Iraq is building apartment towers and new shopping malls, upgrading airports and ports, planning new roads, modernizing its agriculture, and striving to strengthen trade ties with other countries. There is strong market demand for Western consumer goods. Since taking office in late 2022, Prime Minister Mohammed Shiaa al-Sudani has been actively involved in a wide range of affairs, repeatedly emphasizing that Iraq is ready to do business. Trade and investment were major topics during his official visit in April 2024.

According to the Iraqi constitution, the Kurdistan Region enjoys semi-autonomous rights and is often considered the preferred starting point for foreign companies entering the Iraqi market. One key advantage of the Kurdistan Region is that it allows 100% foreign ownership of businesses, whereas in federal Iraq, foreign ownership is capped at 49%. Iraq’s main trading partners include neighboring Turkiye and Iran, as well as countries such as China.

Iraq’s economy is directed by the government—a structure rooted in decades of communist and autocratic decision-making—and to this day remains characterized by bloated ministries that control about three-quarters of economic activity. Oil exports form the core of Iraq’s GDP. According to IMF data, Iraq’s GDP grew by 7% in 2022, contracted by 2% in 2023, and is expected to grow moderately in 2024. Headline inflation was 4.4% in 2022 and 4.0% in 2023. Much of the non-state, non-oil economy remains informal, cash-based, and vibrant.

Some militias originally mobilized to fight extremist groups remain active. They are nominally under government control but in reality are influenced by Iran. From October 2023 to February 2024, multiple attacks were carried out on foreign facilities. However, this violence did not specifically target regular foreign businesses. Militia groups have been implicated in crimes such as extortion, destruction of communications infrastructure, and bombings of energy infrastructure.

Before signing cooperation agreements, companies should conduct thorough due diligence on Iraqi partners. Iraq is a society that values honor and personal relationships, but its court system is relatively weak in handling commercial disputes. In 2024, Iraq signed the United Nations Singapore Convention on Mediation—an important step toward improving commercial dispute resolution. If a project is funded by the federal government budget, companies may face long payment delays, especially when dealing with government entities. Common operational challenges for both foreign and local firms include corruption, registration procedures, customs, taxation, uneven regulatory enforcement, dispute resolution, electricity shortages, and difficulty obtaining financing.

Despite these challenges, the Iraqi market still holds appeal. Iraq consistently imports agricultural products, machinery, consumer goods, transport equipment, and industrial materials. Government procurement and public tenders remain the main sources of business opportunities.

Two large tenders are expected at the end of 2024: one for rehabilitating Baghdad International Airport, and another for constructing a north-south railway and highway corridor known as the “Development Road.” If the oil revenue dispute between the federal government and the Kurdistan Region is resolved, it could further encourage investment in the oil and gas sector in the Kurdistan Region.

Although investors in the Kurdistan Region face many of the same challenges found elsewhere in Iraq, the region’s relatively friendly investment climate—such as allowing full foreign ownership—and its more commercially-oriented legal framework make it attractive to foreign companies. However, issues remain, including disputes with the central government over oil revenues and the Iraq-Turkiye pipeline, tensions between the region’s main political factions, an economy dominated by powerful families, widespread delays or non-payment to foreign companies under government contracts, and reduced consumer spending when government salaries are delayed. Iran and Iran-aligned militia groups have carried out dozens of missile and drone attacks in the region, including deadly strikes in Erbil and the Khor Mor gas field in January and April 2024. Turkiye also regularly conducts airstrikes on alleged terrorist targets in the Kurdistan Region, though these activities rarely affect international companies.

Fore more information, please refer to at https://2021-2025.state.gov/reports/2024-investment-climate-statements/iraq/

March 31，Despite some development in Iraqi bank payment cards and electronic payment systems in recent years, cash remains the dominant form of payment, with approximately 90% to 95% of transactions still completed in cash. The main reasons include a lack of public trust in the banking system, concerns about the security and stability of digital payments, insufficient financial literacy, and the fact that a large amount of economic activity remains informal. Data shows that 40% to 45% of currency still circulates outside the banking system.

March 25，According to Director General Awad Kazem Abdul Amir, the Basra Cement Plant recorded output of 41,123 tones, reflecting improved resource management and operational readiness. The plant's production complies with Iraqi Standard No. 5 of 2019, as well as international standards for quality, environment, and occupational health and safety.

March 24，The State Company for Rubber Industries and Tires, one of the companies of the Ministry of Industry and Minerals, has signed a partnership contract with the private sector to establish an integrated industrial project for specialized rubber products.

March 12，Iraq ranked first among destinations for Jordanian exports worth 103 million dinars ($145 million) in the first two months of 2026, the Amman Chamber of Commerce said on Thursday. The Chamber reported that exports reached 273 million dinars in January and February, up from 226 million dinars in the same period last year, a 20.6% increase.

March 11，Iraq’s Ministry of Communications imposed an additional 20% service fee on internet services provided to citizens through fiber-to-the-home (FTTH) networks and Wi-Fi services, according to a document on Tuesday.

February 23, Iraq Mall, the nation's latest and biggest shopping center, opened its doors to the public in Baghdad. The mall, which is more than 550,000 square meters in size and is marketed as the biggest in Iraq and the third largest in the Middle East, is anticipated to attract millions of tourists each year.

February 22, The chairman of Iraq's National Investment Commission (NIC) revealed that investments worth $65 billion will be pumped into the al-Tayeb border city to transform it into an economic hub. In a statement to the Iraqi News Agency (INA), Makiya explained that al-Tayeb is a diversified economic city with an area of about 120,000 acres.

February 17, Iraq’s Ministry of Industry and Minerals revealed that the General Company for Automotive and Equipment Industry has entered into a partnership with Iraqi and UAE companies to set up a fully integrated automobile assembly infrastructure. The initiative will help the country produce and sell buses, small trucks, passenger vehicles, large trucks, and specialized machinery. 

February 10, Iraq's tourism authority announced the development of a strategy, in cooperation with the German Agency for International Cooperation (GIZ), to attract 10 million foreign tourists. The spokesperson for the tourism authority told the state-run news agency (INA) that the national tourism strategy, which had been scheduled for 2035, has now been extended until 2045.

February 8, S&P Global confirmed Iraq’s long-term and short-term foreign and local currency sovereign credit ratings. The steady projection is based on the corporation’s forecast that Iraq’s foreign reserves would continue to comfortably surpass its external public sector debt.

January 21, Iraq's National Investment Commission stated 2025 was a landmark year for the country’s economy, having processed over 850 investment applications across key sectors and hit a total investment volume of over $102 billion in three years. The NIC focused on energy, infrastructure, housing, environmental innovation and other core fields in 2025. 

January 20, Iraq is increasingly positioning itself as an attractive destination for global energy investment, driven by improved security, political stability, and a strategic push toward renewable energy, according to the National Team for Renewable Energy Projects.      

January 09, Iraq's General Customs Administration has announced the implementation of a pre-clearance declaration system for all goods and commodities starting from January 1, 2026. Traders or importers must first declare their goods through the pre-declaration system before completing fund transfers.

January 8, As Iraq steps into 2026, its government has rolled out a tough new customs tariff policy to boost non-oil revenues, stirring widespread worries among citizens and traders. Hybrid and electric cars, once tax-exempt for environmental incentives, now face a 15% tariff, while medicine and medical supply customs have surged tenfold from 0.5% to 5%.

January 6, Director of international relations at the Iraqi Ministry of Culture revealed that a national strategy to promote the tourism sector and attract ten million tourists by 2035 is being developed. The strategies include restoring tourist attractions, expanding human resource capacity, promoting ecological, historical, and archeological tourism, and enhancing tourism’s contribution to the national economy.

December 21, The Central Bank of Iraq (CBI) revealed that the country’s imports during the first nine months of 2025 surpassed $63 billion. The country’s imports include machinery, transport equipment, manufactured goods, fuels, lubricants, chemicals, and foodstuffs.

December 18, BYD has formally entered the Iraqi automotive market, despite having several models already available there. The Chinese new energy vehicle maker held a brand launch event in Baghdad, Iraq's capital, on December 24 to announce its official entry into the country, according to an announcement today.

December 17, The Central Bank of Iraq (CBI) cautioned that the country’s foreign currency reserves are under increasing strain due to low oil prices and a depleting monetary policy. In an official appraisal, the CBI stated that Iraq’s reserves are still linked to oil income, making them sensitive to global crude price changes. 

December 15, Iraqi Foreign Minister Fuad Hussein disclosed that the volume of trade exchange between Iraq and China is roughly $54 billion, with Beijing being the largest market for Iraqi oil. Chinese companies have been heavily involved in the oil industry and in significant infrastructure projects, such as the construction of major bridges and schools, with more than 600 schools completed in various Iraqi provinces. 

December 3, Iraq announced that it plans to invest $184 billion in key sectors, including oil and manufacturing industries, to achieve a four percent economic growth amid significant political challenges, including the formation of a new government. 

November 28, Iraq has attracted a total of 102 billion US dollars in investment over the past three years, including 69 billion US dollars in foreign investment and 33 billion US dollars in local investment, with these funds flowing into key sectors such as energy, renewable energy, housing and industry — a statement made by Dr. Haider Muhammad Makia, Chairman of Iraq's National Investment Commission (NIC).

November 27, The Central Bank of Iraq (CBI) revealed that the country’s imports during the first half of 2025 surpassed $40 billion. The country’s imports include machinery, transport equipment, manufactured goods, fuels, lubricants, chemicals, and foodstuffs. Iraq’s key commercial partners are the United States, China, Syria, India, and South Korea.

November 26, Fitch Ratings affirmed Iraq’s sovereign rating at B- with a stable outlook, underlining the country’s dependence on commodity income and the slow pace of economic development. The US credit rating agency said in a statement that the continued challenges of the government formation process are projected to delay the approval of the 2026 budget, thereby increasing fiscal uncertainty and slowing the pace of economic reforms.

October 23, The World Bank said Morocco boasts resources that position the country as a regional trade and financial hub for the African continent. The bank also described the North African country as a preferred destination or location for global events, describing this as a “pivotal opportunity to accelerate capital market development.”

October 1, Moroccan households believe their living standards have worsened over the past year, a new report from the High Commission for Planning (HCP) says. According to the HCP’s National Household Conditions Survey, 77.9% of families said their standard of living has deteriorated during the last 12 months, while only 5% believe it has improved.    

October 16, Morocco’s economy is set to gain momentum in the coming years, with real GDP projected to reach 4.4% in 2025, up from 3.8% in 2024, according to the International Monetary Fund’s (IMF) latest Global Economic Outlook.

October 10, Moroccan cities are climbing the ranks in Africa’s rental market, with three urban centers now featured among the continent’s 20 priciest cities for housing, according to the latest data from international cost-of-living platform Numbeo. Casablanca leads the pack, securing the 5th position in Africa and ranking 271st globally out of 391 cities analyzed.

September 20, Iraq is set to open its first industrial-scale solar plant in a vast desert area in Karbala as the government attempts to tackle an electricity crisis that has led to widespread blackouts. Authorities said the plant, the largest of its kind in Iraq, will be inaugurated to eventually produce up to 300 megawatts of electricity at its peak. 

September 10, The Iraqi government decided to impose a 30% additional tariff on white plates and containers made of polystyrene pellets (used for food preservation) imported from all countries and regions.

September 4, The Iraqi Ministry of Trade confirmed agreements with companies from Germany, China, and Brazil to open car production lines in Iraq. The ministry noted that the cars produced will run on natural gas and will be available on installments. The project represents a step towards the 'Made in Iraq' slogan and aims to employ local workers and provide economical and environmentally friendly cars."

September 4, The Ministry of Trade of Iraq requires that products exported to Iraq must be accompanied by a certificate of origin printed with a QR code, which should contain all the product information. This decision will take effect on August 10, 2025.

September 3, The counselor of the Chinese Embassy in Iraq revealed that the volume of trade exchange reached approximately $200 billion in 2024. He stated that Chinese companies have been operating in the energy sector in Iraq for many years, especially after 2003, and have contributed to the reconstruction of the oil sector and the export of crude oil to foreign markets.

August 24, Iraq’s National Investment Commission revealed that it developed a plan to attract new investments worth $250 billion over the next two years. The spokesperson said that the Iraqi government’s supporting investment policies, as well as legislative and regulatory reforms, have resulted in Arab and international investments totaling over $100 billion in different sectors in the past two years.

August 21, Iraq has been named one of China’s top 20 trading partners for 2024, with a total trade volume reaching approximately $54.2 billion, according to a recent report from S&P Global. The two nations accounts for 20.5% of Iraq’s Gross Domestic Product (GDP).

August 10, The report of the Iraqi Foundation for Future Economic Research and Consultancy states that in the first half of this year, the number of cars directly exported from China to Iraq increased to 18,000, compared with 10,500 in the first half of 2024, representing a 71.4% increase.  

August 10, Iraq has emerged as the third-largest Arab importer of solar panels from China during the first half of 2025. This ranking is attributed to the launch of numerous new solar energy projects across the country.

August 7, Iraq has released a new five-year development plan aimed at lowering unemployment and increasing diversification to enhance economic growth. The spokesperson for the Iraqi Planning Ministry stated that the 2024-2028 plan intends to reduce unemployment to 10% from the present 13%, with an annual economic growth rate of 4.24%.

July 26, The Iraqi car market is witnessing a dramatic shift, with Chinese vehicle sales soaring by an impressive 80% in the first half of 2025 compared to the same period last year. Over 18,000 cars from China have been imported into the country during this period, significantly up from approximately 10,000 units sold in the first half of 2024.

July 24, China’s direct exports to Iraq witnessed a notable increase in the first half of 2025, growing by 9.3% compared to the same period in 2024, and by 13.2% from the second half of 2024. Machinery and electrical equipment led the exported goods, accounting for 23% of total exports with a value of $2.1 billion. 

July 23, Deputy Oil Minister said that the ministry continues to increase solar energy projects to reach a production capacity of 12,000 megawatts by 2030. Iraq’s electricity shortage, one of the main issues facing the current government, may be strategically resolved with solar energy. 

July 19, A surge in public spending due to high wages to public servants has made Iraq's economy more vulnerable, the International Monetary Fund said. The economy of Opec’s second largest oil producer is facing considerable headwinds, with the non-oil sector growth slowing from 13.8% in 2023 to an estimated 2.5% in 2024.