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COUNTRY PROFILES


PROFILE

Country Profile

Area: 437,072 sq km
Population: 24,683,000 (July 2003 estimate)
Capital City: Baghdad (population: 3.8m 1986 estimate)
People: Arab 75-80%, Kurdish 15-20%, Turkoman, Assyrian and other 5% (estimated).
Language(s): Arabic, Kurdish, Assyrian, Armenian and Turkoman.
Religion(s): Muslim 97%, Christian or other 3% (estimated).
Currency: New Iraqi Dinar
Major political parties: Assyrian Democratic Movement, Badr Organisation, Islamic Da'awa Party, Islamic Union or Iraqi Turkomen, Islamic Virtue Party, Iraqi Independent Democrats, Iraqi Islamic Party, Iraqi National Accord, Iraqi National Dialogue Front, Kurdistan Democratic Party, National Democratic Party, Patriotic Union of Kurdistan, Sadrist Movement
Government: Government of Iraq
Head of State: President Jalal Talabani
Prime Minister: Nouri al-Maliki
Foreign Minister: Hoshyar Zebari
Membership of international groupings/organisations: Iraq is a member of the Arab Bank for Economic Development in Africa (ABEDA), Arab Cooperation Council (ACC), Arab Fund for Economic and Social Development (AFESD), Arab League (AL), Arab Monetary Fund (AMF), Council of Arab Economic Unity (CAEU), World Customs Organisation (WCO), Economic and Social Commission for Western Asia (ESCWA), Food and Agriculture Organisation (FAO), Group of 19 (G-19), Group of 77 at the United Nations (G-77), International Atomic Energy Agency (IAEA), International Bank for Reconstruction and Development (IBRD), International Red Cross and Red Crescent Movement (ICRM) International Fund for Agricultural Development (IFAD), International Finance Corporation (IFC), International Federation of Red Cross and Red Crescent Societies (IFRCS), International Labour Organisation (ILO), International Monetary Fund (IMF), International Maritime Organisation (IMO), International Criminal Police Organisation (INTERPOL), International Telecommunications Union (ITU), Non Aligned Movement (NAM), Organisation of Arab Petroleum Exporting Countries (OAPEC), Organisation of the Islamic Conference (OIC), Organisation for Petroleum Exporting Countries (OPEC), Permanent Court of Arbitration (PCA), United Nations (UN), United Nations Conference on Trade and Development (UNCTAD), United Nations Educational, Scientific and Cultural Organisation (UNESCO), United Nations Industrial Development Organisation (UNIDO), Universal Postal Union (UPU), World Federation of Trade Unions (WFTU), World Health Organisation (WHO), World Intellectual Property Organisation (WIPO), World Meteorological Organisation (WMO), International Organisation for Standardisation (ISO).

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ECONOMY

Basic Economic Facts

GDP: $84 billion (IMF World Economic Outlook)
Inflation: 5.1% (IMF World Economic Outlook)
Major trading partners: US, Turkey, Syria, India, Italy, China, South Korea, Taiwan, Jordan
Major industries: Petroleum, Chemicals, Textiles, Construction materials, food processing, fertilizer

During the past three decades the Iraqi economy suffered from costly militarisation, three wars, pervasive state intervention, and over a decade of international sanctions.

The rebuilding of the Iraqi economy since 2003 has been hard and much work remains. Mismanagement and embezzlement were rife under Saddam Hussein. The oil sector was starved of investment, and the Saddam regime built up huge debts through costly wars with Iran and Kuwait. Infrastructure, public services and industry suffered, unemployment was very high, and Iraqis were heavily dependent on the state free-food ration.

Since May 2003 there has been a significant post-war economic and financial recovery: Iraq's GDP rebounded quickly, growing at 4.4% p.a. from 2005-2010 (IMF World Outlook).

Energy is key. Iraq holds the fourth largest proven oil reserves in the world (115bn barrels, 9 per cent of global reserves, BP Statistical Review of World Energy 2010). However its potential reserves are unknown and widely believed to be the world's second largest reserves after Saudi Arabia. Iraq has very ambitious plans to grow exports from a little over 2 million bpd now to 12 million by 2017.

However its high dependency on oil makes the economy vulnerable to fluctuations in the oil price and to sabotage attacks on oil infrastructure. Oil is traded in US dollars, so exchange rate policy is important, and the Central Bank has managed to maintain stability, build reserves and keep inflation at manageable levels.

Economic diversification will therefore be important in the long term, doubly so because Government expenditure is 99.7% of GDP (IMF World Outlook). Iraq’s other natural resources could provide a basis to do so. However it is a profoundly difficult environment for private business to break into. Outdated laws and structures plus significant corruption mean Iraq ranks 153rd of 183 countries in terms of overall ease of doing business in the World Bank’s “Doing Business 2010” report. Border bureaucracy and financial regulation hinder foreign investment and trade, though last year Iraq managed exports of $49b and imports of $43b (CIA World Factbook).

While Iraq continues to improve at a macro level, citizens’ experiences remain hard. Service delivery is haphazard. Electricity generation has long been half demand and industry must supply itself. The population is youthful and unemployment high (estimates vary around a third). Poverty is broad and, though shallow nationally, deep in rural areas. Drought, desertification and stressed water supplies will continue to undermine agriculture, and a fifth of the population remain dependent on the food ration system (UN Common Country Assessment 2009).

Iraq has created a National Development Plan for 2010-2014 and a National Investment Plan to deliver these needed services and sustained growth. For now, the oil sector will provide the basis for growth and stability in the medium term and security is the key to continued revitalisation in the short-term. Provided Iraq can continue to manage security and successfully co-ordinate investment for oil development it should continue its growth towards long-term prosperity.

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HISTORY

Mesopotamia (modern-day Iraq) was one of the great centres of early civilisation. Iraq was one of first places in which irrigated agriculture developed. It also saw the emergence of the first towns (Ur, Ugarit) and the development of writing, accounting and the codification of laws.

Over its 5,000 years of recorded history, many states and empires have come and gone in Iraq. From 550 BC until 637 AD, Iraq was ruled by empires of Persian origin (Achaemenid, Parthian and Sassanian). In 637 AD, however, Iraq was conquered by Arab Muslim armies. And from 750 until the Mongol conquest of 1258, Baghdad was the capital of the Abbasid Empire, one of the greatest Islamic empires. Under the Abbasids, Iraq became a great seat of learning and civilisation – very much in advance of Europe at that time.

From 1535 until the First World War, Iraq formed part of the Ottoman Empire. During that war, British forces drove the Ottomans out of Iraq and took over the country. Iraq remained under British control until 1932, as a Mandate of the League of Nations.

In 1968, a coup brought the Baath Party to power in Baghdad. Saddam Hussein took over as President in 1979.

During the 1970s, Iraq developed rapidly, using the surge in oil income after 1973. This was a period of prosperity with an increasing role for women. But those who crossed the regime were viciously repressed.

In 1980, Iraq invaded Iran. The war with Iran, which lasted until 1988, cost the two countries around 500,000 lives. Iraq emerged from the war in severe financial difficulties.

In August 1990, partly to resolve its financial crisis, Iraq occupied Kuwait. US-led coalition of forces from some 30 countries ejected Iraq from Kuwait in early 1991.

Following Iraq's defeat during the Gulf war, serious unrest broke out in parts of the country. An uprising by the Shia in the south of the country was quickly crushed by troops loyal to Saddam. An attempt to do the same to a Kurdish uprising in the north was thwarted by international intervention, which established a ‘safe haven’. No-Fly Zones were put in place over both northern and southern Iraq. A Kurdistan Regional Government was set up in 1992.

During the 1990s, Iraq was the subject of UN resolutions, both during and after its occupation of Kuwait. These resolutions imposed sanctions on Iraq. A number of the UN resolutions concerned Iraq’s weapons of mass destruction: a regime of inspections was set up, with a view to finding and destroying these weapons. However, Iraq persistently obstructed the work of the UN inspectors. As a result of its defiance of the international community, the sanctions imposed on Iraq remained in place.

In March 2003, a coalition led by the US and UK commenced military action against Iraq. Initially, Iraq was under direct coalition control, through the Coalition Provisional Authority (CPA) which was assisted QQ CORRECT TERM? by the Iraqi Governing Council, an appointed body. In June 2004, the CPA handed Iraqi sovereignty over to an appointed council, the Iraqi Interim Government.

Over succeeding years, despite a serious insurgency and widespread sectarian violence, Iraq became progressively more independent and more democratic. In January 2005, a Transitional National Assembly (TNA) was elected. In December 2005, national elections for a new Iraqi parliament (the Council of Representatives) took place under a new constitution (which had been put to a referendum in October 2005 and adopted). In May 2006, Nuri al-Maliki took office as Prime Minister.

Elections for a new Council of Representatives were held in March 2010. Following protracted negotiations, an inclusive government of national unity took office under Nuri al-Maliki in December 2010.

Iraq progressively regained control of the country’s security too. Starting with Muthanna Province in July 2006, coalition forces handed over control of security to the Iraqi authorities, province by province. The last British troops left Iraq in May 2011; the last US troops left the country in December of the same year.

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INTERNATIONAL RELATIONS

UK diplomatic representation in Iraq

The British Embassy reopened in Baghdad on 28 June 2004. Owing to security concerns, the current Embassy is situated in the 'International Zone', which contains many Government and diplomatic buildings. There is also a Consul General in Basra in southern Iraq and a Consul General in Erbil in the northern Kurdistan region.

Iraqi diplomatic representation in the UK

Dr Muhielddin Hussein Abdullah is the current Chargé d'Affaires in London.


Cultural Relations with the UK

Talented Iraqi graduates and young professionals are able to apply for scholarships to study in the UK under the British Chevening Scholarships scheme. The scholarships, funded by the Foreign and Commonwealth Office and administered by the British Council enable Iraqis from a wide range of sectors to gain skills to help contribute to the reconstruction of their country. Further details on the general Chevening programme can be found on www.chevening.com (http://www.chevening.com) .

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GEOGRAPHY

The Republic of Iraq is bounded to the north by Turkey, to the east by Iran, to the south-east by Kuwait and the Gulf, to the south and south-west by Saudi Arabia and Jordan and to the north-west by Syria. A short coastline of 56km gives it access to the Gulf.

Iraq has three distinct topographical regions: the north-east uplands and Kurdistan Mountains, the almost barren desert plains of the north-west and south, and the irrigated, heavily farmed Mesopotamian plain south of Baghdad between the rivers Tigris and Euphrates. Elevations range from sea level in the south-east to 3,700m in the north-east. Apart from the mountains in the north, almost all of Iraq is less than 500m in altitude.

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TRADE AND INVESTMENT

With the UK

The long-term future of Iraq depends upon the revival of its economy, and reintegrating Iraq within the global trading system.

The Government wishes to see UK companies play a substantial role in the reconstruction of Iraq's essential infrastructure. British firms are active in Iraq in a range of sectors, including power, water, health, telecommunications, oil & gas, construction and education & training. UK Trade & Investment will continue to work with and advise British business how they can best contribute to the development of Iraq for the benefit of the Iraqi people. There are commercial sections within the British Embassy in Baghdad and Amman, Jordan as well as in the Office of the British Embassy in Basra and the Consul General in Erbil.

For further enquiries, please telephone UK Trade and Investment's Iraq Enquiry Unit on 020 7215 8893 or email iraqunit@uktradeinvest.gov.uk

UK Trade & Investment Country Profile: Iraq (http://www.uktradeinvest.gov.uk/ukti/iraq)

UK Development Assistance

UK Development Assistance in Iraq (DFID website) (http://www.dfid.gov.uk/countries/asia/iraq.asp)

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POLITICS

The second parliamentary elections since the downfall of Saddam’s regime took place across Iraq in March 2010, to elect 325 members of an expanded Council of Representatives (parliament). Political parties and blocs from across Iraq’s political and ethno-sectarian spectrum took part. Despite attempts by insurgents to disrupt polling, the election passed off generally peacefully and turnout was around 64% of the population.

There was no clear winner in the election. The Iraqiyya bloc of Dr Iyad Allawi won 91 seats. The State of Law coalition led by the incumbent Prime Minister, Nuri Kamal Al-Maliki, took 89 seats. The election was followed by a protracted period of government formation with Mr Al-Maliki remaining as caretaker Prime Minister. Final agreement on a government remained elusive, with no agreement on the distribution of key ministries, while the main political blocs manoeuvred to construct wider coalitions to give them a parliamentary majority.

In late 2010, the President of the Kurdistan Regional Government, Massoud Barzani, launched an initiative to break the political deadlock. The so-called Erbil Accords envisaged a power sharing arrangement between the major Shia, Sunni and Kurdish blocs. This saw Mr Al-Maliki, a Shia, remain as Prime Minister, while Jalal Talebani, a Kurd, stayed as Federal President. The influential position of parliamentary Speaker went to a Sunni, Dr Usama Al-Nujaifi.

Following the expiry of the Iraq/US military agreement, all US troops left Iraq on 19 December 2011.
Iraqi politics remain delicate against the background of allegations of involvement in terrorism against the Sunni Vice President Tareq Al-Hashemi (the subject of ongoing judicial proceedings), and tensions between Prime Minister Al-Maliki and Deputy Prime Minister Saleh Al-Mutlaq. A national dialogue among political blocs is attempting to resolve political differences. The political impasse has affected the ability of the parliament and government to engage fully in dealing with the range of pressing issues facing Iraq, though did pass a Federal budget in February 2012.

The next parliamentary elections are scheduled for 2014.

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HUMAN RIGHTS

Iraq continues to deal with the legacy of decades of appalling human rights violations under Saddam Hussein’s regime, as well as institutional deficiencies. The security context in which Iraq operates remains a challenging one. Significant problems remain, in particular with the administration of justice and the rule of law. Corruption remains widespread. Unemployment and a lack of access to basic public services continue to affect large numbers of the Iraqi population.

In February 2010 the Government of Iraq made clear their commitment to human rights at the UN Human Rights Council Universal Periodic Review, where it accepted a number of recommendations from the UK and other countries. The Council of Ministers has approved a National Action Plan which sets out the Government of Iraq’s vision and work plan for implementing these recommendations. The promotion of human rights plays a major part in our overall security strategy agenda for Iraq and we stand ready to support the Government of Iraq in taking these recommendations forward.

We believe it is important for Iraq to have robust institutions, a free and independent media and an active civil society which can help ensure that human rights are respected in the country. In particular we look forward to the establishment of the Independent High Commission for Human Rights, in line with Iraq’s Universal Periodic Review Recommendations.

The UK has funded a number of projects to promote human rights across Iraq. These include the development and delivery last year of training programmes for the police and women’s shelter staff in the Kurdistan Region on Gender Based Violence cases. We have also worked with the KRG to make changes to legislation to ensure it takes into account women’s rights issues. We hope to work with the Government of Iraq in 2012 in helping amongst other things to strengthen the rights of women across Iraq as a whole.

We continue to work on our priorities as defined in our human rights programme strategy, in cooperation with civil society and the Government of Iraq.

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Last Updated: March 2012

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