Iraq has been a battleground for competing forces since a US-led coalition invaded it in 2003 to oust former president Saddam Hussein. Since then, the mainly Shia-led governments have not succeeded to maintain order. The country is sadly still in turmoil, and extremely dangerous, so Western governments continue to advise against all but essential travel to many areas.
Iraq may have the world's second largest reserves of crude oil, but the chronic instability and sectarian violence have hindered efforts to rebuild its economy, which has been shattered by conflict and sanctions.
The Iraqi economy now faces severe challenges ' the ISIS insurgency, which has required a great deal of humanitarian relief and security expenditure, combined with the decline in oil prices in 2015 and 2016, have contributed to a sharp deterioration in economic activity.
The unstable situation has resulted in little private investment and a poor business environment, while the country's exposure to a volatile oil market also means that macroeconomic risks remain elevated. However, there is a more favourable medium-term outlook for the economy. The IMF has approved a three-year Stand-By Arrangement in July 2016 for USD 5.34 billion, and it launched a series of three Development Policy Financing programmes in which many foreign professionals are involved and which will hopefully give the economy the boost it needs.
A pressing issue is also the security situation, as casualty figures in Iraq remain high. Since 2014 alone, the humanitarian crisis has affected over ten million of its citizens (and over three million have been internally displaced), which means there is still a heavy reliance on expatriates in the aid and security sectors.
In July 2016, a donor conference pledged a total of USD 2.1 billion to secure financial support for Iraq's humanitarian crisis. A better security situation, as well as an initial reconstruction effort, are expected to sustain growth so that Iraq can one day be released from the shackles of its recent bloody history, and once again be appreciated for its vibrant cities, breathtaking mountains, and numerous archaeological sites.
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