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Iraq Poised for Economic Renaissance: Insights from Prime Minister’s Advisor on Future Development Plans

2025-01-28T16:14:08+00:00

Mazhar Muhammad Saleh, the economic and financial advisor to Iraqi Prime Minister Mohammed Shia Al-Sudani, recently provided insights into the expected economic outlook for Iraq in the forthcoming period.

According to Saleh, Iraq possesses significant economic potential, evidenced by a simultaneous emergence of infrastructure development and strategic growth initiatives aimed at attracting both local and international investments. He emphasized that this initiative could trigger an unprecedented renaissance, especially in the urban residential sector and the introduction of new cities, thereby enhancing economic welfare and employment levels across the country.

Saleh remarked on the current economic climate, noting that Iraq is experiencing a remarkable stability in prices, with the annual growth rate in prices not exceeding 2.9%. This contrasts with a GDP growth rate of 6%, positioning Iraq on a path toward sustainable economic development while witnessing notable progress across all provinces.

He further elaborated on the national development plan for 2024-2028, which aims to increase the industrial sector’s contribution to GDP from less than 1.8% to approximately 2.2%. Saleh indicated that this progress will be achieved through diversifying the industrial sector, with a focus on transitioning from crude oil production to oil derivatives and petrochemical industries.

Highlighting Iraq’s abundant natural resources, Saleh stated that the nation ranks ninth globally in terms of natural resource wealth, with an estimated market value exceeding $16 trillion. He suggested that utilizing and manufacturing these resources could significantly increase their value for both domestic industry and export purposes.

The national development plan emphasizes rebuilding the manufacturing base through genuine partnerships with the private sector. Here, the state will finance 85% of transformational industries, while the private sector is responsible for 15% of funding.

The financing strategy is structured across five key levels, prioritizing projects related to reconstruction and housing, as well as infrastructure development. There will also be an emphasis on pharmaceuticals, guided by an economic governance philosophy that advocates for state-market partnerships with a robust social safety net, stepping away from traditional economic liberalism.

A pioneering initiative has been launched to provide small and medium loans to the youth sector, stemming from a leadership initiative by the Prime Minister. This program aims to generate thousands of loans for young innovators, recognizing that 60% of the workforce is engaged in small and medium enterprises, while also nurturing strategic national industries such as petrochemicals and digital sectors.

In conclusion, Saleh identified this approach as a crucial transformation in addressing the current sustainable unemployment challenges. Unemployment rates have decreased to approximately 14% and are expected to further decline to a normal level of around 4% of the total workforce. The government aims to provide nearly 500,000 new job opportunities for those of working age who are able and willing to work.

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