The long troubled Middle East is going through a major transition for the first time in over twenty years without major involvement from the US. Despite its u turn policy to refrain from any involvement in the Middle East, The US still retains a presence in Iraq although far more low key while the newly formed Iraq government continues to move forward with its attempts to stabilise the country, provide jobs and improve their damaged infrastructure.
Rocked by ISIS insurgence, disruption efforts by Iran and multiple internal conflicts an already fragile nation saw the price of Oil drop from and average of $96 per barrel in 2014 to lows of $36 in 2016. While the price of oil has rallied, total export revenue is still down over 50% compared to pre-ISIS leaving Iraq struggling to invest what is needed to repair the country’s infrastructure.
What is required to rebuild Iraq’s infrastructure
Research by the US National Research Council suggests that the countries ‘hard’ infrastructure (roads, bridges, rail, clinics etc) requires an investment of around $88 billion. This is before they event attempt to tackle the ‘soft’ infrastructure (government, policies, management and practices) and the severe shortage of skilled workers to tackle these challenges. To put the scale of this challenge into perspective, the estimated cost alone to repair or replace all of Iraq’s bridges is in excess of over $2.6 billion alone.
How did this happen?
The troubles date back to 1980 and the start of the Iran – Iraq conflict. Much of Iraq’s infrastructure including oil pipelines, roads and electrical infrastructure were destroyed. This was just the start of a long history of troubles. Since the 80’s Iraq has seen decades of conflict, insurgency and corruption. A long-standing policy of repair rather than replace has left the country with an aging, dilapidated communications system and electricity network. Water quality is a major issue compounded by toxic waste leaking into the ports from some 200 wrecked ships as a result of the conflict with Iran. A long lasting clean up operation is still ongoing.
What needs to be done?
The key to the economic stabilisation of Iraq is providing basic amenities for all citizens. This includes basic health care, access to medicines, extensive road re-building, access to clean water and the creation of jobs. Simple jobs of transporting medical supplies, building materials and workers are still an issue in many regions outside of Baghdad. Its estimated that about 50% of Iraq’s labour force is employed by the government and only around 3% employed by the private sector. This lack of competition only feeds the corruption and inefficiency within government. Widespread corruption needs to be tackled all the way to the top of government.
Many Iraqis are living without access to basic health care and fresh water. With the majority of construction costs being paid for by the government and decisions on where investment is being made and what contractors are employed being made by government officials to opportunity for misappropriation of funds, underperforming projects and lack of investment in rural areas is a huge problem.