Baghdad, Iraq, twenty seventh June 2024, As a consequence of sanctions imposed on Iraq’s banking sector for varied causes, each the economic system and personal sector are hindered from reaching their full potential. In right this moment’s digital economic system, centred on on-line transactions and digital interactions, Iraq’s banking sector has predominantly centered on conventional profit-making strategies, notably by foreign money trade with the federal government.
The retail banking facet stays very restricted attributable to intensive paperwork, rigorous due diligence necessities, and slender revenue margins. Banks hesitate to develop their retail enterprise attributable to makes an attempt to revenue from shoppers who already lack monetary assets and face excessive unemployment ratios.
In response to Shwan Ibrahim Taha, CEO and founding father of Rabee Securities, an knowledgeable in Iraq’s finance sector, “excessive inflation poses a major challenge to Iraq’s monetary policy. The country’s heavy reliance on oil revenues for 93-96% of its financial income hinders economic diversification.”
“Iraq urgently needs infrastructure rehabilitation and improvements in its private sector to enable it to engage in larger projects and incentives. The International Finance Corporation (IFC) exemplifies the pivotal role that international funds and institutions can play in the country’s economy, provided stability, transparency, and partnership meet acceptable standards,” added Mr. Taha.
In response to IFC’s bulletins, since 2005, they’ve invested and mobilized greater than $1.9 billion to assist Iraq’s non-public sector. Lately, IFC launched a brand new program to assist 20 startups and join them with potential buyers. They’ve additionally invested $130 million within the Douh Cement Firm, signed an settlement with the Iraqi Inventory Market Authority to enhance market rules and supply advisory companies, and entered into an settlement with the Iraqi authorities to enhance and modernize Baghdad Worldwide Airport.