MP: Economic Policies Driving Iraq 'to Brink of Collapse'
As if Iraq didn't have enough problems with ongoing sectarian violence, al-Qaida in Iraq and key parties in the government's tenuous coalition dropping out (just to name a few), now the country is getting bad economic news.
The Daily Star reports that Mehdi Hafedh, the former Iraqi planning and cooperation minister and a current member of parliament, warned at a conference Wednesday in Lebanon that current economic policies are "not viable and are pushing the country further toward the brink of total collapse." He also said that Iraq's "dependence on oil is not sustainable" and called for diversifying economic activity.
Hafedh said too many obstacles stand in the way of the private sector in Iraq, including interest rates that run higher than 23 percent. The Iraqi MP says this means businesses need to make a return of more than 30 percent to have a chance at making a profit.
But Safa Saber al-Helou, a member of the Union of Iraq Businessmen, told The Daily Star that there are areas of the country where investing makes sense: "Although many Lebanese might not be aware, the fact is that north Iraq is almost 100 percent safe, and the south is around 85 percent safe. Investments in these areas are not risky. The danger is mostly in the center of Iraq and the capital."
11:38 AM ET | 08- 2-2007 | permalink
