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Iraq Rapid eTrade Readiness Assessment

image of Iraq Rapid eTrade Readiness Assessment

Abstract

Iraq’s economy is at a turning point. For decades it has relied on crude oil production and export to drive the economy. In many ways, this was a success story, with oil revenue contributing to healthy GDP growth and funding a wide range of government services. With the relatively improved security environment and a shift towards post-conflict reconstruction, Iraq is now well-positioned to diversify its economy and take advantage of new digital technologies. The economy is gradually improving, with 4.4 percent GDP growth in the first half of 2019. This growth was driven by a rise in crude oil production, but also a rebound in non-oil economic activity. The Iraqi economy also received a boost of confidence in 2019 with the signing of several trade agreements with its neighbors, including Iran and Saudi Arabia. Looking towards the future, there is a stark need to diversify the Iraqi economy. Oil accounts for more than 90 percent of government revenue and in 2018, crude oil constituted 98 percent of exports. Increasing non-oil economic activity would diversify the Iraqi economy, increase employment opportunities and create new value chains. Increasing regional and international trade will be key. Iraq also has a very young population, with nearly 60 percent of the population under 24 years old. The oil sector employs just one percent of the population, however, and the public sector can no longer afford to absorb the thousands of graduates the country produces. In this context, the role which e-commerce can play is promising. There is deep appreciation of the importance of e-commerce among the people of Iraq and a few promising startups. However, very few practical steps have been taken to create an enabling environment for e-commerce to thrive, and no national plans have been established to move Iraq towards a digital future.

Countries: Iraq

References

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