Challenges facing Iraq economy due to lower oil prices 8/30
The challenges facing the Iraqi economy in light of lower oil prices
Characterize the Iraqi economy as a unilateral and non-diversified in its resources to its dependence on the oil sector exclusively starting in 1968 and so far this reflects the stupid policies pursued by the previous power that was boasts that last barrel stockpile of oil will be in Iraq did not realize that the developed world scientifically and technologically him of policies and procedures that enable it to Arcaa others through prices and policies, including military control and even higher oil prices it wants the power of God that Iraq did not benefit them for entering the frequent wars and then the economic blockade until 2003.
It was supposed to be this huge wealth be blessing us, but they are the opposite of being taken advantage of its resources in building a military arsenal was one of the former regime tools to wage bloody wars against its neighbors and dissipate the energies of the country, but the loss of the lives of thousands and perhaps that oil one of the main reasons for the occupation of Iraq to control the oil resources rich in it.
In this study we will shed light on the change in the structure of the building of the Iraqi economy negatively targeted the years 1970 - 1980 because it is the golden period in which they sing the previous government claimed as a period of nationalization of the oil development plans and major establishment Alasttratejah projects, either the period that sustained it was the Iran-Iraq war and the invasion of Kuwait and the international embargo on Iraq and can not be for the economy to grow and recover so in such circumstances.
We have put the former regime, the first building block in the Iraqi economy deteriorating and the situation we are facing our economy because of the drop in oil prices is a result of the policy mentioned and that made the Iraq oil countries not only for the purpose that we open the dialogue table to Aevotna but the note to some terms of economic and Titles that have relationship to our subject: * GDP rate: is the value of final goods produced in the general economy during a certain period of time. * Capital: is the result of a production process that goes into a new production process, either be fixed such as buildings, machinery or primary metals trader within the industry. * Planning: A group of organizations and specific arrangements agreed upon in order to reach specific goals or guidance is conscious of the resources of the community to achieve the desired goals. * Plan: a series of decisions to be taken to achieve certain goals period of time may be a year or five years or ten years depending on the holistic planning and unit size. * Growth: the increase means that occurs without the intervention of the state to prepare programs and plans. * Voluntary Growth: planned and intended, which is reached by appropriate actions and measures designed to achieve a certain growth rate.
Deteriorating economic sectors
In Iraq (except oil)
If we reviewed the case of the Iraqi economy over a period of the fifties limit the beginning of the seventies which we consider to shift the terms of the oil industry began to play a vital role and using the language of statistical figures for resources point we will see clearly that it is an agricultural country first and oil secondly, meanwhile, was the contribution of this sector (agriculture) in GDP 24% for the period 1953-1959 and 27% for the period from 1960 to 1969 and then dropped to 9% in 1976 and to 6% in 1980.
These figures clearly reflect the deterioration that took place in this sector, although the regime has declared agricultural development policies.
Deterioration not be in the agriculture sector, but also included the manufacturing and other sectors except oil for example, water and electricity services sector in 1970 was its contribution to 1.1% fell to 4.0% in 1976 and then to 3.0% in 1980 and represented the manufacturing of 9.7% to the industrial sector 7.1% and then to 4.5% and the same thing for the sector of personal services was 2.2% and then to 0.9% and then to 0.4%, while the growing contribution of the oil sector from 30% to 52% and then to 61% for the same years also, but after the Iran-Iraq war, the sector's contribution fell oil due to military operations to 24.4% between 1981-1982.
Its imports of goods and
If we look at the statistical figures for exports of Iraq's non-oil and during the period 1950 - 1979 we will see not get a remarkable development in this direction and remained modest numbers despite development in the agricultural and industrial sector plans in return import goods numbers have doubled in obliged years above and Zaraladz winning in the trade balance for the whole years mentioned But the government at the time did not take any action to solve this economic problem but resorted to crude oil resources to meet the stated deficit.
The contribution of the private sector In the composition of capital
We all know the basic and important role played by the private activity in the evolution of the economy and increase the activity and effectiveness and we could hear from the former regime computers a lot in this regard and did not witness little in reality and can review it in numbers, and the system itself STATISTICS For example, the contribution of the private sector in capital formation in 1968 is 43% down to 17% in 1976 and then to 20% in 1980 if we came back and we had a comparison we will notice the contribution of this sector, 53% in 1958 and then to 57% in 1961 and the contribution rate for the period from 1962 to 1967 is 43.6% and this figure but half planning devices could not the former regime reach it at all, reflecting the decline and stagnation that was suffered by the Iraqi economy and the adoption of capital formation on the contribution of government activity for a major.
The challenges, but the biggest problem that the resources that are supposed which revives and development sectors of the Iraqi economy, including services would be reduced by the drop in global oil prices and the economic recession is gripping the world, which would use the Iraqi state to follow rationalization in unnecessary expenses without operating expenses and A_ad that the latter included if this condition persists Status subsequent years and dropped the price of a barrel of oil to $ 20, if we know that the number of staff in Iraq are two million, four hundred people and pensioners are two million and as such figures are not Peerh the state insurance entry and monthly paid after large increases in them, but some say possible to increase the National oil and our products but forget those high cost of extraction, so it has to be thinking about other options.
The ideal solution The foundation in the best solution depends to amend the structure of the Iraqi economy reduces its dependence on oil revenues as the main source of Aiardth by increasing the production capacity of agriculture and industry in the formation of national income as well as the exploitation of other mineral resources, he estimates it comes to agriculture, we must adopt the following things:
- Meet the agricultural development of machinery and equipment, machinery, pesticides and fertilizer needs, as well as what it needs irrigation pumps and irrigation systems spray and drip and focus on the production of alternatives locally and replace the imported products, whether food or production requirements to achieve a surplus in the balance of payments.
- Focus on Ktamath factories and dairy own agricultural projects to provide raw materials and access to self-sufficiency in strategic crops like wheat, rice, barley, similar to the experience of the Kingdom of Saudi Arabia.
- Fisheries development and utilization of water bodies and marshes and lakes.
- Surveys, soil salinity complete maps for the purpose of raising agricultural production rates with the need to continue in land reclamation and irrigation and drainage networks relying on foreign companies on credit costs.
- Make way for the Iraqi and Arab agricultural companies in the field of agricultural investment sin of plant production and animal production.
- Continue to increase the intensive animal production and development efforts in accordance with the purposeful and accurate programs and not, as is the case in giving advances without proper controls.
In the industrial sector is assumed to adopt the following methods:
- Improving the quality and development of standard specifications approved for industrial goods and tighten control over the quality to enhance the confidence of citizens National to the product as it is currently happening in products Ishtar Company for Electrical Industries.
- Create and establishment of industries that increase the overlap between industry and agriculture.
-altusa In industries that cater to the needs of citizens Kalgmaiah, textile, fertilizer, cement, bricks and fittings.
- Prevent the import of luxury items and non-essential Kattor and cosmetics and the imposition of high taxes on cigarettes and tobaccos.
- Re-run self-financing companies and benefit from its staff experienced private practice, which was already working in the field of military industrialization.
- To encourage scientific research and development in specialized centers and embracing young talent and owners of patents and competencies.
- The expansion of the export industries to obtain foreign currency.
Reforms in the sector Commercial and financial - Develop guidelines and conditions and the imposition of taxes on Iraqi investors who employ their capital projects in the industrial, agricultural and trade in the Arab world, especially Lebanon and Jordan.
- Prevent banking offices of foreign exchange outside Iraq's main government banks and holds the job in Baghdad and is limited to enhanced import bills and cases of goods certified by the customs and case studies and medical treatment.
- Do quality control to prevent the importation of goods, equipment and mechanisms of the origins and markets it is reliable and who invaded the Iraqi market and Atstqubl these goods any foreign market.
- Emphasis on border crossings for travelers not to exit the gold coins Iraqi and foreign paper currency, but the limits of the traveler need.