Iraq has been blessed with abundant economic and human resources. It has the second highest proven oil reserves in the world at around 112 billion barrels, after Saudi Arabia with 262 billion barrels. However, despite its wealth, Iraq has experienced continuous economic deterioration since 1980 and has become one of the region's least developed economies. A country that could have been a model of development for the Arab world turned out to be a devastated case of economic decline, mismanagement and massive corruption. For many in the Bush Administration Iraq is now the test case for whether the United States can create, within the Arab world, a system of American style free market capitalism. In a February address, President Bush spoke of "a new Arab charter that champions internal reform, greater political participation, economic openness and free trade." A new regime in Iraq, he said, "would serve as a dramatic and inspiring example of freedom for other nations in the region". This Strategic Insight examines the neoliberal model's approach to restructuring Iraq's economy. What are the model's main assumptions and components? How would it be applied to the Iraqi economy? Are the conditions in Iraq such that it has a good chance of success?
Naval Postgraduate School, Center for Contemporary Conflict: http://www.ccc.nps.navy.mil
Strategic Insights (August 2003), v.2 no.8