From the Iraq Britain Business Council (IBBC):
You could be forgiven for thinking that Iraq is only dependant on oil and is a country struggling with conflict. However, reality has moved on from old perceptions and scarcely reflect the recent changes and dynamics that are tangible and progressing well. With a stable economic and political stability, Iraq is back and modernising. Indeed, in the context of the current middle east scenarios, Iraq has been relatively unscathed, muted, and mature in its handling of tensions.
Iraq’s financial and investment landscape is remodelling as reforms are starting to show measurable results across a range of sectors and an economy diversifying at pace. IBBC’s members have likewise reflected the sectoral diversification, including streaming platforms, event companies, design consultancy capabilities, maritime industries, tourism, recruitment and increasing applications of AI to manage production installations.
For a taster of what has been happening under the noses of the world’s media let’s see whats been happening across various sectors:
Non-oil GDP has grown at an average rate of about 4% between 2021 and 2023, signalling diversification after years of volatility. Foreign direct investment inflows reached a new record of $24bn in 2025 up from $2.6 billion in 2020, reflecting opportunities and investor confidence.
The Banking sector is modernization: electronic payment usage increased by more than 120% between 2021 and 2023, driven by greater adoption of POS systems and digital wallets. The CBI launched the National Financial Inclusion Strategy (2025-2029) to expand digital banking and microfinance supporting the private sector and restructuring major state-owned banks. These shifts are changing how regional and global markets view Iraq’s financial stability.
Oil is important as Iraq plans to double oil production but also diversify its energy mix, to 8mb/d by 2027, expand energy infrastructure, including nuclear, gas, and solar projects, with significant investments totalling USUSD 620bn by 2030. Key initiatives involve increasing power capacity to 44GW by 2025, developing 11GW of nuclear energy, and enhancing regional electricity interconnections, corresponding to 33% of the power capacity mix thanks to a sharp increase in solar capacity (5.3% in 2024). including a $500 million waste-to-energy plant in Baghdad and the distribution of loans via the Central Bank of Iraq for residential solar panel installations. Shell has returned to Iraq to convert gas to electricity and gas as a form of power is increasingly important. The 2024-2028 plan intends to reduce the oil sector’s contribution to GDP by up to 25% and bring unemployment down to 10%.
Across the broader economy, reconstruction and diversification efforts are reshaping both domestic and international perceptions. Iraq recorded a GDP of roughly $267 billion in 2023, making it one of the largest economies in the region.
Government spending on education rose to 9% of total public expenditures, supporting workforce development. Enrolment in Iraqi universities has grown by 30% since 2018, reflecting increasing emphasis on skills needed for a diversified economy. Combined with infrastructure projects these activities are shifting Iraq towards modernization and long-term economic planning.
Technology and agriculture are showing data-backed evidence of transformation. Iraq’s ICT market grew by an estimated 14% in 2023, supported by expanded fibre-optic coverage and rising demand for digital services. Investment is being directed into agriculture (agritech), manufacturing, and the technology/media sectors, as the government prioritises climate-smart agriculture to combat water scarcity and have secured investments for three new industrial cities to stimulate local manufacturing. In agriculture, wheat production reached over 6 million tons in 2023, one of the highest outputs in Iraq’s history, due to improved irrigation and government procurement programs.
E-government adoption has accelerated, as over 1.5 million citizens are using new online government platforms since 2022.
A $17 billion transport corridor of highways and railways are set to link the Grand Faw Port in Basra to the Turkish border, positioning Iraq as a regional trade hub between Asia and Europe. IBBC’s own members are part of the push to develop the Maritime industry in Basra with an academy and investment into ship building.
IBBC’s members reflect the dynamics of change, with initiatives in the Maritime economy, Tech, education and renewable power and finance. Iraq is back and its modernising. Now is the time to engage in one of opportunity economies in the region, early adopters will benefit from market entry as reality is ahead of perception
At IBBCs Mansion House conference on 9th June we are focusing on these changes with the people making the changes, and the opportunities the evolving Iraqi economy offers investors and citizens alike.
