The State of Iraq’s Economy One Year on from Allawi’s White Paper

This is the English recording of Panel 2 from the 28th September Conflict Research Programme-Iraq Conference 'Iraq on the Eve of Elections: A new era or return to the status quo?'. Iraq has long been on the verge of economic collapse. This was expounded in April 2020, when the fall in oil prices in the wake of the Covid-19 pandemic meant that the government struggled to pay public sector workers for several months. In response, Finance Minister Ali Allawi published a White Paper meant as a road map for the country’s economic recovery and later, in January of this year, devalued the dinar by 20% as a means of stimulating internal markets. Yet, 90% of all government revenues continue to come from oil sales leaving Iraq’s economy vulnerable to the volatility of global oil markets and state sanctioned corruption sees up to 30% of public funds lost every year. What is more, while the public payroll has more than tripled since 2003, the development of the private sector continues to be hampered by poor infrastructure and limited access to capital. As a consequence, youth unemployment in Iraq stands at 25.2% and the World Bank estimates that 5.5 million Iraqis are at risk of being pushed into poverty. This panel examines the success of reforms undertaken by Mustafa Al Kadhimi’s government and opportunities for further reforms, as well as the socio-political consequences of economic complacency. Chair: •Chloe Cornish – Financial Times Speakers: • Ahmed Tabaqchali – Institute of Regional and International Studies • Ali Al Mawlawi – Independent Consultant • Alia Moubayed – Jefferies International