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A Sovereign Wealth Fund for Iraq
The past ten years have seen a rapid growth of SWFs in both size and quantity.
However, many of these SWFs only project success due to the sheer size of the assets that back them, such as hydrocarbons.
Although this grants them the ability to withstand economic crises and increase the economic profiles of their home-countries, a closer look at them shows that many SWFs fail in achieving their stated goals of diversifying their economies, building local capacities and, ultimately, averting issues such as the Resource Curse and the Dutch Disease.
The case studies of Norway and Qatar show that it is not an SWF that cures a country of such problems, it is institutionalisation, transparency, accountability and, ultimately, a clear mission and focus.
This paper has looked into the notion of whether Iraq can benefit from having its own SWF as it moves to post-war reconstruction of its infrastructure and the diversification of its economy away from over-reliance on hydrocarbons.
This paper concluded that Iraq can indeed benefit from an SWF, particularly one that prioritises development and capacity-building while protecting the Iraqi economy from its current vulnerabilities.
This paper reiterates the point that the creation of an SWF is not sufficient enough to move Iraq past its vulnerabilities.
Failure to recognise that will turn the fund from a solution to a problem.
Rather, the fund is a tool that can help protect Iraq’s economy, serve as a vehicle of reconstruction and redevelopment, diversification and even anti-corruption.