Iraq flag

Iraq country brief

Overview

Modern Iraq was established as a British Protectorate in 1920 by the League of Nations, following the First World War and the collapse of the Ottoman Empire.  A monarchy was established in 1921, with Iraq gaining its independence in 1932.  In 1958, the monarchy was overthrown in a military coup d’état, and the Republic of Iraq was created.  It came under the control of the Ba'ath Party in 1968, with General Saddam Hussein gradually assuming control and formally acceding to the Presidency in 1979.  He ruled until the collapse of his regime, following US-led coalition military action launched in March 2003 over Iraq’s failure to cooperate in relation to suspected stockpiles of weapons of mass destruction in violation of UN Security Council Resolution 687. 

Iraq shares borders with Iran, Turkey, Kuwait, Saudi Arabia, Jordan and Syria.  It has a narrow section of coastline measuring 58 km on the northern Gulf.  Its capital is Baghdad.  It has a total area of 438,317 km² and a population of around 32 million.  There are 18 provinces in Iraq, including three provinces under the control of the Kurdish Regional Government (KRG), an autonomous regional government recognised under the Iraqi Constitution.

Political Overview

System of Government

Iraq is a federal constitutional democracy. The Head of State is the President (newly-elected Kurdish politician Fuad Massoum). The Head of Government is the Prime Minister, who is drawn, along with the Cabinet Ministers, from the Council of Representatives (CoR). Ministers forego their CoR seats to serve in Cabinet.  The Iraqi people elect the now 325 members of the CoR through an open-list, proportional representation electoral process. Seven seats are reserved for election by Iraqis living outside the country, and eight are set aside for representation of Iraqi minorities. Members serve four year terms.  

After Saddam's fall in 2003, the coalition established the Coalition Provisional Authority (CPA).  The CPA transferred sovereignty to the Iraqi Interim Government in June 2004 until national elections were held on 30 January 2005; thereafter the Iraqi Transitional Government assumed authority.   In May 2005, the Iraqi Transitional Government appointed a multi-ethnic committee to draft a new Iraqi Constitution, which was ratified in a nationwide referendum held on 15 October 2005. On 15 December 2005, Iraqis again went to the polls to participate in the first national legislative elections as outlined by the Constitution. The government took office in March 2006 for a four year term, and a Cabinet led by Prime Minister Al-Maliki was approved and installed in May 2006. The second national elections were held on 7 March 2010. After a prolonged deadlock the CoR approved a new Government of National Unity, led by Prime Minister Al-Maliki, in December 2010.

Most recently, national elections were held on 30 April 2014, despite conflict in some parts of the country. The Independent High Electoral Commission of Iraq (IHEC) estimated that 62 per cent of eligible Iraqis voted across the country. Australia was one of several countries where out-of-country voting took place. Results certified by IHEC on 17 June indicated that Prime Minister Al-Maliki’s State of Law bloc had won more seats than any factional rivals, though not an outright majority. This has prompted an extensive process of coalition-building.

A number of contentious issues remain unresolved by the CoR including proposed legislation to provide a framework for foreign investment in the oil and gas sector, to establish a process for the distribution of oil revenue and to resolve the disputed territories of Iraq. The draft Jaafari Personal Status law, which would constrain women’s rights in marriage and custody access to older children, is still to be considered by the CoR. Details of a national budget are still to be confirmed, especially in respect of allocations to the KRG, which had been suspended early in 2014 due to ongoing disagreement over oil exports.

Security

Following the overthrow of Saddam Hussein, Iraq witnessed widespread violence led by insurgent groups along sectarian lines, and against the coalition forces. The security situation improved slowly due to a combination of ongoing political progress and the increased capability of the Iraqi Security Forces (ISF), under the guidance of coalition forces. These successes allowed coalition forces to progressively transfer primary security responsibility to the ISF.

In December 2008, the Government of Iraq assumed full responsibility and sovereignty over the country, with foreign troops remaining in Iraq only with the agreement of the country's democratically elected government. 

The country continues to face major security challenges, with extremists intent on using violence to undermine the government and inflame sectarian divisions. During late 2013 and 2014 the terrorist organisation the Islamic State of Iraq and the Levant (ISIL) (also known as the ‘Islamic State’ and the ‘Islamic State of Iraq and Syria’) seized territory in west and northwest Iraq, including the city of Mosul.

The conflict created a major humanitarian crisis, displacing over a million people.  Australia has consistently provided humanitarian assistance, including to the UN High Commissioner for Refugees (UNHCR) and to the UN World Food Programme (WFP), which operate in Iraq.

The Australian Government advises Australians not to travel to Iraq; An Australian diplomatic presence remains in Iraq. However, Australia’s Embassy in Baghdad is closed to the public until further notice, due to the security situation, and consular assistance is no longer available within Iraq.  See travel advice for Iraq.

Bilateral Relations

Australia and Iraq enjoy a friendly and increasingly diverse relationship, with regular engagement on diplomatic, political and economic issues.  Australia and Iraq are represented bilaterally through Embassies in Baghdad and Canberra respectively.  Iraq has a Consulate-General in Sydney and the Kurdish Regional Government retains a representative office, also in Sydney.

Australia has had diplomatic relations with Iraq in various forms since 1935. Australia opened an Embassy in Baghdad in 1976; Iraq established an Embassy in Canberra in 1995.

After the closure of the Australian Embassy in Baghdad in 1991, and the closure of the Iraqi Embassy in Canberra in 2003, full diplomatic relations resumed when both Embassies reopened in 2004, following the transfer of authority from the CPA to the Iraqi Interim Government.

Australian forces joined coalition action against the regime of Saddam Hussein in 2003 and retained a contribution for the next eight years.  The withdrawal in August 2011 of the small number of remaining Australian military personnel, providing security to the Australian Embassy in Baghdad, ended Australia's military deployment in Iraq.   

People to people links

There is a sizeable Iraqi community in Australia. According to census data, at 30 June 2011, 50,450 people born in Iraq were living in Australia. Numbers of Australian residents and/or dual citizens registered to vote in the Iraqi elections suggest the Iraqi community may now total over 60,000. In addition, there are currently around 160 Iraqi students in Australia, sponsored by the Iraqi Government.

The resettlement of Iraqis who have fled their home country remains a priority within Australia’s offshore Humanitarian Programme.  In the last 10 years, around 22,000 Iraqis who have fled violence and unrest in Iraq have found a new life in Australia.  Iraqis were the single largest nationality granted visas under the offshore Humanitarian Programme over this period, with around one in every five refugees resettled in Australia coming from Iraq.  Many of the Iraqis resettled in Australia under the Humanitarian Programme have come from minority Christian communities, including many Assyrians.

Development assistance

Since 2003, Australia has provided $335 million in development and humanitarian assistance to Iraq to    re-establish services to over 1.3 million people, including over half a million refugees and internally displaced people. This is in addition to $987 million in debt relief to support Iraq’s transition to a stable and democratic nation after decades of war and dictatorship. Australia has worked in partnership with the Government of Iraq to improve agriculture research and rural development, public sector governance, education, landmine clearance and basic services delivery. Given Iraq’s ability to fund its own development, bilateral aid from Australia was phased down and ended in 2013-14.

Economic Overview

Iraq has the world’s fifth largest reserves of oil and gas, typically earning around US$8 billion a month in oil revenues.  Progress from a centrally planned economy to a more market oriented one remains uneven. Key challenges for the Iraqi Government include further increasing oil production, encouraging private sector development, improving service delivery (especially water and electricity), and ongoing security concerns.

In 2013, year-on-year inflation was 1.9 per cent. The Iraqi Dinar has replaced the US dollar as the main currency, and a functioning but small banking system and stock exchange now operate.  Iraq achieved real GDP growth of 4.2 per cent in 2013.  Due to the impact of conflict across the country and the resulting humanitarian crisis, Iraq will face significant challenges in maintaining its growth rates. Oil remains critical to the Iraqi economy, accounting for more than 95 per cent of government revenue and over 80 per cent of export revenue. Iraq produced 2.4 million barrels of oil per day in 2012, down from 2.6 million in 2012.

The key challenge for Iraq will be to continue to build capacity to use these substantial oil reserves to the benefit of current and future generations. As a middle income country Iraq has advanced to the point, where, in future years, it will be able to fund its own capacity building and development.

For more information on the Iraqi economy, please see our Iraq fact sheet [PDF 50 KB].

Trade and Investment

Historically, Australia's primary commercial interest in Iraq has been wheat, which it has exported to Iraq for over 50 years.  Australia’s wheat exports to Iraq in 2013 were valued at $581 million. A further $6.7 million in dairy products was exported to Iraq in 2013.  

The Australian and Iraqi Governments continue to work to broaden bilateral trade relations. In 2007, Iraq announced the opening of an Iraq Trade Liaison Office in Canberra and the appointment of a senior trade official to Australia. At the same time, The Australian Embassy in Baghdad and Austrade continue to facilitate commercial links between Australia and Iraq.

Australia actively supported Iraq's successful bid for observer status in the World Trade Organisation and will continue to assist Iraq to engage with the global economy.

Information on doing business and opportunities in Iraq

High Level Visits

March 2009: Prime Minister Nouri Al-Maliki visited Australia as a Guest of Government. As the first visit by an Iraqi Prime Minister to Australia, Prime Minister Al-Maliki's visit signaled a new phase in the bilateral relationship. During the visit, Prime Minister Al-Maliki and then Prime Minister Kevin Rudd signed a declaration on increased cooperation in six key areas and to enhance trade and investment ties. Memoranda of Understanding (MOUs) were developed on Agriculture; Resources and Energy; Trade Cooperation; Education, Training and Research; Public Health; and Security and Border Control.

June 2009, then Deputy Prime Minister, the Hon. Julia Gillard signed the six MOUs in Baghdad with relevant Iraqi Ministers, in the presence of Prime Minister Al-Maliki.  Implementation progress under these MoUs is reviewed at annual Senior Officials Talks, held annually. At the most recent round of talks, held in Baghdad in November 2013, agreement was reached to further develop these MoU arrangements.

May 2013: Dr Sargon Slewa, then Iraqi Minister for Agriculture, visited Australia together with a number of senior Iraqi officials.  His delegation visited South Australia and Victoria to discuss irrigation management, dryland farming and Australia’s grain and dairy capabilities.  Further reflecting the bilateral interest in food security, Victorian Minister for Agriculture, Peter Walsh, visited Iraq in January 2014, together with industry representatives.  This trip focused on Iraq’s interest in Australian rice, dairy and salinity management. Visits by Australia’s Ambassador for People Smuggling Issues, Craig Chittick, in July and November 2013, focused on facilitating bilateral collaboration and exchange on illegal migration and border control issues.