Rich government, poor country

17 January 2008 By Martin Hutchinson

The IMF expects Iraq s economy to grow 7% in 2008. However oil, its main resource, is controlled by the government. With government revenues at 80% of GDP, there s not much room for the private sector. Saddam impoverished Iraq. Sadly, it s likely to stay that way.

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The International Monetary Fund expects Iraq's economy to grow 7% in 2008, with low inflation, as oil production increases a further 10%.

Iraq's gross domestic product at the official exchange rate was $40.7bn in 2006, and probably grew around 5% in 2007. Inflation in 2006 was 53%, in 2007 about 20%. Its population is 27m, growing at 2.6% per annum.

Iraq ranked number 178 out of 180 countries on Transparency International's Corruption Perceptions Index in 2007.

Iraq has 116bn barrels of proven oil reserves, plus an estimated 100bn in new formations found in the Sunnicontrolled Western desert. Its oil production capacity was 3.6m barrels/day in the 1980s. It is currently producing about 2m barrels/day, up from 1.5m in 2006 and expected to increase to 2.2m in 2008.

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