In order for Iraq’s economy to truly start to replenish is for the infrastructure across the country to be rebuilt. Without infrastructure, the necessary systems to function in a modern economy are simply not going to be in place. To address this very imminent need, the government of Iraq has put into place a five year rebuilding plan that will hopefully allow many local economies that have been destroyed to be able to flourish, again.
One of the biggest concerns and roadblocks that stands in the light of this rebuilding plan is the fact that Iraqi debt has grown to exceed $125 billion, based on information from the International Monetary Fund. Next year, this amount is predicted to grow beyond $134 billion, based on those sames projections. Due to the fact that Iraqi GDP was around $168 billion in 2015, this means that Iraqi debt could overtake GDP over the next decade if these numbers continue on this path. The cost of the expected infrastructure plan is estimated to be between $350 billion and $400 billion. With a large amount of Iraqi GDP leaving the country, this makes it difficult to amass, yet it is absolutely necessary to reconstruct the country’s economy.
Threats to infrastructure
Overall, there are two major threats that hang over the creation of infrastructure spending plans: corruption and violence. Corruption is a particularly heavy issue throughout the Iraqi government, and it is one that severely needs to be addressed. Currently, it is predicted that over 50% of government revenue in Iraq is lost to corruption.
The other major roadblock that stands in the way of a budget that would rebuild the country’s infrastructure is the very reason that it needs to be rebuilt in the first place: war. Between the Iraqi War and fighting with ISIS, dozens of cities across the country have been destroyed. In particular, in the region of Kurdistan, over 80% of the cities that have been battlegrounds against ISIS are in ruins. Without reconstruction, these cities will continue to only be ruins, and economic growth will be nigh impossible in these regions.