Life may get more difficult .. The economic situation is foretelling disaster in Iraq

Life may get more difficult .. The economic situation is foretelling disaster in Iraq

2/4/2021 13:49

Life may get more difficult .. The economic situation is foretelling disaster in Iraq[Baghdad-Where]
Experts have warned of the danger of the outbreak of unrest and popular protests in Iraq with the increasing rates of poverty, unemployment, the huge rise in prices and the government’s inability to pay the salaries of public sector employees.
According to the site “NPR”, the popular protests have rocked Iraq during the past year and a half. The largest of them was in Baghdad, but the southern city of Nasiriyah also witnessed large demonstrations and a sit-in that lasted for months, and while the strong crackdowns quelled the demonstrations, the anger was still simmering in the hearts of the people.
Activists say that the increasing poverty is one of the factors that keep the protests going, including Ziad Al-Asaad, who participated in many anti-government demonstrations, stressing: “The economic situation of all people in Nasiriyah and Iraq is getting worse day by day. We will witness more demonstrations .. more. Protests in the streets, squares and squares. ”
“Life may get harder”
For his part, political analyst Sajjad Jiyad said that “if the current situation continues, and oil prices remain low, there is a real possibility that more people will strike or protest, and things may become more difficult.”
Many shopkeepers in Baghdad complained about the poor conditions and the lack of buying and selling, since the value of the Iraqi dinar decreased by twenty percent against the US dollar in the past world.
Saad Salman, an owner of a sweets shop, said: “The rise of the dollar has devastated people. The purchasing power has decreased dramatically. He who used to buy a kilogram of sweets is barely buying half a kilo now.”
According to experts, the Iraqi economy has been suffering for a long time, but the recent period has increased its pain after the outbreak of the Corona pandemic, the decrease in oil exports, and the drop in oil prices, which has formed a crisis that is more like a disaster for a country that depends mostly on its income on exporting “black gold.”
The Ministry of Finance estimates that 7 million Iraqis (out of about 40 million citizens) receive government salaries or pensions. However, World Bank reports say that the number of these people decreased by 47.5 percent in the first eight months of last year. With the decline in oil revenues significantly, as the government has become paying its salaries and pensions intermittently or in some sectors, and sometimes it does not pay them at all.

Economists say that the poverty rate in Iraq may have jumped from 20 percent in 2018 to 30 percent or more last year, and although the government tried to encourage people to buy local goods to provide hard currency and thus increase money in the state’s treasury, this matter did not bear fruit due to the lack of goods. Local or its scarcity in many areas of life and living.
The owner of the sweets shop, Saad Suleiman, explained that the price of a bag of sugar increased by a third, and the price of walnuts nearly doubled. “Now, because of the high dollar and the lack of pensions and salaries for employees, there are two groups of people, a very poor class and a very rich class.”
“The situation is very bad.”
As for the expert at the International Energy Agency, Ali Al-Saffar, he describes the country’s economic situation as very bad, explaining that despite the impact of the Corona pandemic on many countries in the region, Iraq is the most suffering and its situation “the most dangerous and prone to unrest and instability.” Things in it. ”
Al-Saffar pointed out that the structure of the economy in his country has been shaky for decades, explaining that Iraq depends on oil for up to 98 percent of its revenues, and almost all of it goes to the state treasury, which made the public sector grow and penetrate at the expense of the private sector and become the main resource for securing jobs and employment .
For years, if not decades, economists have insisted that it is essential for Iraq to have a more diversified economy and a larger private sector, so that the livelihoods of many people are not dependent on high oil prices, but despite international development initiatives large and small, the private sector is still shrinking. In front of the state economy.
Government reform plan
Finance Minister Ali Allawi has a plan. “There has to be really a completely different approach to the way in which the government funds itself and the way in which resources are allocated between different sectors.”

His ministry unveiled a “white paper” last year to carry out radical economic reforms such as encouraging investment by improving Iraq’s infrastructure, increasing tax revenues, stimulating agriculture and manufacturing and adapting education to suit the needs of the global labor market.
Allawi acknowledged that many of these ideas are not new, adding: “Most of these plans faltered because there was no will to support them.” Oil money was pouring in, and the government “chose the line the easiest way to deal with crises.”
Currently, Allawi says, there is political and popular recognition that reform is necessary and will require hundreds of concrete steps that will be enacted over a period of 3 to 5 years, the first of which is the devaluation of the currency.
As for whether he was afraid of disturbances due to those measures that would be harsh in the eyes of many people, he replied: “There will be a losing class, but the beneficiaries will be many.”

alliraqnews.com