Iraq Economic Outlook
February 11, 2020
The economy likely lost steam in the fourth quarter. Oil production was down 2.4% year-on-year in the period according to EIA data, due in part to a temporary outage at the Rumaila field and as the country strengthened compliance with OPEC+ production cuts. Moreover, prolonged protests likely dented non-oil activity. This comes after a slowdown in Q3 on the back of weaker expansions in both the oil and non-oil sectors. On the political front, Mohammed Tawfiq Allawi was recently appointed as prime minister, several months after former Prime Minister Adel Abdul-Mahdi resigned over the government’s handling of the protests. Allawi must now form a cabinet and prepare for fresh elections, although a firm date for the vote has yet to be announced. The economic panorama is unlikely to change significantly, and anti-government protests look set to rumble on.Iraq Economic Growth
Growth is seen slowing this year on deeper OPEC+ production cuts and political instability. However, some reconstruction progress and a loose fiscal stance should support momentum somewhat. Downside risks to the outlook include Iran-U.S. tensions, which could spill over into conflict on Iraqi soil, a potential spike in social unrest and volatile oil prices. Our panelists forecast growth of 3.4% in 2020, which is down 0.3 percentage points from last month’s estimate, and 3.5% in 2021.Iraq Economy Data
| 2014 | 2015 | 2016 | 2017 | 2018 | |
|---|---|---|---|---|---|
| Population (million) | 35.0 | 35.2 | 36.2 | 37.1 | 38.1 |
| GDP per capita (USD) | 6,724 | 5,127 | 4,752 | 5,234 | 5,880 |
| GDP (USD bn) | 235 | 181 | 172 | 194 | 224 |
| Economic Growth (GDP, annual variation in %) | 2.3 | 1.7 | 9.6 | 0.8 | -1.0 |
| Industrial Production (annual variation in %) | 6.7 | 22.2 | 8.0 | - | - |
| Unemployment Rate | 7.9 | 8.1 | 8.1 | 7.9 | 7.9 |
| Fiscal Balance (% of GDP) | -5.6 | -12.8 | -14.3 | -1.6 | - |
| Public Debt (% of GDP) | 32.9 | 56.9 | 66.1 | 59.6 | - |
| Inflation Rate (CPI, annual variation in %) | 2.2 | 1.4 | 0.5 | 0.1 | 0.4 |
| Policy Interest Rate (%) | 6.00 | 6.00 | 4.00 | 4.00 | 4.00 |
| Exchange Rate (vs USD) | 1,143 | 1,096 | 1,182 | 1,185 | 1,193 |
| Exchange Rate (vs USD, aop) | 1,163 | 1,148 | 1,171 | 1,177 | 1,192 |
| Current Account (% of GDP) | 2.6 | -6.4 | -7.8 | 2.1 | - |
| Current Account Balance (USD bn) | 6.1 | -11.6 | -13.4 | 4.0 | - |
| Trade Balance (USD billion) | 35.6 | 11.0 | 12.2 | 25.4 | 48.4 |
| Exports (USD billion) | 85.4 | 51.3 | 41.3 | 57.6 | 87.3 |
| Imports (USD billion) | 49.8 | 40.3 | 29.1 | 32.2 | 38.9 |
| Exports (annual variation in %) | -4.9 | -39.9 | -19.5 | 39.4 | 51.6 |
| Imports (annual variation in %) | -7.4 | -19.1 | -27.8 | 10.7 | 20.7 |
| International Reserves (USD) | 62.8 | 50.9 | 42.0 | 45.6 | 60.6 |
| External Debt (% of GDP) | 24.7 | 35.3 | 38.2 | 35.7 | - |
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Iraq Facts
| Value | Change | Date | |
|---|---|---|---|
| Exchange Rate | 1,194 | 0.0 % | Jan 01 |
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