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Iraq still faces many development challenges, despite the surge in terms of economic growth recently, no doubt that the country needs to rebuild infrastructure and institutions.
Baghdad / Mesalla: the weekly report said QNB Group that while Iraq continues to expand in the exploitation of its oil resources, it is in need of further diversification of the economy of this country.
Following the Second Gulf War, resulting in the acceleration of oil production in Iraq to raise the per capita GDP of U.S. $ 1.790 in 2005 to 6.300 billion in 2012 in spite of the difficulties faced by the country at the social level.
According to the report, "Iraq's economy is still suffering from structural weaknesses, such as the small size of the non-oil sector, and the dominance of the public sector on all aspects of the economy, and the lack of an enabling environment for doing business.
According to the expectations set QNB, and with the continuation of the Iraqi economy in its growth by relying mainly on developments in the oil sector, it is expected for economic growth to remain strong in the short term, but there are risks to the macroeconomic situation, such as aggravation of social instability and weak policy implementation. These risks can lead to reduced oil revenues, and then to a weakening of the financial situation and could lead to accelerate the rise in inflation levels.
Recovery of oil production
The macroeconomic performance of Iraq during the past few years, well on the back of the recovery of oil production. In 2012, oil production averaged 3.1 million barrels per day, the highest level in 30 years. The acceleration of growth in GDP at constant prices by 6.4 percent on average during the years 2005-2012 in the light of the rise in oil prices and production, but higher economic growth based on the expansion of the oil sector may not be enough to ensure the continued prosperity. The lack of economic diversification, yet makes Iraq's economic growth sensitive to fluctuations in global oil prices may lead to damage to macroeconomic stability.
Accordingly, the economic diversification may be a challenge to the Iraqi government in terms of creating new jobs in the creation of income-generating opportunities for the vast majority of the population. Has contributed to the International Monetary Fund in support of the government program of economic reform for the medium term, and thus helped to improve the sustainability of public finances and reduce the sensitivity and vulnerability Iraqi economy بالتقلصات the windfall in oil revenues.
Development challenges
The report says that Iraq still faces many challenges of development in spite of the surge, which recently achieved the level of economic growth. There is no doubt that the country needs to rebuild infrastructure and institutions, a task aided social conflicts that lie difficulty. In addition to that, have contributed to the effects of war and sanctions in the deterioration of social indicators to Iraq in recent years.
For example, the rate of child mortality in Iraq is among the worst in the Middle East and North Africa. The rate also fell in school enrollment over the past decade as a result of the low quality of education and return. During the period from 2007 to 2012, increased the rate of consumption among the at least 40 percent of the population income by only 1.1 percent per year, which is less than the average increase in the consumption of the Iraqi population as a whole (1.8 percent) and express the growing imbalance in the distribution of income.
For the future, QNB Group expects that GDP rises to Iraq at constant prices to 6.3 percent in 2014, with the escalation of the increase in oil production in addition to the acceleration of the expansion of government services, trade and construction. Furthermore, it is expected to rise to invest heavily in many of the oil fields, the huge and rising momentum of growth in infrastructure, but factors such as the challenge of the social situation is stable, and external shocks, and the weakness of the economic structure represents a risk to the prospects for the future of Iraq in the short term. The main challenge remains for the Iraqi economy in the medium term is to develop its non-oil sector, which could lead to the diversification of the sources of the economy, and raise the standard of living and improve the social conditions of the Iraqi people.
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Baghdad / Mesalla: the weekly report said QNB Group that while Iraq continues to expand in the exploitation of its oil resources, it is in need of further diversification of the economy of this country.
Following the Second Gulf War, resulting in the acceleration of oil production in Iraq to raise the per capita GDP of U.S. $ 1.790 in 2005 to 6.300 billion in 2012 in spite of the difficulties faced by the country at the social level.
According to the report, "Iraq's economy is still suffering from structural weaknesses, such as the small size of the non-oil sector, and the dominance of the public sector on all aspects of the economy, and the lack of an enabling environment for doing business.
According to the expectations set QNB, and with the continuation of the Iraqi economy in its growth by relying mainly on developments in the oil sector, it is expected for economic growth to remain strong in the short term, but there are risks to the macroeconomic situation, such as aggravation of social instability and weak policy implementation. These risks can lead to reduced oil revenues, and then to a weakening of the financial situation and could lead to accelerate the rise in inflation levels.
Recovery of oil production
The macroeconomic performance of Iraq during the past few years, well on the back of the recovery of oil production. In 2012, oil production averaged 3.1 million barrels per day, the highest level in 30 years. The acceleration of growth in GDP at constant prices by 6.4 percent on average during the years 2005-2012 in the light of the rise in oil prices and production, but higher economic growth based on the expansion of the oil sector may not be enough to ensure the continued prosperity. The lack of economic diversification, yet makes Iraq's economic growth sensitive to fluctuations in global oil prices may lead to damage to macroeconomic stability.
Accordingly, the economic diversification may be a challenge to the Iraqi government in terms of creating new jobs in the creation of income-generating opportunities for the vast majority of the population. Has contributed to the International Monetary Fund in support of the government program of economic reform for the medium term, and thus helped to improve the sustainability of public finances and reduce the sensitivity and vulnerability Iraqi economy بالتقلصات the windfall in oil revenues.
Development challenges
The report says that Iraq still faces many challenges of development in spite of the surge, which recently achieved the level of economic growth. There is no doubt that the country needs to rebuild infrastructure and institutions, a task aided social conflicts that lie difficulty. In addition to that, have contributed to the effects of war and sanctions in the deterioration of social indicators to Iraq in recent years.
For example, the rate of child mortality in Iraq is among the worst in the Middle East and North Africa. The rate also fell in school enrollment over the past decade as a result of the low quality of education and return. During the period from 2007 to 2012, increased the rate of consumption among the at least 40 percent of the population income by only 1.1 percent per year, which is less than the average increase in the consumption of the Iraqi population as a whole (1.8 percent) and express the growing imbalance in the distribution of income.
For the future, QNB Group expects that GDP rises to Iraq at constant prices to 6.3 percent in 2014, with the escalation of the increase in oil production in addition to the acceleration of the expansion of government services, trade and construction. Furthermore, it is expected to rise to invest heavily in many of the oil fields, the huge and rising momentum of growth in infrastructure, but factors such as the challenge of the social situation is stable, and external shocks, and the weakness of the economic structure represents a risk to the prospects for the future of Iraq in the short term. The main challenge remains for the Iraqi economy in the medium term is to develop its non-oil sector, which could lead to the diversification of the sources of the economy, and raise the standard of living and improve the social conditions of the Iraqi people.
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