History of Iraq That Affected the Dinar Value
The country of Iraq has seen a fair share of war in recent decades. A lot of lives have been lost and structures were damaged beyond repair. A lot of people know Iraq as a war-torn country which has been taking the place of headlines for many years. But before the two Gulf Wars involved the country, what was it like living in peaceful Iraq?
The Life in Iraq Before the War
Before Iran was known as the war-torn country, it was known as a modernizing country. The city of Baghdad was filled with infrastructures that housed thriving businesses, as well as the best of Iraq’s old traditions. Pools were becoming popular in the city and females are encouraged to go to school. The port city of Basra was even called the Middle Eastern Venice. The Iraqi Dinar was valued at 1 IQD – $3.2169 which remained until the emergence of the Gulf War.
Saddam Hussein And His War
When Saddam Hussein assumed the presidency in 1979, no one was expecting what would happen to Iran a few years later. Before the 1980s, Iraq’s economy was at its peak, the Iraqi Dinar was strong, and the country was one of the fastest growing countries in the world. However, it all changed when Saddam Hussein started what will be known today as the Iran-Iraq War.
War can affect a lot of things in a country, especially the economy. During Iraq’s war with Iran, the Iraqi dinar and the country’s GDP plummeted. The infrastructures which were built during the peaceful times were destroyed. A lot of soldiers and civilians lost their lives. Ultimately, Iraq won the war in 1988 and managed to get sovereignty over the Shatt-el-Arab River, which combines the Tigris and Euphrates.
However, the problem will did not end with Iran’s cease-fire and UN Resolution 598. The Gulf War, which is codenamed as the Operation Desert Shield, started in 1990. It was then followed by the 2003 Iraq War which planned to overthrow the government of Saddam Hussein in breach of international law. Ultimately, Saddam Hussein was arrested in December of 2003. He then underwent trials for his crimes and was sentenced to death after a long trial in 2006. A large amount of money which Hussein and his family reportedly deposited on offshore accounts were being recovered too.
During the recent time, Iraq once again suffered from the cost of war because of the ISIS threat. The never-ending involvement of Iraq in wars and battles never let its economy breathe for a while and repair itself. In addition to this, there are sanctions which are imposed on the country which disabled it to use the big deposit of oil in its land.
Sanctions Against Iraq
After the Iran-Iraq war, the UN Security Council imposed a sanction against Iraq as a leverage for the Iraqi disarmament. Instead of selling their oil to fund their expenditures, Iraqis were forced to exchange oil for food. Because of this, the government revenue which was supposed to help in raising the Iraq economy was used for food instead. The sanctions were lifted after Hussein was ousted in 2003. Iraq finally recovered the full authority over their sales in the oil industry.
Things are getting bright once again for Iraq after the lift of UN sanctions. However, with the ISIS threat, as well as the government mismanagement and corruption that are affecting the economy of Iraq, the country still suffered hardships even after the sanction lift. Because of these chain of events, Iraq’s economy remained low.
Iraq’s Turning Point: The Price of Iraqi Dinar
Barham Salih became the new president of Iraq last year, which made a huge change in the overall political structure of the country. Salih’s leadership is expected to keep the peace in the country as well as spearhead the program to rebuild the Iraqi economy. It is still plagued by the residual effects of Saddam Hussein’s wars, as well as the current threat of ISIS.
Iraq’s recovery has been overdue with its people now focused on rebuilding their country. Developments such as coming up with a stable and solid monetary policy, and investing in its oil and its human resources, is targeted by the Central Bank of Iraq. As development continues, the economy will surely rise, as well as the price of the Iraqi dinar.