The Economy
Though chaotic, riddled with corruption and dogged by unemployment and inflation, the Iraqi economy is in a far better shape than it was in the aftermath of the 2003 US-led invasion, when it had come close to a complete breakdown. The government has since been able to build up surpluses, thanks chiefly to crude exports. Baghdad is also under pressure to disburse more government funds and invest more heavily in infrastructure. Oil forms an overwhelming chunk, almost 95 per cent of the Iraqs budget revenues and remains critical to the development and reconstruction of the war-torn country.However, there are some brighter spots. Iraqs GDP is set to grow at the rate of 13.5 percent this year, fuelled by increased oil production. Substantial investment is required in the oil and gas industry. Despite complains of meagre terms on offer, the second oil auction held in 2009 was hailed as a major success after firms such as China National Petroleum Company and Russias Lukoil were awarded contracts to develop major fields. In 2011, oil giant Shell signed a $17 billion gas development contract, while in mid-2012 Lukoil was reported to be in talks with American oil and gas company ExxonMobil to take a share in Iraqs huge West Qurna oilfield. An ongoing spat between the regional Kurdish government in the north and the central government in Baghdad over export contracts has made some oil firms wary of investing.
Politics
On the tenth anniversary of the US Invasion of Iraq, more than 50 people were killed in a wave of bombings, allegedly carried out by an Al Qaeda linked militant group. The incident shows the challenges left by the legacy of the invasion and the huge task facing the country torn apart by sectarianism. Most foreign assets are still considered at risk. The withdrawal of US forces under president Obama, which was completed in December 2011, is a key test of the new politics that has emerged and the strength of the Iraqi armed forces. However, the withdrawal coincided with a spate of bombings, which served as a reminder of the challenges to come. Iraqi prime minister Nouri al Maliki has developed into a surprisingly adept leader, seeing off jihadist insurgents and rival groups, including Shia supporters of Moqtada al Sadr.
| Sovereign ratings | ||
| Standard and Poors | na | na |
| Moodys | na | na |
| Fitch Ratings | na | na |
