Commercial Good experience

The Tricky Business of Rebuilding Iraq

Deterioration of Iraqi infrastructure started with the war against Iran and the invasion of the US that accelerated the damage. After the war, the country was left destroyed and in massive debt. The former regime under President Saddam Hussein instead of focusing on building the country’s economy and infrastructure worsened the condition of the country when he invaded Kuwait in 1990. That opened a long confrontation that had a massive setback to the country power plants, bridges, factories, roads, and other significant structures.

Later, in 2014, the country had another security setback from self-proclaimed Islamic State Iraq and Syria (ISIS). What happened after was loss of lives, citizens running to safer places, and an increase of infrastructure destruction escalated. It was easy to destroy than the rebuilding process, which is costly to the country. However, the country is trying very hard to restore investors’ confidence, especially foreign companies.

 Investment

The rebuilding of Iraq is full of challenges and one being security problems that many investors fear. Business risks operating in Iraq as the country have fragile institutions and lack of proper governance. The country has a lot of potential in attracting foreign investors. Iraq has the fourth-largest oil reserve in the entire world, but even that the country is lagging in many areas instrumental in accelerating the rebuilding process. For instance, the Iraq government is implementing laws at a snail’s pace, especially institutions that are needed to enforce economic policies.

Corruption

In 2018, the Iraq reconstruction conference was held in Kuwait, aiming for potential donors to invest and discuss plans to rebuild the country’s economy and infrastructure. The meeting was successful, and donors pledged over $30 billion in credits and investments. Until today, the majority of donors who had pledged have yet to transfer the funds. The core reason for the delay and honoring of pledges was corruption concerns, transparency, and accountability. Some pledges were pegged on conditions for funds to be released; they were to be allowed to supervise the usage.

The rebuilding hope remains to be seen since the much anticipated Kuwait conference agreement ended in disappointment. It is up to the government to put effort into affirming investors’ confidence and assuring them by showing the effort to fight corruption. The war-affected 80% of the country’s infrastructure, and it is in dire need for reconstruction. Iraq’s revenue is not enough to reconstruct the country’s infrastructure. According to the situation on the ground, Iraq requires to rebuild beyond buildings, roads, bridges, and industries to focus on reconstruction of the society as well. The society is the first casualty of conflicts and violence. It, however, should start with them and build a peaceful coexistence among various ethnic groups.

Lack of Finances

The most pressing issues in Iraq are financial challenges. The country is said to operate below $100 billion that comes from oil sales and is barely enough to cater to serious problems the country needs to handle. Economic prosperity is the only key that can guarantee Iraq and the people of a better future for all. But they must come together and work in unity. The country has a vision 2030 when it will be able to have enough funds maximally rebuild the ruins. Other areas such as tourism, trade, agriculture, transportation, and others are some of the things that can help reconstruct Iraq to its former glory.

Conclusion

It is ironic that Iraq, a country known to be among the leading in oil production yet struggles to rebuild its destroyed infrastructure. The country depends on oil, and that may not be stable at all times. Therefore, Iraq needs to find other sources of income away from oil or be forced to depend on foreign aid, a public-private partnership with international companies and loans.

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