Iraq’s Economic Growth of 1.4%: An Indicator of Recovery?

Iraq’s economy grew by 1.4%, marking a recovery from a 2.9% contraction in 2023. Iran’s economy expanded by 3.7%, while regional averages were lower. Factors for growth include oil production increases, although challenges in non-oil sectors persist, necessitating sustained efforts for economic stability.

According to recent economic indicators released by Iran’s Central Bank, Iraq has experienced a modest economic growth of 1.4% over the past Iranian year. This figure, covering the initial nine months of the year, indicates a recovery from a previous contraction of 2.9% in 2023, as reported by the International Monetary Fund (IMF).

The broader regional context reflects a diverse growth pattern, with Iran’s economy expanding by 3.7%. Other neighboring economies also showed growth, with Turkiye at 2.8% and Pakistan at 2.5%. This brings the total growth for the Middle East and Central Asia to an average of 2.4%.

Iraq’s growth is primarily attributed to a gradual rise in oil production and exports, which have benefited from stabilization of global oil prices. However, the World Bank has emphasized that non-oil sectors—including agriculture, construction, and services—are also essential contributors to this growth.

Despite these positive trends, both the IMF and World Bank caution that the growth rate remains inadequate to effectively combat unemployment or improve living standards in Iraq. To secure longstanding economic stability and address structural challenges, Iraq will need to achieve more robust and sustained growth moving forward.

In summary, Iraq’s recent economic growth of 1.4% suggests a gradual recovery from previous setbacks, largely driven by oil production enhancements and regional economic dynamics. However, significant challenges remain, particularly in improving unemployment rates and living standards, indicating a need for more robust growth strategies to ensure long-term stability in the Iraqi economy.

Original Source: shafaq.com