Current Situation
Iraq is rebuilding its economy after a prolonged period of instability and conflict, including reconstruction of infrastructure and government institutions, and resuming access to critical health and education services. Iraq and its partners are also investing in important sectors such as agriculture, transportation, communications, manufacturing, and construction to diversify the economy away from oil dependency and the history of institutional corruption that came with it. Though the investment environment varies by region due to ongoing sociopolitical challenges (including from the COVID-19 pandemic) and security concerns, the Iraqi Kurdistan Region is one area primed for investment, thanks to the adoption of a pro-business approach to reconstruction—including a focus on investment promotion and improving the business enabling environment. Amid this process of rebuilding Iraq’s economy there are significant opportunities for private investment, which will be backed by Iraq’s plans to direct its oil revenues into reconstruction and economic diversification. With greater stability and a return to economic growth, foreign investors and companies will also find opportunities to sell products and services to Iraq’s underserved, but sizable consumer market.
USAID’s Role
The United States is committed to supporting the reconstruction of Iraq into a sovereign, stable, and self-reliant country, including multi-billion-dollar investments into reconstruction efforts, supporting the development and responsible utilization of Iraq’s natural and human resources, and improving access to international markets. In fact, the U.S. is one of Iraq’s largest trading partners, and investment in Iraq by U.S. companies has increased significantly as the country continues to stabilize, especially in energy, information technology, automotive, and transportation sectors. Since 2003, USAID has been a major contributor to the U.S. Government's efforts to rebuild Iraq and develop a foundation for long-term peace, stability, and economic growth. USAID assistance has improved access to basic goods and services, accelerated the growth of enterprises, and helped the government to better represent and respond to the needs of the Iraqi people. More recently, USAID has supported the Iraqi private sector to weather the impacts of the COVID-19 pandemic.
