By Michael Carr, Anglo Arab Insurance Brokers (AAIB).
Iraq’s Massive Potential – The Promise from Trade and Investment
The newly appointed Baroness Nicholson as the United Kingdoms Trade Envoy to Iraq underscores the view felt by some senior business interests, that “Iraq has massive potential … the future is very good indeed (and) it’s a tough struggle to get there, but that’s no reason not to be in there to help.”
This, from a seasoned UK politician who has wide experience of foreign affairs; economic development in the Middle East, aspects of European union policy and who is the Executive Chairman of the Iraq Britain Business Council. She will have been well briefed before taking up her new appointment and can draw upon her knowledge and understanding of the country.
So, what underpins her outlook? Is her optimism justified? No doubt, the country’s strengthening economic position played a factor – Iraq has seen its Gross Domestic Product double since 2003 and the World Bank recorded growth rates of 8% in the past two years. A robust picture on trade and investment flows exists. Further investments and expansion of trade will further drive economic improvements and fuel Iraq’s vibrant economy.
However these can be in tandem with internal structural changes and liberalisation of economic policy and a reduction in the power of state owned enterprises. With the official unemployment rate standing at 17% and with persistent complaints from the business community about corruption and too much bureaucracy and red tape, more needs to be done to reduce these barriers to trade and investment.
Also, as the growth of commerce and trade is inseparable from issues of security and business confidence, and reflects the situation of political stability, these are the areas that must receive continued attention. They are all interlinked and interdependent.
Iraq has achieved impressive economic progress over the last few years, despite the difficulties and setbacks that have happened, and the pressures that its institutions and its people have faced. As Baroness Nicholson has said, “Iraq has massive potential”, but the road to reaching that potential will be a long and difficult one. It’s a road worth taking.
Michael Carr is a consultant specialising in development, risk and insurance in Emerging Markets. He has worked in various conflict and post conflict territories and has written on these subjects for various publications. Any opinions expressed are those of the author, and do not necessarily reflect the views of AAIB or Iraq Business News.