China’s economic presence in Iraq: challenges and survival strategy

Thanks to its growing involvement in the Iraqi market, China continues to reinforce its economic influence in the Middle East. Over the past years, China has taken advantage of the country’s precarious situation to gain even more power over global governance and secure its energy supply. Justine Mazonier tries to decipher this situation.

Foreign direct investment: Iraq at the crossroads of geo-economic issues in the Persian Gulf

Preview Since the start of the conflict against the Islamic State, foreign direct investment in Iraq has steadily fallen. Despite the country's strong potential and oil resources, foreign investors are still reluctant to enter this market of 40 million consumers. Iraq is struggling to evolve into a competitive market economy with a vibrant private sector. Instead, the country continues to be plagued by pervasive state control of economic activities, Dutch disease, political instability, security problems and corruption. More importantly, the Iraqi economy is heavily influenced by external interference, particularly from Iran. This situation deprives Iraq of economic opportunities with the Gulf States and Western countries. The current situation of economic crisis and high inflation is forcing the new Iraqi government to make a choice between its trading partners with opposing interests.