BAGHDAD, 24 January 2004 — Baghdad may shake with bomb blasts and suffer daily power cuts, but amid the chaos and disorder many businessmen and traders say the economy is coming around and prospects are steadily brightening. Every day, new stores open up or renovations are finished on others that have been run down for years, while trucks laden with goods brought from neighboring countries continually drop off supplies at shops in the city’s busy shopping districts.
Shop owners and businessmen say the sharpest changes have come about over the past three months or so as many Baghdadis have begun to spend the higher incomes they are now earning and the local currency has gained strength against the dollar.
A small improvement in security has also helped, although everyone is also quick to emphasize that huge dangers remain.
“There’s no question that things have improved over the last few months,” said Haitham Al-Damuk, 32, the manager of the Disney Island toy store in the Karrada district of central Baghdad, which turns over around $15,000 a month.
“Before, families might buy one toy a year for a child, but recently they have been coming in and buying two or three at a time and doing so more regularly,” he said, surrounded by boxes of Barbie dolls and Chinese-made remote-controlled cars.
Most of the evidence for any turnaround is anecdotal — there are few statistics in postwar Iraq apart from the number of US and coalition soldiers being killed — and those questioned always warn that things could easily change. But a variety of traders from shoe sellers to suit salesmen and the owners of car lots, electrical stores, supermarkets and furniture businesses all sense better times may be coming. “Business is getting better. We have lots of businessmen coming in and younger people are buying suits to look good for job interviews,” said Ahmed Mahmoud, 25, the manager of Assia, a smart menswear store in central Baghdad.
“We don’t open as late as we used to do because we’re still worried about security after dark, but bit by bit — God willing — things are getting better,” he said, as customers browsed through his imported suits which sell for between $60 and $130.
Gradually growing confidence is being fueled in part by increased spending as some Baghdadis’ disposable income rises.
Security guards — one of the most common post-war jobs — now generally take home about $60-80 a month, far more than the official 3,000-5,000 Iraqi dinars ($2-3.30) a similarly low-paying job would have earned under the former regime.
At the same time, over the past two months the dinar has strengthened sharply, gaining more than 30 percent against the dollar as the exchange rate has gone from more than 2,000 to around 1,400. That has created a sense of increased wealth. It’s also true that millions of Iraqis are without work and desperately struggling to make ends meet. And the buzz in Baghdad is clearly an exception to many other parts of the country.
In recent weeks, builders and electricians have been putting the finishing touches to a sparkling 1,200-square-meter showroom in downtown Baghdad that the owner claims will soon be Iraq’s biggest furniture store.
The owner, who refused to give his name because he said he feared envy, said he had pumped $1 million of his own money into the venture and believed he would recover that in three years.