IRAQ’S OIL WEALTH: A STARK CONTRADICTION BETWEEN POTENTIAL AND SOCIAL REALITY WITH COMMENTS OF MNT GOAT, 8 JAN

 IRAQ’S OIL WEALTH: A STARK CONTRADICTION BETWEEN POTENTIAL AND SOCIAL REALITY

Although Iraq is one of the most prominent oil producing and exporting countries in the world, the social and economic reality in the country shows a stark contradiction between the enormous potential and the increasing levels of poverty.

(Yet, it is documented that trillions of dollars not dinars, has been stolen from the Iraqi people since the 2003 invasion. The goose with the golden eggs era is over! )

This contradiction raises questions about the shortcomings in resource management and the mechanisms that prevent oil revenues from being translated into tangible welfare for citizens.

Multidimensional poverty: more than just numbers

Poverty is no longer measured by individual income; the severity of deprivation in daily living requirements is a more accurate measure. This deprivation includes sectors such as education, health, and living services.

In Iraq, the percentage of poor people is 23.4% of the population according to last year’s statistics, compared to 22% in 2000, which means that the number of poor people has doubled from five million to ten million people over the past two decades.

But these figures do not reflect the full picture. In southern areas such as Muthanna and Diwaniyah, the poverty rate exceeds 50%, while it drops to only 5% in Sulaymaniyah. This gap highlights regional disparities in the distribution of resources and services, which exacerbates the feeling of deprivation in some governorates.

Causes of worsening poverty: financial corruption and structural crises

Iraq used to suffer from poverty due to the economic blockade and weak economic activities. Now, financial and administrative corruption is the main reason, as oil revenues are wasted on ineffective projects or leaked into the pockets of the corrupt. Although oil revenues have increased fivefold since 2000, the rentier economic system and the lack of economic diversification have increased the state and society’s dependence on oil, without developing other sectors such as industry and agriculture.

In the education sector, 3.2 million Iraqi school-age children are out of school, due to financial distress and lack of infrastructure. In the health sector, while some suffer from malnutrition, food waste rates are high due to consumption habits. This paradox reflects weak planning and poor control of resources.

Electricity services are a chronic crisis in a country with the world’s fifth-largest oil reserves. Despite state subsidies for energy prices, citizens are forced to rely on expensive private sources due to frequent outages. This gap between government supply and actual demand burdens poor families.

To reduce poverty, Iraq relies on tools such as the Social Fund for Development, social welfare, and food rations.

But these tools face major challenges, such as poor funding, corruption, and the inability to reach all those who deserve it.

Iraq can benefit from successful international experiences, such as the Chinese experience, which focused on creating job opportunities by exploiting economic growth, or the experience of other countries that relied on improving basic services.