Iraq Economic Forecast

Iraq Economic Outlook

November 27, 2018

The economy grew strongly in H1 2018 thanks to elevated oil output and prices in anticipation of punitive U.S. sanctions imposed on Iranian exports. Oil production remained strong in the third quarter, boding well for sustained economic growth. However, oil revenues are likely to moderate going forward after President Donald Trump unexpectedly granted waivers to key buyers of Iranian oil. This, coupled with sustained booming U.S. production, have both significantly weighed on prices in recent weeks, although a likely OPEC output cut should stabilize prices. Meanwhile in the political arena, discussions on filling vacant ministerial posts continued in late November, further delaying the government’s ability to implement reforms to support the economy after years of armed conflict.

Iraq Economic Growth

Although the oil sector’s future performance is uncertain, it should nonetheless continue to support the economic recovery next year, reinforced by reconstruction work. Political gridlock and a potential resurgence of armed conflict, however, cloud the outlook. FocusEconomics panelists expect growth of 4.8% in 2019, which is up 0.2 percentage points from last month’s forecast and 3.9% in 2020.

Iraq Economy Data

20132014201520162017
Population (million)33.436.036.937.938.9
GDP per capita (USD)7,0426,6214,8514,548-  
GDP (USD bn)235238179172-  
Economic Growth (GDP, annual variation in %)6.60.74.811.0-  
Industrial Production (annual variation in %)5.06.722.28.0-  
Unemployment Rate7.97.67.78.08.2
Fiscal Balance (% of GDP)-5.8-5.4-12.3-13.9-  
Public Debt (% of GDP)31.232.055.164.4-  
Inflation Rate (CPI, annual variation in %)1.92.21.40.40.2
Policy Interest Rate (%)6.006.006.004.004.00
Exchange Rate (vs USD)1,1651,1431,0961,1821,185
Exchange Rate (vs USD, aop)1,1631,1631,1481,1711,177
Current Account (% of GDP)9.610.2-1.12.1-  
Current Account Balance (USD bn)22.624.4-1.93.6-  
Trade Balance (USD billion)30.426.83.37.118.8
Exports (USD billion)89.885.451.341.357.6
Imports (USD billion)60.154.448.034.338.8
Exports (annual variation in %)-4.7-4.9-39.9-19.539.4
Imports (annual variation in %)0.6-1.3-18.1-28.713.3
International Reserves (USD)77.766.353.544.948.9
External Debt (% of GDP)25.224.436.939.2-  

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Iraq Facts

ValueChangeDate
Exchange Rate1,1930.0 %Dec 12

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