Iraq Economic News and Points To Ponder Monday Evening 7-20-26
$18B+ Spent On 2025 Iraqi Public Construction
2026-07-20 05:19 Shafaq News- Baghdad Iraq awarded 2,279 public-sector building and construction contracts worth 24.163 trillion Iraqi dinars ($18.45B) in 2025, with Baghdad accounting for the largest share of projects, the Commission of Statistics and GIS reported on Monday. Baghdad led all provinces with 416 contracts valued at 4.753 trillion dinars ($3.63B), representing 18.2% of all public construction contracts awarded during the year.
Diyala ranked second with 248 contracts worth 557 billion dinars ($425M), followed by Nineveh with 231 contracts valued at 1.203 trillion dinars ($918M).
The data also showed that provincial administrations oversaw the largest share of public building and construction projects in 2025, managing 1,406 projects. The Ministry of Construction, Housing and Public Municipalities ranked second, overseeing 216 projects.
Earlier this month, the Commission revealed that private-sector building and renovation permits in Iraq fell to 25,934 in 2025, an 11.4% decline from the 29,729 permits issued the previous year.
https://www.shafaq.com/en/Economy/18B-spent-on-2025-Iraqi-public-construction
Industry Revival Key To Diversifying Iraq’s Economy, Experts Say
2026-07-20 06:40 Shafaq News- Baghdad Iraq’s efforts to revive its industrial sector will determine whether the country can reduce its dependence on oil revenues and build a more productive economy, industry officials and economic analysts interviewed by Shafaq News suggested, calling for greater focus on restarting factories, supporting local production and attracting investment.
Despite its large natural resource base, consumer market and strategic location linking the Gulf with Turkiye and Europe, Iraq’s industrial sector remains limited after decades of conflict, sanctions, weak investment and inconsistent policies. Thousands of factories have stopped operating, while manufacturing continues to account for only a small share of an economy dominated by oil.
With crude revenues accounting for nearly 90% of government income, rebuilding industry has become a major challenge for Iraq as it seeks to create jobs, reduce imports and strengthen economic stability.
Aqeel al-Sayegh, deputy head of the Iraqi Industrialists Union, noted that some factories have begun returning to production, while new facilities have also started operations in recent years.
Al-Sayegh pointed to measures aimed at protecting local manufacturers, including customs restrictions on imported goods that compete with Iraqi products.
"We introduced protection measures for Iraqi products that have imported alternatives and imposed tariffs of 100% on cardboard, 65% on carpets, as well as measures covering juices, cakes, dairy products, disposable goods, PVC (rigid plastic used in pipes and windows), iron and other products," he explained.
He added that Iraq’s industrial exports now include construction materials, iron products and metal containers used in food and beverage industries, but maintained that more support is needed to help local producers compete.
"We have brought thousands of factories back into operation. The number of operating factories has reached around 37,000, while nearly 35,000 factories remain inactive," al-Sayegh remarked.
Many of those inactive facilities could return to production if they receive stronger government backing, he added, criticizing the ‘’gap between official commitments and actual implementation.’’
Beyond efforts to reopen factories, Iraq’s industrial recovery depends on addressing deeper structural challenges, including the shortage of locally available raw materials and limited industrial supply chains.
Al-Sayegh identified petrochemicals as one of the sectors with the greatest potential, arguing that Iraq’s continued burning of associated gas represents a missed opportunity to develop industries based on locally available resources.
"The gas that is being burned today could produce real wealth through petrochemicals and plastic pellets, while oil can also be used to produce materials that enter industries such as detergents and cosmetics," he stated.
Nawar al-Saadi, a professor of international economics, noted that Iraq needs to rethink the role of imports rather than simply attempt to reduce them.
Al-Saadi maintained that imports should support domestic production by providing machinery, technology and industrial materials instead of replacing locally made products.
"Imports should focus on providing raw materials, technology and equipment needed by Iraqi industries rather than flooding markets with products that can be manufactured locally," he explained.
Advocating for a national industrial strategy focused on sectors where Iraq has potential advantages, including food production, pharmaceuticals, petrochemicals and construction materials, he stressed that improving electricity supplies, simplifying administrative procedures, strengthening banking services and linking vocational training with industrial needs would also be necessary to create a more competitive business environment.
Read more: Iraq’s economic “perfect storm”: Experts warnthe crisis is structural and social
While industrial policy remains a central concern, other analysts believe the management of existing industrial assets will also play a key role in Iraq’s recovery.
Economic analyst Ahmed Adnan argued that restructuring inactive state-owned factories should be among Iraq’s priorities, with greater private-sector involvement helping transform those facilities into productive investments.
Calling for specialized industrial zones equipped with infrastructure and reliable energy supplies, he cited Iraq’s dependence on imports, which cover around 80% of domestic needs, as an opportunity for local manufacturers to expand production.
"If Iraq can produce these needs domestically, it will not only reduce imports but could also become an exporter to neighboring countries," he stated, referring to the importance of energy sector reform, agricultural development and stronger protections for investors as conditions needed to attract more domestic and foreign capital.
Beyond infrastructure and investment, some analysts believe that Iraq’s resource base itself offers untapped opportunities for industrial growth.
Mustafa al-Faraj, an economic analyst, viewed Iraq’s natural resources as a potential foundation for industrial expansion if they are transformed into finished products rather than remaining limited to extraction.
Al-Faraj cited resources such as silica sand, which could support several manufacturing sectors, calling for measures including incentives for factories, easier access to financing, specialized industrial zones and improved transport networks to lower production costs and strengthen exports.
"Natural resources should not remain limited to extraction," al-Faraj stated. "They should be transformed into industries that create jobs, generate exports and add greater value to the economy."
Read more: Can "Made in Iraq" rise again? Challenges and hopes for local manufacturing
https://www.shafaq.com/en/Economy/Industry-revival-key-to-diversifying-Iraq-s-economy-experts-say
CBI Cash Holdings Fall 70 Percent
2026-07-20 07:05 Shafaq News- Baghdad Cash held in the vaults of the Central Bank of Iraq (CBI) fell to 566 billion Iraqi dinars at the end of April 2026, down from 1.907 trillion dinars at the end of December 2025.
According to CBI data, the decline was continuous across the four-month period. Cash holdings at 1.524 trillion dinars at the end of January, 1.005 trillion dinars at the end of February, and 849 billion dinars at the end of March, before reaching the April figure.
The total drawdown amounted to about 1.341 trillion dinars over four months, a decrease of 70.3 percent against the level recorded at the close of 2025.
Measured against earlier years, the April figure remains above the 323 billion dinars registered at the end of 2023. It is 72.9 percent below the end-2024 level of 2.092 trillion dinars.
Over the same January to April period, the official exchange rate held steady at 1,300 dinars to the US dollar, according to the data. Inflation rose gradually across those months, from 0.9 percent in January to 1.7 percent at the end of April.
https://www.shafaq.com/en/Economy/CBI-cash-holdings-fall-70-percent
SOMO To Revive Iraq’s Gas Oil Purchases After 18 Months
2026-07-20 08:00 Shafaq News- Baghdad Iraq’s State Oil Marketing Organization (SOMO) is seeking to buy 127,500 tons (949,875 barrels) of gas oil for August and September delivery, its first such purchase since January 2025, according to a tender document reviewed by Reuters.
The state marketer requested gas oil containing 2,500 parts per million of sulfur, with the first 40,000-ton cargo to be loaded by August 1, returning Iraq to the gas oil purchase market after imports were halted in November 2025 upon declaring self-sufficiency in gas oil, gasoline, and kerosene.
SOMO figures showed Iraq imported no gas oil or kerosene during the first quarter of 2026, while gasoline imports fell 66.1% year on year.
Iraq had expanded domestic fuel production through the 140,000-barrel-per-day Karbala refinery and new refining units, allowing the government to reduce imports and direct surplus petroleum products toward exports.
The tender document did not state why SOMO had returned to the purchase market, but it was issued as renewed US-Iran tensions disrupted energy shipments through the Strait of Hormuz, the route connecting Iraq’s southern Gulf terminals to international markets.
Read more: Iraq's energy vulnerability: When a petro-state has no buffer
https://www.shafaq.com/en/Economy/SOMO-to-revive-Iraq-s-gas-oil-purchases-after-18-months
Gold Prices Slide In Baghdad And Erbil
2026-07-20 04:36 Shafaq News- Baghdad/ Erbil On Monday, gold prices fell in Baghdad and Erbil, hovering around 850,000 IQD per mithqal, according to Shafaq News market survey.
Gold prices on Baghdad's Al-Nahr Street recorded a selling price of 848,000 IQD per mithqal (equivalent to five grams) for 21-carat gold, including Gulf, Turkish, and European varieties, with a buying price of 844,000 IQD. The same gold had sold for 856,000 IQD on Sunday.
The selling price for 21-carat Iraqi gold stood at 818,000 IQD, with a buying price of 814,000 IQD.
In jewelry stores, 21-carat Gulf gold ranged between 850,000 and 860,000 IQD per mithqal, while Iraqi gold sold for between 820,000 and 830,000 IQD.
In Erbil, 22-carat gold was sold at 900,000 IQD per mithqal, 21-carat gold at 860,000 IQD, and 18-carat gold at 736,000 IQD.
https://www.shafaq.com/en/Economy/Gold-prices-slide-in-Baghdad-and-Erbil
Dollar Dips In Baghdad And Erbil
2026-07-20 04:12 Shafaq News- Baghdad/ Erbil The US dollar opened Monday's trading lower in Iraq, hovering around 151,000 dinars per 100 dollars in Baghdad and Erbil.
According to Shafaq News market survey, the dollar traded in Baghdad's Al-Kifah and Al-Harithiya exchanges at 150,800 dinars per 100 dollars, down from Sunday's 152,600 dinars.
In the Iraqi capital, exchange shops sold the dollar at 151,250 dinars and bought it at 150,250 dinars.
In Erbil, selling prices stood at 151,550 dinars and buying prices at 151,300 dinars.
https://www.shafaq.com/en/Economy/Dollar-dips-in-Baghdad-and-Erbil