World Congress for Middle Eastern Studies

Barcelona, July 19th - 24th 2010


Issues of the Reconstruction and Development in Iraq (005) - NOT_DEFINED activity_field_Panel

· NOT_DEFINED date: MON 19, 2.30-4.30 pm

· NOT_DEFINED institution: University of Erlangen-Nuremberg and Center for Iraq Studies - CIS (Germany)

· NOT_DEFINED organizer: Dr. Heiko Schuss and Benan Grams

· NOT_DEFINED language: English

· NOT_DEFINED description: The economy of Iraq has been severely weakened as a consequence of war and international economic sanctions. This has exhausted the country’s budget and deteriorated its economic and social situation. The change of the political situation after the end of Saddam Husain’s regime has directly affected the economic activities in Iraq; many opportunities, however, also many challenges have risen. Currently, Iraq is in the phase of rebuilding its institutions and infrastructure in several areas, politically, economically and socially. The international community, in supportive efforts to assist Iraq in its transition process, is offering several aid programs. In the light of these circumstances, joint-research activities of German and Iraqi economists have tackled some of the most important issues concerning the economic and the academic situation in Iraq. Four topics will be presented during the panel at the World Congress of Middle Eastern Studies and will be jointly held by Iraqi and German scientists.

Chair: Prof. Dr. Sefik Alp Bahadir and Dr. Heiko Schuss, University of Erlangen-Nuremberg and Center for Iraq Studies (CIS)

Discussant: Prof. Dr. Bernhard Prosch and Jun. Prof. Dr. Anja Zorob, University of Erlangen-Nuremberg, Free University of Berlin and Center for Middle Eastern and North African Politics

Paper presenter: Assist. Prof. Dr. Hanaa Hammood, (University of Erlangen-Nuremberg/ Center for Iraq Studies (CIS), Al-Mustansiriya University),
‘The Applicability of International Human Development Indicators to a Country in Conflict (the Case of Iraq)’
The Iraqi National Reports of Human Development 1995, 2002, and 2007 are the product of the joint efforts from the Ministry of Planning, experts from universities and NGOs with the cooperation and support of UNDP. The Gender Development Index (GDI) adjusts average achievements of the Human Development Index (HDI) to reflect inequalities between men and women in 3 dimensions: life expectancy at birth, education and income. By focusing on women opportunities rather than their abilities, Gender Empowerment Measure (GEM) highlights gender inequality in 3 key areas: political participation, economic participation, and earned income. Globally, when HDI is supplemented by GDI the overall HDI declines even in the highest ranking countries. Almost all over the world the GEM, like GDI, has a lower value than HDI except in Iraq, where it is higher. This study aims to show that GEM does not reflect the real situation of Iraqi women. Besides, the indicators used in calculating these indexes cannot capture the specific challenges under Iraqi conditions of conflict.

Paper presenters: Prof. Dr. Sefik Alp Bahadir, Mahmood M. Ali Barzani, M.Sc. (University of Erlangen-Nuremberg/ Center for Iraq Studies (CIS), Salahaddin University), ‘FDI Promotion Policies in the Iraqi Kurdistan Region - a Critical Appraisal’
In a bid to increase the foreign direct investment (FDI) in the Iraqi Kurdistan Region, the Regional Government enacted 2006 an Investment Law with highly liberal norms for foreign investors. Much of the FDI in recent years, however, has been concentrated in the general construction, tourism, and services sectors. Attempts of the Regional Government to enhance the FDI inflow in other sectors had not much effect so far. This paper examines the recent FDI promotion policies vis-à-vis to the main impediments for foreign investors in the Iraqi Kurdistan Region.

Paper presenters: Haider Aref, M.Sc., Prof. Jürgen Kähler, Ph.D., (University of Erlangen-Nuremberg/ Center for Iraq Studies (CIS), Baghdad University), ‘How Efficient is the Iraqi Stock Exchange?’
A well-developed stock market is widely regarded as a sign of, if not as a precondition for, the efficient allocation of savings and investments. Often an economic take-off is accompanied by surging activity on the domestic stock market. However, the Iraqi Stock Exchange (ISX) only began to operate in June 2004. We will address two aspects in the development of the ISX. First, we will detail some important institutional aspects of the exchange. Those aspects include ownership, trading system, trading rules, volume of trading, market capitalization, and transparency. We will compare the ISX to well-established exchanges to see whether the ISX still has deficiencies in its institutional structure or rules and regulations. The second part of the paper is concerned with a quantitative analysis of stock-price movements. As experience with other nascent stock markets shows, price dynamics on these markets are quite different from those of mature markets. Short-term price volatility is typically very high and, because of a lack of liquidity, large orders have significant impacts on stock prices. By applying univariate time-series methods, we try to detect unusual price patterns. But we also examine the impact of political events on stock-price movements. The aim of this analysis is to answer the question whether the ISX is efficient in incorporating available and relevant information.

Paper presenters: Assist. Prof. Dr. Thaer Al-Rashed, Dr. Heiko Schuss, (University of Erlangen-Nuremberg/ Center for Iraq Studies (CIS), Baghdad University), ‘The Predicament of Small and Medium Enterprises in Iraq and Measures to Solve their Problems’
The Iraqi economy since 1968 was dominated by the state sector. In the end of the 1980th and under the international sanctions private enterprises were encouraged again, but their distorted development depended upon good clientelistic relations to politicians. The destructions of war, the following insecurity and the economic ‘shock therapy’ of opening up the Iraqi market totally to foreign competitors decimated the weak Iraqi private sector and hit especially hard small and medium enterprises which do not have the personal and capital resources to cope with these problems.As the development of a strong class of small and medium entrepreneurs would be a prerequisite of a functioning market economy and a building stone of a democratic society there is a number of initiatives launched by the US, the Iraqi government and NGOs to support the rebuilding of Iraqi SMEs through microfinance, training programs and incubation centers. Besides describing the serious problems of Iraqi SMEs this paper will present these initiatives to support the SMEs, analyze their strategies and evaluate their efforts.