WHEN DO WE GET OUT OF THE RENTIER ECONOMY?

WHEN DO WE GET OUT OF THE RENTIER ECONOMY?

When do we get out of the rentier economy?

Jawad Al-Attar

The World Bank’s report on Iraq’s economic situation for the second half of this year and the first half of next year, released a few days ago, may be overlooked in the daily news cycle. However, it undoubtedly sounds alarm bells, as the economy is a fundamental component of any country’s national security architecture.

Although government advisors downplayed the report’s significance, asserting that Iraq’s economic situation is robust and capable of overcoming any obstacles or shocks in global oil prices, the Ministry of Finance responded seriously to the report and is moving within a framework that may temporarily extricate us from the crisis. This includes approving budget schedules for the second half of this year that secure funding for salaries and ongoing projects, along with partial payments to investors and a relative deficit based on an oil price of $60 per barrel.

However, the question remains: When will Iraq’s economy decouple from global oil prices? And when will we emerge from the crucible of a rentier economy?

These questions should be addressed by experts and decision-makers, and the country’s politicians should bear the responsibility for accomplishing these tasks by, first, operating productive public sector companies; second, facilitating routine procedures for the private sector and foreign investors; through real decisions, not ink on paper; third, diversifying sources of income; through regulated irrigation agriculture, complementary and transformation industries, and balanced inter-trade with neighboring countries; and fourth, providing the enabling environment and requirements that meet the above requirements; in the shortest possible time.

A country that has managed to oust the occupation and defeat terrorism is capable of overcoming economic crises and achieving growth if the political will is realized and politicians overcome their differences, their pursuit of privileges, and their desire to win elections.