Iraq Economic Forecast

Iraq Economic Outlook

January 8, 2019

In the third quarter of 2018, the Iraqi economy grew at a meager rate over the same period a year earlier despite strong oil production and elevated prices for the black gold through late September. Oil production picked up noticeably in the quarter, but production moderated in October and November—partly due to bad weather in the Gulf region—which, coupled with plunging oil prices, will have dragged on the economy in the fourth quarter. In more positive news, oil exports jumped in December according to the oil ministry, despite the OPEC+ production curb. Exports benefited from the resumption of activity at the Kirkuk oil fields after a year of dormancy, which should provide some stimulus to the economy despite low prices.

Iraq Economic Growth

Downside risks remain abound. Iraq is a key supplier of oil to China, and a prolonged economic slowdown there would dent Iraq’s economy. Moreover, low oil prices risk Iraq’s postwar recovery and rebuilding efforts. A potential resurgence of armed conflict further clouds the outlook. FocusEconomics panelists expect growth of 4.6% in 2019, which is down 0.2 percentage points from last month’s forecast, and 3.4% 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 %Jan 14

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