Economic Policy

  • Statement on EU Trade (20 Nov 2006)

    Report in the Financial Times newspaper on a bilateral trade deal with the EU

  • A Joint Statement Concerning the Programmes of the World Bank and the International Monetary Fund in Iraq (16 Jan 2006)

    This joint statement of workers unions from all parts of Iraq was adopted on January the 16th, 2006, at the end of a two-day seminar in Amman, Jordan.

  • IMF Approves Stand-By Arrangement for Iraq (23 Dec 2005)

    The Executive Board of the International Monetary Fund (IMF) approved the institution's first-ever Stand-By Arrangement for Iraq, which is designed to support the nation's economic program over the next 15 months. A pdf file containing a report by IMF staff completed endorsing the SBA request, an Appendix containing documents from the Iraqi government in support of their SBA request, a supplemental report by IMF staff indicating that Iraq had enacted the remaining pre-conditions to the SBA, and a statement by Iraq's Executive Director at the IMF is now available. The main elements of the reports are:

    • the SBA allows Iraq to draw on 40% of its IMF quota in the event of a crisis; Iraqi authorities plan not to use this right;

    • the SBA runs until March 2007

    • in return for this facility, Iraq accepts a number of quantitative performance criteria and targets (p. 29, Table 11) centred on fiscal stability as well as a number of qualitative structural performance criteria and benchmarks (p. 31, Table 13) centred on central bank operations, government statistics (including audits thereof) and the development of the banking sector, largely by implementing modern clearing systems between the CBI and commercial banks.

    • approval of the SBA triggers the second 30% reduction of Paris Club debt. The IMF staff still regard Iraqi debt as 'unsustainable'; with the third reduction (to occur if Iraq undergoes three years of programmes like the SBA) it becomes 'sustainable'

    • the document reports on Iraqi economic and governance performance

    None of the ongoing criteria or targets listed above relate directly to petroleum product subsidies. That which seems to bear on this most closely is the floor on revenues from oil related enterprises (Table 11). This would see ID3,250bn (US$2.2bn) raised over 2006, compared to ID900bn (US$600mn) over 2005. To put this in perspective, the 2006 target is a bit less than what the Iraqi government has been spending annually to import refined products.

    In December 2005, as a 'prior action', the Iraqi government did reduce subsidies on a number of petroleum products. The price schedule is displayed in Table 6 (p. 24), which includes an average of prices in the Gulf. These are listed as the IMF staff "urge" Iraq (p. 10, para. 21) to align domestic prices to this average by 2007; the strategy of Iraqi authorities is to further increase prices on a quarterly basis.

    There is almost no discussion about how these prices rises are expected to influence Iraqi society: no information is presented on who currently benefits from the subsidies, in part as this is probably not known - a household income and expenditure survey is only expected to be ready by the end of 2006 (p. 15, para. 39). Thus, steps are mentioned to offset the disruption that will be caused - better control over ration expenses, a 'safety net' equal to one third the savings gained from subsidy reductions targetted at the million poorest households (p. 11, para. 25) - but no further details are provided.

  • 2005 Article IV Consultation (Aug 2005)

    Annual IMF report, including data on oil production, inflation, assesment of Millenium Development Goals progress. Notes a lack of macroeconomic data and urges the Iraqi government to reduce Petrol subsidies. There is also a statistical appendix

  • Pensions In Iraq: Issues, General Guidelines for Reform and Potential Fiscal Implications (Aug 2005)

    World Bank policy note

  • Rebuilding Iraq: Economic Reform and Transition (July 2005)

    Executive Summary of a report focusing on the main issues of Iraq’s transition . Lays out policy options available to the Iraqi government, and discussing tradeoffs under each option. The key themes are reconstruction and job creation; reform of the pricing system; managing oil revenues; and strengthening safety nets.

    In particular, notes "In 2004, only 15 percent of households had a stable electricity supply, and a mere 20 percent had safe and stable drinking water. ". Also focuses on the need to create a better environment for private job creation, trade policy, pricing systems and public governance.

  • Iraq Development Strategy: 2005-2007 (30 June 2005)

    Produced by the Iraqi Strategic Review Board, Ministry of Planning and Development Cooperation. Comprehensive look at government strategy at the micro and macro level, including a focus on how to devolve responsibilities to the regional level.

  • Considering the Future of the Iraqi Public Distribution System (28 June 2005)

    Looks at the function of the PDS in the post-sanctions-era. Considers three options: a rapid elimination of the PDS; replacement of the PDS with universal cash transfers (available to all Iraqis); and replacement of the PDS with means-tested cash transfers. It recommends a four-part program including (i) gradually introducing targeting, (ii) reducing the number of products in the ration basket, (iii) increasing the role and capacity of the private sector in the PDS, and in food markets in general, and (iv) immediate improvements in procurement and financial management.

  • Baghdad Year Zero (Sept 2004)

    Naomi Klein links the failures in reconstruction of Iraq to US corporate interests and laissez-faire economic policy.

  • Rehabilitation and Reconstruction of Iraq (19 May 2004)

    Paper by Almas Heshmati, an academic at the MTT Agrifood Research Finland. Tries to provide a comprehensive picture of the past and current conditions in Iraq, and evaluates proposed development policies

  • Economic policy and prospects in Iraq (04 May 2004)

    Account of the CPA's attempts at economic reform. Concludes that economic development will come only if Iraq "maintains the pro-market outlook of Coalition policy". Written by four former CPA officials, affiliated with the US treasury, US and UK central banks, and the RAND Corporation. Draft of a paper written for the Journal of Economic Perspectives.

  • Joseph Stiglitz discusses the dangers of liberalization in Iraq (23 Sept 2003)

    Video of a speech by Joseph Stiglitz (winner of the 2001 Nobel prize for economics) criticizing rapid liberalisation of the Iraqi economy. With responses from two other academics.

  • Iraq's economy: past, present, future (03 June 2003)

    Report prepared for the US Senate committee on foreign relations by Jonathan E. Sanford. Although this version dates to 2003, the report claims it "will be updated periodically".

  • Accession through the backdoor: how the US is pushing Iraq into the WTO

    Mary Lou Malig looks into US workings on Iraq's acession to the WTO in an article for 'Focus on the Global South' .