Iraq's import concentration fuels major economic deficit

Shafaq News – Baghdad

Iraq’s imports remain heavily concentrated among a small number of countries, raising economic concerns, an expert told Shafaq News on Sunday.

Manar Al-Obaidi, head of the Future Iraq Institute for Economic Studies and Consultations, noted that the United Arab Emirates, China, and Turkiye dominate as Iraq’s main suppliers.

Just nine product categories out of 99 globally recognized groups account for more than 67% of Iraq’s total import value. Electronics and electrical equipment top the list, followed by precious metals—mainly gold—cars and automotive equipment, as well as mechanical devices, including cooling units.

Al-Obaidi outlined three major challenges arising from these trends. The first is the persistent trade deficit, as Iraq imports far more than it exports outside oil, leaving the balance heavily skewed toward exporting nations.

“This requires smarter trade policies focused on reciprocity and opening markets to Iraqi goods through incentives or more balanced agreements,” Al-Obaidi explained.

The second challenge involves the type of imported goods, with many falling into luxury or semi-luxury categories such as cars and electronics.

“The government could address this by limiting certain imports or requiring foreign companies to establish local production or assembly stages in Iraq,” he noted, adding that such steps could foster industrial knowledge transfer, create jobs, and strengthen domestic manufacturing over time.

The third challenge concerns food security. Iraq relies heavily on food imports from Turkiye, placing a critical part of its national security under the control of a single foreign source—a vulnerability comparable to water security concerns.

“Relying on one supplier for food carries strategic risks and could become a political lever,” he warned, stressing that Iraq must diversify its sources or develop a domestic food industry capable of meeting essential needs.

Addressing the urgency of these issues, Al-Obaidi concluded that tackling Iraq’s trade deficit, limited industrial knowledge transfer, and food security vulnerabilities requires actionable plans, including smarter import management, balanced partnerships, and investment in local production.