Foreign direct investment and its role in influencing unemployment rates in Iraq (An analytical and econometric study of the Iraqi economy)

Abstract

The current research starts from a basic problem, which is “Does foreign direct investment have a role in influencing unemployment rates in Iraq?” The temporal limits of the research are represented by the period 2004-2022 based on annual data, while the spatial limits are represented by studying the Iraqi economy, and in order to reach Problem and goal of the study: The researcher used economic measurement, and the research concluded, in the analogical aspect and through the (Ardl) model, that there was no effect in the short and long term of foreign direct investment on unemployment rates in Iraq during the research period, and this is due to the weak volume of foreign investment. In Iraq, most of it is in the oil extraction sector. It is also noted that foreign companies have relied on foreign cadres in their technical work since 2003 until now, and a small part of the Iraqi workforce, specifically in administrative work, so the Iraqi economy did not benefit from those companies in employing their expertise. In training national cadres, in addition to political and security instability and unqualified infrastructure, which are factors that hinder attracting investments to the Iraqi economy, especially in the industrial sector, the study therefore recommends the necessity of the government working to impose training of national cadres in foreign companies in order to gain experience and Skill and building national cadres capable of working in the field of oil extraction and then relying on them in the future in oil extraction management or in other investment fields. Otherwise, this situation represents a drain on Iraq’s economic resources and a burden on the balance of payments through external transfers from these companies to their home countries.