The stagnation of markets, the stagnation of government projects, the majority of private sector projects, a continuous decrease in the prices of the local currency versus the foreign, the high prices of goods in the market, the lack of employment opportunities and the delay in approving the financial budget, all of which represent the most prominent features of the Iraqi economic scene that entered the stage of recession.

Despite the approaching end of the first quarter of this year, the Iraqi Council of Representatives has not yet been able to approve the financial budget in the country, about which the differences are deepening between the political blocs day after day after the failure to reach solutions that satisfy all parties. The country is heading towards recession, which is “the continuous decline in the price of the local currency compared to foreign currencies, thus a decrease in the purchasing power of the national currency, and this will lead to inflation and an increase in the prices of goods and services in the local currency as a currency.” The 40% increase in oil revenues in November 2020 eased the liquidity crisis, providing some breathing space for the government, but little progress has been made in implementing much-needed reforms.

“Iraq cannot afford the constant dependence on resource extraction, nor the excessive burden of a public sector that is too great. The battle against economic and political corruption and the promotion of strong governance, transparency and accountability should be the slogan that accompanies this reform,” she said.

The UN official Plasschaert added that “agreement on the 2021 budget law requires reconciliation and settlement between Baghdad and Erbil.”

“However, laws absent since 2005 continue to hinder constructive negotiations between Baghdad and Erbil, such as those related to oil and revenue sharing, and other disputes related to disputed territories,” Blashart said.

In the same context, the economic expert, Khattab Imran Al-Damen, says that the Iraqi economy is going through a state of “inflationary depression” that began with the reduction of the Iraqi dinar exchange rates against the dollar since the beginning of this year.

He explained to “Raise your voice”: “The reduction in the value of the dinar did not contribute to reviving the Iraqi economy. On the contrary, it contributed to deepening the recession due to the high prices of basic materials in exchange for the inability of the productive sectors to produce imported goods.”

“The main reason for this is the openness of Iraqi markets to imported goods from countries that enjoy competitive advantages characterized by low production costs, including China, Turkey and Iran,” according to the guarantor.

And he proposes a set of solutions to save the Iraqi economy from its successive crises, namely, “forcing ministries and government departments to buy locally produced goods and services if they are available, and this will revive the productive sectors, reduce imports and create job opportunities, prevent the entry of agricultural products that can be produced locally, and support the two industrial sectors.” And agricultural loans by providing loans and protection. “

The guarantor considers that “reviving the Iraqi economy is a long and arduous process that requires a national political will from the hierarchy of power that works to protect national production and imposes a customs tariff system that stops the commodity dumping operations that the Iraqi markets suffer from.” Reliance on oil as a primary source of income for the country.

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