Baghdad (AsiaNews) – The year 2004 could well go down in history as a period of amazing economic recovery for Iraq, with its gross domestic predicted to grow by 33%. This is what authorities at the World Bank are saying.

However optimism about the Iraqi economy is not just felt by the international financial institution.  The bimonthly bulletin of the Dow Jones Group, "Iraq Reconstruction Report", also states that this year could lead Iraq to have the fastest growing economy in the world.     

Short term expectations are encouraging. "Right now" –the report reads – "millions of Iraqis are buying their first cell phones, satellite dishes, television sets, washing machines, air conditioners, cars, etc. Businesses are purchasing their first computers, mechanical diggers and all sorts of useful items."  

Even the Council on Foreign Relations (CFR), an influential organization backed by US top leaders, says that "significant progress" is being made in rebuilding the country and making for a solid political transition.      

Iraq's economy is worth 17-22 billon dollars, comparable to that of Luxemburg. Obviously Iraq's GDP in 2004 will depend on its level of internal production and number of exports related to its greatest resource –oil. The World' Bank's projections will hold true if Iraq's oil trade reaches pre-war levels, that is, producing 2.7 million and exporting 2.3 million barrels a day.  

Oil and its relative exports cannot make up for all funds necessary for rebuilding the country. According to projections made by World Bank officials, oil sales should yield around 13.5 billion dollars. 

The difference in reconstruction funds should be made up for by international aid. To date, the total international aid pledged now stands at 59 billion dollars distributed over several years' time, 28 billion of which come with formal commitments.

The United States says this year they will support 18 billion dollars in Iraqi reconstruction projects. According, James Schlesinger, former US secretary of defense and CFR co-president , American non-military expenses are calculated to reach 100 billion dollars. 

The World Bank bases its optimism also on certain significant reforms which have been passed in Iraq related to "freeing up prices, simplifying taxes, getting rid of customs duties and deciding to introduce a flat 5% tax on all imports."  Moreover food, medicine, clothing and books are all exempt from customs duties. Monetary reform has led to a 25% improvement in the exchange rate for Iraqi currency with respect to the American dollar.  

In terms of work, money and well being the Iraq Reconstruction Report admits that Iraqis are still very poor and suffer from a high rate of unemployment. However, the report says that a middle class is rapidly taking shape throughout the country and that there have been many benefits to citizens since the fall of Saddam Hussein's regime. Many jobs for Iraqis are said to have been created from business contracts linked to Iraq's rebuilding phase, as many American and other foreign companies hurry to sign deals with the Provisional Government. 

• iraq
• recostruction
• economy
• rebirth
• growth
• oil
• transition