World Grain - September 2024 - 16

COUNTRY FOCUS
KEY FACTS
FOCUS ON
IRAQ
Government encouraging
local flour production
by Susan Reidy
Traditionally a major importer of wheat flour, Iraq is taking
measures to boost its local production and reduce reliance on
imports.
The government has approved the local sale of wheat to licensed
public and private mills at prices equivalent to the import
price and imposed a gradually increasing customs tariff on
imported flour.
As a result, the International Grains Council (IGC) said flour
imports in 2024-25 are estimated to drop to a decade low. Still,
the country is expected to remain the world's second largest importer
of flour. Wheat imports also are expected to drop from
last year and the five-year average as domestic production increases.
Agriculture
is a significant part of Iraq's economy, accounting
for about 10% of gross domestic product and employing
8.4% of the workforce. About 22% of the country's land mass
is suitable for agriculture production but only 5 million hectares
are cultivated, according to the World Food
Programme. A large portion of the agricultural
lands are under irrigation, but it
still depends on rain-fed agriculture
for grain and sheep production,
according to the Food and Agriculture
Organization (FAO).
Crop production is the
major source of income for
farmers, about 75%, while
the rest rely on livestock or
a mix of the two. Key crops
include barley, wheat, rice
and corn (maize).
Years of war and social
unrest have caused severe
constraints across the agriculture
value chain, including
restricted access to land due to
violence; internal population dis16
Capital:
Baghdad
Population: 42,083,436
Religions: Muslim (official) 95%-98% (Shia 61%64%,
Sunni 29%-34%), Christian 1% (includes Catholic,
Orthodox, Protestant, Assyrian Church of the
East), other 1%-4% (2015 est.).
Location: Middle East, bordering the Persian Gulf,
between Iran and Kuwait.
Government: Federal parliamentary republic.
Chief of state: President Latif Rashid (since Oct.
13, 2022); head of government: Prime Minister
Mohammed Shia al-Sudani (since Oct. 27, 2022).
Economy: Iraq is one of the most oil‑dependent
countries in the world. Over the last decade, oil
revenues have accounted for more than 99% of exports,
85% of the government's budget, and 42%
of gross domestic product (GDP). This excessive
dependence on oil exposes the country to macroeconomic
volatility, while budget rigidities restrict
fiscal space and any opportunity for countercyclical
policy. The economy is gradually recovering
from the oil and COVID‑19 shocks of 2020. This
recovery is fraught by major risks posed by structural
bottlenecks. Risks include public investment
management constraints that have affected public
service delivery, the slow clearance of arrears (especially
those related to public wages) and large
exposure of state‑owned banks and the central
bank to the sovereign. These fragilities are aggravated
by fragile political conditions, a weak health
care system and rampant corruption that continue
to trigger unrest across the country. Higher
projected oil prices through 2024 are forecast to
keep Iraq's fiscal and external balances in surplus.
Iraq's economic outlook remains subject to significant
risks. The recent geopolitical tensions related
to the war in Ukraine highlight risks for Iraq's
economy. While any further oil price hikes would
improve Iraq's fiscal balance, rising food prices
and disruption to agriculture imports will exacerbate
pre‑existing poverty trends and increase food
security risks. The conflict also poses risks to Iraq's
crude oil production if operations of Russian oil
companies in Iraq are impacted by international
sanctions on Russia. Higher oil prices could hurt
the longstanding need to reform, thereby deepening
Iraq's structural economic challenges. Further
intensified climate change effects and water shortages
will decrease agricultural production.
GDP per capita: $12,600 (2022); inflation: 4.99%
(2022 est.); unemployment: 15.53% (2023 est.).
Currency: Iraqi dinar (IQD); 1,310 Iraqi dinars
equal 1 US dollar (Aug. 20, 2024).
Exports: $127.079 billion (2022 est.): crude petroleum,
refined petroleum, gold, petroleum coke,
natural gas (2022).
Imports: $69.162 billion (2022 est.): refined petroleum,
broadcasting equipment, cars, jewelry, garments
(2022).
Agriculture: 10% of GDP (2023) and 8.4% of the
labor force (2022).
Internet: Code: .iq; 21.56 million (2021 est.).
Source : CIA World Factbook/World Bank/
International Trade Administration
September 2024 / World Grain / World-Grain.com
http://www.World-Grain.com
World Grain - September 2024

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