Iraq needs ‘cultural change’ to strengthen economy: Foreign Minister
ERBIL, Kurdistan Region - Iraq’s economic woes and endemic unemployment will only be addressed once the population undergoes major changes in its “culture and mentality,” the Iraqi foreign minister said Monday, with a lackluster private sector failing to sway youth from embarking on a career path in government service.
Young Iraqis largely view public sector jobs as a safe haven against economic instability that typically sends the country’s private sector into a rollercoaster of boom and drought, as oil production, which accounts for 90 percent of national revenues, continues to place heavy demand on jobs in the public sector.
“The unemployment is huge among Iraqis. The majority of Iraq’s population are young, and each year we receive thousands and thousands of Iraqis who graduate from universities and are asking us for jobs, and the culture and mentality in Iraq is still: finding jobs in the public sector is better than to search for jobs in other sectors,” Foreign Minister Fuad Hussein said in a discussion at the Wilson Center, a Washington-based think-tank.
“But the reality is also there, the private sector is still very weak, so to build another economy and to change this structure, which depends heavily on public sector, is not so easy,” Hussein added, urging the need to establish a “decentralization and federal” system in Iraq which he says he has strongly fought for.
The state is by far the biggest employer in Iraq, a country with an estimated population of 42 million people of which four out of 10 young people are unemployed.
Hussein further defended his calls for decentralization by explaining that the Iraqi constitution is incompatible with a centralist culture.
“Our constitution is a liberal constitution … but many articles in the constitution, I can say about 50, have not been translated into law, and even if they are translated into law, we need to change the culture. The culture of centralism cannot fit with the constitution,” he said while describing Iraq’s overwhelming reliance on oil as a key deterrent for the change into a decentralized system.
Iraqi Prime Minister Mohammed Shia’ al-Sudani has repeatedly labeled the development of the country’s private sector as one of his key missions since taking office, saying that Iraq’s economic situation cannot be corrected unless the private sector plays an essential role in its recovery.
“How is it possible to have a private sector and to have a liberal economy, a market economy, while the main pillar of the economy is in the hands of the government?” Hussein stressed but again reiterated the weakness of the private sector as a key factor perpetually edging Iraq’s youth towards the public sector.
Maha Kattaa, Iraq country coordinator for the International Labour Organization, told AFP in October that Iraq’s brightest young talents often snub the private sector and opt for an unproductive easy ride in government service.
“Graduates, if they start working in the private sector, consider it a temporary job until they can find an opportunity in the public sector,” she said.
The International Monetary Fund (IMF) in December said Iraq’s GDP was projected to grow by 8 percent in 2022 amid soaring oil prices and advised the country to take advantage of the increase in prices to boost its economy.
However, the fund warned Iraq against its massive dependence on the resource, stressing that a drop in oil prices has the potential to jeopardize the country’s gains.
As high oil revenues continue to lure young Iraqi graduates toward government jobs, no concrete actions have yet been taken to strengthen the private sector.
In January, Iraq pocketed over seven billion dollars from oil sales, continuing the trend of high profits as the country collected over $115 billion from exporting the resource in 2022.
Young Iraqis largely view public sector jobs as a safe haven against economic instability that typically sends the country’s private sector into a rollercoaster of boom and drought, as oil production, which accounts for 90 percent of national revenues, continues to place heavy demand on jobs in the public sector.
“The unemployment is huge among Iraqis. The majority of Iraq’s population are young, and each year we receive thousands and thousands of Iraqis who graduate from universities and are asking us for jobs, and the culture and mentality in Iraq is still: finding jobs in the public sector is better than to search for jobs in other sectors,” Foreign Minister Fuad Hussein said in a discussion at the Wilson Center, a Washington-based think-tank.
“But the reality is also there, the private sector is still very weak, so to build another economy and to change this structure, which depends heavily on public sector, is not so easy,” Hussein added, urging the need to establish a “decentralization and federal” system in Iraq which he says he has strongly fought for.
The state is by far the biggest employer in Iraq, a country with an estimated population of 42 million people of which four out of 10 young people are unemployed.
Hussein further defended his calls for decentralization by explaining that the Iraqi constitution is incompatible with a centralist culture.
“Our constitution is a liberal constitution … but many articles in the constitution, I can say about 50, have not been translated into law, and even if they are translated into law, we need to change the culture. The culture of centralism cannot fit with the constitution,” he said while describing Iraq’s overwhelming reliance on oil as a key deterrent for the change into a decentralized system.
Iraqi Prime Minister Mohammed Shia’ al-Sudani has repeatedly labeled the development of the country’s private sector as one of his key missions since taking office, saying that Iraq’s economic situation cannot be corrected unless the private sector plays an essential role in its recovery.
“How is it possible to have a private sector and to have a liberal economy, a market economy, while the main pillar of the economy is in the hands of the government?” Hussein stressed but again reiterated the weakness of the private sector as a key factor perpetually edging Iraq’s youth towards the public sector.
Maha Kattaa, Iraq country coordinator for the International Labour Organization, told AFP in October that Iraq’s brightest young talents often snub the private sector and opt for an unproductive easy ride in government service.
“Graduates, if they start working in the private sector, consider it a temporary job until they can find an opportunity in the public sector,” she said.
The International Monetary Fund (IMF) in December said Iraq’s GDP was projected to grow by 8 percent in 2022 amid soaring oil prices and advised the country to take advantage of the increase in prices to boost its economy.
However, the fund warned Iraq against its massive dependence on the resource, stressing that a drop in oil prices has the potential to jeopardize the country’s gains.
As high oil revenues continue to lure young Iraqi graduates toward government jobs, no concrete actions have yet been taken to strengthen the private sector.
In January, Iraq pocketed over seven billion dollars from oil sales, continuing the trend of high profits as the country collected over $115 billion from exporting the resource in 2022.