Iraq, a wonderful country but full of problems related to Covid-19 pandemic

The economic, social and political situation in Iraq is turbulent.

To this situation must also be added the pandemic that is upsetting the whole world: COVID-19.

Currently in Iraq, according to data confirmed by the WHO (World Health Organization), there are 1,434 confirmed cases of coronavirus infection and 80 people dead.

Many experts think that there are many more, and this is very worrying because Iraqi hospitals are unable to cope with a serious health crisis and many citizens do not respect the travel restrictions introduced by the government.

Fortunately, since April 1, some NGOs such as Médecins Sans Frontières (MSF) have been supporting the Ibn al-Khatib Hospital in Baghdad (one of three facilities identified by the Ministry of Health for the treatment of COVID-19 patients in the city). MSF is also supporting the local health authorities in other areas of the country: Mosul, in the governorate of Ninewa, in the governorate of Erbil, as well as in the rest of Iraq.

The spread of COVID-19 adds to three other enormous problems that Iraq has and these are interrelated.

These problems are complex and articulated and it seems very difficult to find a solution in the short term.

Iraq in the midst of tensions between Iran and the United States

Iraq is at the centre of the tensions between Iran and the United States, which have increased since the beginning of January when the United States killed the powerful Iranian General Qassem Suleimani, former head of the Quds forces.

In these months the American troops, still present in Iraq, have suffered missile attacks that the United States attributes to armed militias supported by Iran as Kataib Hizbullah (an Iraqi Shiite paramilitary group that is part of the People’s Liberation Forces supported by Iran).

The United States is not satisfied with the response of the government of Mahdi (the former Prime Minister) to the attacks against the US military, and when the United States asked the government to react against Iran, many Iraqi officials accused the United States of meddling in Iraqi policy, violating its sovereignty.

The spread of the coronavirus also had military consequences: European and Canadian soldiers who were present in Iraq (as members of the coalition against ISIS) left because of the health crisis. In addition, the training of Iraqi troops by the US Army was suspended in order to avoid contagion.

Given the situation, the coronavirus may also favor what’s left of ISIS.

ISIS has, in fact, exhorted its members to take advantage of the growing confusion in Iraq, in fact, according to Michael Knights (Washington Institute) ISIS is the most prepared armed force for an epidemic because its members are downright prepared for death.

Economic Problems

Iraq, along with other countries in the Middle East and Central Asia region, will see a bigger contraction this year than the one observed during the 2008 global financial crisis and the 2015 oil price shock, the International Monetary Fund said Wednesday.

Overall economic growth in the region is expected to fall from 1.2% in 2019 to a 2.8% contraction this year, said the IMF.

Specifically, the IMF has stated that for Iraq, the gross domestic product (GDP) will decrease from 3.9% in 2019 to -4.7% in 2020 (IMF World Economic Outlook “The great lockdown”; April 2020). The same study stated, again regarding Iraq, that the current account balance will decrease from -1.2% in 2019 to -21.7% in 2020.

These figures, which describe the outlook for the Iraqi economy, are strongly affected by the collapse of exports and oil prices and this is a very serious problem for a country like Iraq, which has over 90% of its financial resources related to oil.

In fact, the price of oil has fallen sharply in recent months.

First, because Saudi Arabia had increased production (to the detriment of the United States and Russia); then because of travel restrictions to contain the coronavirus epidemic, demand has been greatly reduced.

Last week OPEC members (the main organisation of oil-producing countries) reached an agreement to reduce oil production in May and June to try to stop the price drop, but it is not necessarily enough for Iraq: the state has a big debt.

Already today the Iraqi state cannot afford to pay salaries to its employees and also to pay pensions to pensioners (we’re talking about 7 million people). For this reason, the Health Minister has asked for donations to finance care for people affected by COVID-19.

In Iraq the public sector is very important because the private sector is closely dependent on it, in fact, many private companies work only thanks to public contracts.

In addition, restrictions to combat COVID-19 have also reduced trade.

The situation is made even more complicated by the current political crisis because there is no government capable of taking measures to revive the economy.

The 2020 budget law, for example, cannot be passed until there is a new government, and in addition, this was written when the price of oil was much higher.

The internal political crisis

The current political crisis in Iraq began last autumn, with large and violent protests against Prime Minister Adel Abdul Mahdi. The protests were mainly about the high unemployment rate and the corruption of the country’s political class.

At the end of November, the protests had led to Mahdi’s resignation: since then Mahdi has remained in charge of current affairs. In the meantime, an attempt has been made to form a new government that can organize the early elections, as requested by the protesters, but with no result at the moment.

The first attempt was made by Muhammad Allawi, who did not obtain the support of the Shiite Muslim parties and militias linked to them.

The second attempt was carried out by Adnan Zurfi (who has American citizenship) and well seen by the United States because when he was head of the governorship of Najaf he had had a very tough approach with the Shiite militias. Zurfi also failed because he did not gain the support of the political factions closest to Iran.

On 9 April President Barham Salih appointed a new Prime Minister to form the government: the head of the secret service Mustafa al Kadhimi.

For him too, the challenge is to gain the support of the Shiite parties close to Iran, which are in disagreement with each other.

Mustafa al Kadhimi has thirty days to submit to Parliament his own choice of ministers and ask for a vote of confidence.

He has perhaps a better chance than his predecessor because at the beginning of April, Iranian General Esmail Qaani, head of the Quds forces (the special corps of Iranian Revolutionary Guards responsible for extraterritorial operations), during a visit to Iraq, invited the Shiite political parties to agree on a single candidate.

By: Michele Brunori