3.0 3.3 million barrels per day, day from southern Iraq, up from 2014, but a failed revenue- and oil-sharing agreement with 2015. Moreover, the Iraqi Kurdistan Region's (IKR) autonomous Kurdistan Regional Government (KRG) resulted in a loss slow recovery of exports from northern oil fields. Moreover, falling global oil prices resulted in declining improved export revenues. revenues throughout 2016, although monthly revenue remained below 2015 levels. Iraq's contracts with major oil companies have the potential to further expand oil exports and revenues, but Iraq will need to make significant upgrades to its oil processing, pipeline, and export infrastructure to enable these deals to reach their economic potential. The IKR's
Iraqi oil exports from northern fields are hampered by fundamental disagreements between the Iraqi Government and autonomous Kurdistan Regional Government (KRG) in Iraq’s Kurdistan region (IKR) on the roles of federal and regional authorities in the development and export of natural resources. In 2007, the KRG passed its own an oil law in 2007, to develop IKR oil and gas reserves independent of the federal government. The KRG has directly signed about 50 contracts to develop IKR with foreign energy reserves. The federal government has disputed the legal authority of the KRG companies to conclude most of these contracts, develop its reserves, some of which are also lie in areas with unresolved administrative boundaries territories whose status is in dispute between the federal Baghdad and regional government. Erbil. Some of the companies have left or returned blocks, citing lack of commercial prospects. In December 2014, the federal government and the KRG agreed to sell oil exports from Kurdish-controlled oilfields under the federal began exporting its oil ministry, in exchange for the central government paying $1 billion unilaterally through its own pipeline to Turkey, which Baghdad claims is illegal. In the Kurdish Peshmerga forces absence of a national hydrocarbons law, the two sides have entered into four provisional oil- and resuming budget transfers to revenue-sharing deals since 2009, all of which collapsed. In September 2016, the KRG that amount two sides began implementing a fifth ad hoc agreement to 17% of Iraq's national budget. However, that deal fell apart split oil exports from Baghdad-controlled fields in 2015. Kirkuk.
Iraq is making slow progress enacting laws and developing the institutions needed to implement economic policy, and political reforms are still needed to assuage investors' concerns regarding the uncertain business climate. The Government of Iraq is eager to attract additional foreign direct investment, but it faces a number of obstacles, including a tenuous political system and concerns about security and societal stability. Rampant corruption, outdated infrastructure, insufficient essential services, skilled labor shortages, and antiquated commercial laws stifle investment and continue to constrain growth of private, nonoil sectors. Under the Iraqi constitution, some competencies relevant to the overall investment climate are either shared by the federal government and the regions or are devolved entirely to local governments. Investment in the IKR operates within the framework of the Kurdistan Region Investment Law (Law 4 of 2006) and the Kurdistan Board of Investment, which is designed to provide incentives to help economic development in areas under the authority of the KRG.
Inflation has remained under control since 2006. However, Iraqi leaders remain hard-pressed to translate macroeconomic gains into an improved standard of living for the Iraqi populace. Unemployment remains a problem throughout the country despite a bloated public sector. Encouraging private enterprise through deregulation would make it easier for Iraqi citizens and foreign investors to start new businesses. Rooting out corruption and implementing reforms - such as restructuring banks and developing the private sector - would be important steps in this direction.

Iraq's GDP grew by more than 10% in 2016, the best performance growth slowed to 1.1% in the past decade, because of rising oil prices, 2017, a significant driver of Iraqi GDP. During 2016, security and financial stability throughout Iraq began marked decline compared to improve as Iraqi Security Forces made gains against the ongoing insurgency previous two years as domestic consumption and investment fell because of civil violence and a sluggish oil prices slowly rose. market. The Iraqi Government entered into a received its third tranche of funding from its 2016 Stand-By Arrangement (SBA) with the IMF in July 2016, August 2017, which helped is intended to stabilize its finances by encouraging improved fiscal management, needed economic reform, and expenditure reduction. Additionally, in late 2017 Iraq passed its first SBA review received more than $1.4 billion in December 2016, and additional progress on the program is critical to its long-term fiscal health. Diversification efforts – financing from international lenders, part of which was generated by issuing a $1 billion bond for reconstruction and rehabilitation in areas liberated from ISIL. Investment and key component sector diversification are crucial components to Iraq’s long-term economic development – and require a strengthened investment business climate with enhanced legal and regulatory oversight to bolster private-sector engagement. Sustained improvements in the The overall standard of living depend heavily depends on global oil prices, the central government passage of major policy reforms, a stable security environment post-ISIS, and progress in the conflict resolution of civil discord with ISIL.
the Kurdish Regional Government (KRG). Iraq's largely state-run economy is dominated by the oil sector, which provides more than 90% roughly 85% of government revenue and 80% of foreign exchange earnings. Oil exports in 2016 averaged 3.3 million barrels per day from southern Iraq, up from 2015. Moreover, the slow recovery earnings, and is a major determinant of global oil prices improved export revenues throughout 2016, although monthly revenue remained below 2015 levels. the economy's fortunes. Iraq's contracts with major oil companies have the potential to further expand oil exports and revenues, but Iraq will need to make significant upgrades to its oil processing, pipeline, and export infrastructure to enable these deals to reach their economic potential.
In 2017, Iraqi oil exports from northern fields are hampered by fundamental disagreements between were disrupted following a KRG referendum that resulted in the Iraqi Government reasserting federal control over disputed oil fields and autonomous Kurdistan Regional Government (KRG) energy infrastructure in Iraq’s Kurdistan region (IKR) on Kirkuk. The Iraqi government and the roles KRG dispute the role of federal and regional authorities in the development and export of natural resources. In 2007, the KRG passed an oil law to develop IKR oil and gas reserves independent of the federal government. The KRG has signed about 50 contracts with foreign energy companies to develop its reserves, some of which lie in territories whose status is in dispute between taken by Baghdad and Erbil. Some of the companies have left or returned blocks, citing lack of commercial prospects. In 2014, the in October 2017. The KRG began exporting its oil is able to unilaterally export oil from the fields it retains control of through its own pipeline to Turkey, which Baghdad claims is illegal. In the absence of a national hydrocarbons law, the two sides have entered into four five provisional oil- and revenue-sharing deals since 2009, all of which collapsed. In September 2016, the two sides began implementing a fifth ad hoc agreement to split oil exports from Baghdad-controlled fields in Kirkuk.
Iraq is making slow progress enacting laws and developing the institutions needed to implement economic policy, and political reforms are still needed to assuage investors' concerns regarding the uncertain business climate. The Government of Iraq is eager to attract additional foreign direct investment, but it faces a number of obstacles, including a tenuous political system and concerns about security and societal stability. Rampant corruption, outdated infrastructure, insufficient essential services, skilled labor shortages, and antiquated commercial laws stifle investment and continue to constrain growth of private, nonoil sectors. Under the Iraqi constitution, some competencies relevant to the overall investment climate are either shared by the federal government and the regions or are devolved entirely to local governments. Investment in the IKR operates within the framework of the Kurdistan Region Investment Law (Law 4 of 2006) and the Kurdistan Board of Investment, which is designed to provide incentives to help economic development in areas under the authority of the KRG.
Inflation has remained under control since 2006. However, Iraqi leaders remain hard-pressed to translate macroeconomic gains into an improved standard of living for the Iraqi populace. Unemployment remains a problem throughout the country despite a bloated public sector. Encouraging private enterprise through deregulation would make Overregulation has made it easier difficult for Iraqi citizens and foreign investors to start new businesses. Rooting out corruption Corruption and implementing lack of economic reforms - such as restructuring banks and developing the private sector - would be important steps in this direction. – have inhibited the growth of the private sector.

Iraq's GDP growth slowed to 1.1% in 2017, a marked decline compared to the previous two years as domestic consumption and investment fell because of civil violence and a sluggish oil market. The Iraqi Government received its third tranche of funding from its 2016 Stand-By Arrangement (SBA) with the IMF in August 2017, which is intended to stabilize its finances by encouraging improved fiscal management, needed economic reform, and expenditure reduction. Additionally, in late 2017 Iraq received more than $1.4 billion in financing from international lenders, part of which was generated by issuing a $1 billion bond for reconstruction and rehabilitation in areas liberated from ISIL. Investment and key sector diversification are crucial components to Iraq’s long-term economic development and require a strengthened business climate with enhanced legal and regulatory oversight to bolster private-sector engagement. The overall standard of living depends on global oil prices, the central government passage of major policy reforms, a stable security environment post-ISIS, and the resolution of civil discord with the Kurdish Regional Government (KRG).
Iraq's largely state-run economy is dominated by the oil sector, which provides roughly 85% of government revenue and 80% of foreign exchange earnings, and is a major determinant of the economy's fortunes. Iraq's contracts with major oil companies have the potential to further expand oil exports and revenues, but Iraq will need to make significant upgrades to its oil processing, pipeline, and export infrastructure to enable these deals to reach their economic potential.
In 2017, Iraqi oil exports from northern fields were disrupted following a KRG referendum that resulted in the Iraqi Government reasserting federal control over disputed oil fields and energy infrastructure in Kirkuk. The Iraqi government and the KRG dispute the role of federal and regional authorities in the development and export of natural resources. In 2007, the KRG passed an oil law to develop IKR oil and gas reserves independent of the federal government. The KRG has signed about 50 contracts with foreign energy companies to develop its reserves, some of which lie in territories taken by Baghdad in October 2017. The KRG is able to unilaterally export oil from the fields it retains control of through its own pipeline to Turkey, which Baghdad claims is illegal. In the absence of a national hydrocarbons law, the two sides have entered into five provisional oil- and revenue-sharing deals since 2009, all of which collapsed.
Iraq is making slow progress enacting laws and developing the institutions needed to implement economic policy, and political reforms are still needed to assuage investors' concerns regarding the uncertain business climate. The Government of Iraq is eager to attract additional foreign direct investment, but it faces a number of obstacles, including a tenuous political system and concerns about security and societal stability. Rampant corruption, outdated infrastructure, insufficient essential services, skilled labor shortages, and antiquated commercial laws stifle investment and continue to constrain growth of private, nonoil sectors. Under the Iraqi constitution, some competencies relevant to the overall investment climate are either shared by the federal government and the regions or are devolved entirely to local governments. Investment in the IKR operates within the framework of the Kurdistan Region Investment Law (Law 4 of 2006) and the Kurdistan Board of Investment, which is designed to provide incentives to help economic development in areas under the authority of the KRG.
Inflation has remained under control since 2006. However, Iraqi leaders remain hard-pressed to translate macroeconomic gains into an improved standard of living for the Iraqi populace. Unemployment remains a problem throughout the country despite a bloated public sector. Overregulation has made it difficult for Iraqi citizens and foreign investors to start new businesses. Corruption and lack of economic reforms - such as restructuring banks and developing the private sector – have inhibited the growth of the private sector.