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Business Profile
Economy: The Iran-Iraq war, which lasted from 1980 until 1988, brought Iraq’s steady growth to a halt. The international sanctions imposed following the Iraqi invasion of Kuwait in August 1990 then forced the economy into reverse. Only the agricultural sector held up as Iraq sought to grow more food in order to compensate for the absence of imported produce. Light industry, which the Government originally promoted as part of an import substitution programme, operated far below the levels of the 1980s. The key was the oil industry. Under the terms of UN sanctions the Iraqis were allowed to sell US$2 billion of oil every six months to buy food and medical items. However, by 2001, the Iraqi government had developed sufficient ‘illicit’ markets outside the constraints of sanctions that it was prepared to announce that it was no longer prepared to subscribe to the agreement and withdrew its product from the official international market.
Iraq’s main pre-war trading partners were the USA, Germany, Turkey, the UK, Italy and France. Iraq has a huge foreign debt, mostly owed to Saudi Arabia and Kuwait, incurred chiefly during the war with Iran; it also suffered several bouts of hyperinflation during the 1990s as the value of the Iraqi dinar plummeted. Given the huge damage to its physical and social infrastructure, it may be several decades before Iraq returns to the level of development which it enjoyed in the mid-1980s. After its initial calamitous decline, the performance of the Iraqi economy has been comparatively stable: the fluctuations – GDP contraction of two per cent in 2002, followed by projected six per cent growth in 2003 – are almost entirely the result of conditions in the world oil market.
Business: Formal courtesies are common and expected. Visiting cards are regularly exchanged and these are often printed in Arabic and English. Meetings may not always be on a person-to-person basis and it is often difficult to confine items to the business in progress as many topics may be discussed in order to assess the character of colleagues or traders. Office hours: Sat-Wed 0800-1400; Thurs 0800-1300. Friday is the weekly day of rest when offices tend to be closed.
Commercial Information: For information or advice contact the Federation of Iraqi Chambers of Commerce, PO Box 11348, Mustansir Street, Baghdad (tel: (1) 888 8850; fax: (1) 888 2305) or the Baghdad Chamber of Commerce, PO Box 24168 Almsarif, Baghdad Almustansir Street, Baghdad (tel: (1) 887 6211/1; fax: (1) 887 9563).
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