Iraq’s youth bulge threatens to buckle its weakened economy

Iraq’s youth bulge threatens to buckle its weakened economy
The Iraqi government has also been unable to prepare its population for the digital revolution that has rolled across the world over the last two decades adding to joblessness. (AP)
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Updated 10 March 2022

Iraq’s youth bulge threatens to buckle its weakened economy

Iraq’s youth bulge threatens to buckle its weakened economy
  • The Iraqi government is faced with huge challenges to prepare the country for its rising population on a range of fronts

RIYADH: Iraq has one of the youngest populations in the world, with seven million people between 14 and 29, but the country cannot put them to work.

The nation is faced with a significant youth bulge, which successive administrations have failed to harness to boost its weak economy.

Over 60 percent of Iraq’s population is under 25, and the youth population is projected to jump from seven to ten million between 2015 and 2030, according to a Save The Children report.

“This means that the government urgently needs to create jobs at an impossible rate, specifically in the private sector,” said Massaab Alousi, an Iraqi analyst in an interview with Arab News.

He added: “This leaves young people unprepared to compete for jobs regionally or internationally, because they do not have the necessary skills that private
firms want.”

The Iraqi government is faced with huge challenges to prepare the country for its rising population on a range of fronts, such as food security, economic diversification and infrastructure development, commentators note.

Feeding the country is already a major issue, despite its large swaths of farming land.

Between 2014 and 2017, farming revenue fell by almost half from around $15 billion to about $7.6 billion, due to Iraq and its allies’ war with Daesh, according to a report by US research body Atlantic Council. Agriculture’s value to the Iraq economy as a percentage of gross domestic product tumbled from around 20 percent before 2003 to 3.3 percent in 2019, according to the think tank. “There has also been a decline in fertile land, we have over 3 million dunum, or acres, of farming land that has been neglected that could produce food for the Iraq population,” said Hussein Thagab, an Iraqi journalist who specializes in economic issues, in an interview with Arab News.

This state of affairs has led to 4.1 million people needing humanitarian assistance in the country, according to UN reports.

Years of fighting in the country has left it awash with guns and many armed militias, which makes it hard for Iraq’s weak state to
put together a credible reconstruction plan.

The Iraqi economy is heavily dependent on oil, accounting for 96 percent of Iraq’s exports, 92 percent of government revenue, and 43 percent of GDP in 2019, according to Alousy.

The fact that Iraq’s rentier economy is based on oil, is unhealthy and unconstructive, noted Thagab. A rentier economy is one organized around income-generating assets, where overall incomes are dominated by rents and those that control them.

Thagab said: “Iraq has failed to organize, and diversify its exports and tap in its many resources such as gas and minerals and oil fields that are yet to come on stream.

“The legal system does not facilitate re-export, which hinders Iraq’s capabilities in being a transfer platform for the region.”

The Iraqi government has also been unable to prepare its population for the digital revolution that has rolled across the world over the last two decades adding to joblessness. “The most threatening aspect of the youth bulge is the high unemployment rate, which is 36 percent for this part of society,” added Alousi. There are close to 3.2 million school-aged Iraqi children that are not in education, according to Unicef.

The situation is chronic in conflict-affected governorates such as Salah Al-Din and Diyala, where more than 90 percent of children do not attend classes.

“As Iraq’s population grows while its conditions deteriorate the gap between the demands of the society and the ability of the government to respond to them is widening,” Alousy noted.

A rising population also piles further pressure onto Iraq’s dilapidated Iraqi infrastructure.

Over the past four decades, war, internal conflict and international economic sanctions have laid waste to the country’s infrastructure. The health sector has suffered not only during times
of conflict but also through a lack of funding during periods of relative stability.

Baghdad alone is estimated to need 70 new hospitals to cope with the capital’s expected population rise. The number of additional hospitals needed will be much higher in other less developed regions, experts note.

Roads are a little better. With the exception of the airport road, Baghdad highways look very much the same as they did 20 years ago under President Saddam Hussein, locals point out.

“The government should put in place a short-term plan of mass reconstruction that would employ many young people,” said Alousy.

A rising population is adding pressure on an already strained Iraqi economy, which has plenty of young people but is unable to give them the skills to find work.

Thagab added: “We lack training centers that can allow our youth to learn new technologies and increase their capabilities. Youth cannot be ignored, there should be plans to prepare them for future employment.”

Instead, hiring in the public sector has become an inefficient way the government has tackled the problem while not properly supporting the growth of private firms, Thagab noted.

He said: “The government has failed to promote laws that can make the private sector more efficient.”

Alousy said that the first steps Iraqi governments need to take are to address the rampant corruption in the country and dissolve its militias.

He added: “This would allow for more private investment in the country, implementing necessary reforms and long-term planning.”


Saudi Arabia calls on African mining industry to invest in Kingdom’s ‘rich, vast natural resources’

Saudi Arabia calls on African mining industry to invest in Kingdom’s ‘rich, vast natural resources’
Updated 08 February 2023

Saudi Arabia calls on African mining industry to invest in Kingdom’s ‘rich, vast natural resources’

Saudi Arabia calls on African mining industry to invest in Kingdom’s ‘rich, vast natural resources’
  • Khalid Al-Mudayfer, deputy minister for mining affairs, told the African Mining Conference in Cape Town the value of the Kingdom’s mineral wealth is estimated at $1.3 trillion

RIYADH: Saudi Arabia called on leading stakeholders in the mining industry across Africa to work together and benefit from the Kingdom’s rich and vast natural resources, to help support economic growth and social development.

Speaking during the African Mining Conference in Cape Town, South Africa, Khalid Al-Mudayfer, the Saudi deputy minister for mining affairs, said the value of the Kingdom’s mineral wealth is estimated at $1.3 trillion, the Saudi Press Agency reported on Tuesday.

He reviewed investment opportunities offered by the Ministry of Industry and Mineral Resources, along with the infrastructure and legislative capabilities of the Kingdom, which he said positions Saudi Arabia as the leading global destination for investment in the mining sector.

Al-Mudayfer, who inaugurated a meeting organized by the ministry for potential investors, highlighted the great opportunities he said were available in the Kingdom, and its efforts to develop its mining sector.

He spoke about the modernization of the mining investment system, which includes regulatory infrastructure for the sector and a clear, transparent and simple environment for investors, along with the availability of geological data for investors, improvements to basic infrastructure, and incentives for those who invest.

The Saudi delegation at the four-day exhibition included representatives from the Ministry of Investment, the National Industry Development and Logistics Program, the Saudi Geological Survey, and the National Center for Industrial Development.

The Saudi pavilion at the event showcases the Kingdom’s continual efforts to develop its mining sector by facilitating access to geological data and updating regulations and legislation to attract investors, build the foundations for sustainability, and develop a mining sector based on integrated value chains.


LEAP investment workshop uses Lego to encourage entrepreneurial culture change

LEAP investment workshop uses Lego to encourage entrepreneurial culture change
Updated 08 February 2023

LEAP investment workshop uses Lego to encourage entrepreneurial culture change

LEAP investment workshop uses Lego to encourage entrepreneurial culture change
  • David Gram-Hanssen of Diplomatic Rebels underscored importance of innovation and change while anticipating resistance
  • Workshop used Lego building blocks to demonstrate how a more experimental and entrepreneurial culture can be adopted

RIYADH: Interactive investment workshops were featured on the second day of LEAP’s second edition, with the spotlight falling on David Gram-Hanssen, co-founder of Diplomatic Rebels.

His workshop utilized Lego building blocks to help participants focus on the changes they can create in the future as they become diplomatic rebels in their respective industries.

He said: “Future success depends on the ability to explore and experiment. We all need to become even better at adapting to change.

“There’s a perfect storm of change happening right now geopolitically, environmentally, business-wise. Everything seems to be sort of moving, and over time that speed is only going to pick up.”

Diplomatic Rebels was a concept created out of the work of Lego’s radical innovation department, Future Lab.

It turned into a system and a way of thought that helped people navigate the bureaucracy of companies, sparking change in their offices and communities.

Gram-Hanssen, who previously worked at Lego Ventures, said companies needed to adopt this entrepreneurial culture.

He added: “At Lego we started saying as a mantra, radical is normal. It means that radical change and radical innovation is the new normal.

“We constantly have to move along and experiment and explore what is happening out there.”

He discussed what it means to be a diplomatic rebel, sparking innovation and positive change while anticipating resistance.

He said: “One of the things at Lego that we understood over time was when you’re working with radical innovation and trying to change things, it’s really hard work.

“One aspect to be mindful of is creating the necessary resilience in the teams you are working with.”

He explained that most entrepreneurs feel like they are constantly fighting the immune system of that existing environment.

He added: “They are trying to do something that doesn’t compute in the existing system.”

Gram-Hanssen gave his audience the task of building a Lego model to represent their work today and their vision for the future.

He also explained the concept of a “pretotype,” a predecessor of a prototype, which aims to gather data to aid faster testing, encouraging participants at the session to implement the concept in their daily lives.

He said: “The right question is not so much what is going to change and when, because it’s hard to foresee.

“Maybe the right question to ask is how do we take a lead on this change? What is it? What do we want to see in the world, and how do we put ourselves in front of this change?”

 


Nuclear energy offers ‘a golden opportunity’ to build a clean world

Nuclear energy offers ‘a golden opportunity’ to build a clean world
Updated 07 February 2023

Nuclear energy offers ‘a golden opportunity’ to build a clean world

Nuclear energy offers ‘a golden opportunity’ to build a clean world

RIYADH: Being a cost-effective and low-carbon solution, nuclear energy “offers a golden opportunity” to help build a clean world, according to the director general of the World Nuclear Association.

Sama Bilbao y Leon was speaking as a keynote speaker at the 44th IAEE International Conference in Riyadh on Tuesday. The top official said nuclear energy offers an opportunity to build a cleaner and more equitable world in which everyone has access to “clean, abundant and affordable round-the-clock energy and high quality of life.”

“As a low-carbon energy source, nuclear power can play a very important role, decarbonizing other difficult-to-able sectors,” she said.

The official said nuclear energy is certainly a cost-effective, low-carbon solution and a catalyst for economic development. It is more efficient than other sources when we think of energy transition, she added.

She, however, cautioned saying that much work is needed to deploy nuclear power with determination and speed.

Leon also pointed out that the current energy market is unstable, and there is a need to take a step back and adopt scientific approaches to make the sustainable energy transition a success.

Yousef Al-Ghamdi, executive director of strategic planning at the Saudi Electricity Co. noted that renewable energy will play an important role in energy transition, especially hydrogen energy.

Shihab Elborai, a partner at Strategy& Middle East, underscored the importance of technological advances to meet the challenges of climate change. He said recycling can help mitigate the climate effect and reduce carbon in the environment, therefore countries should invest in efficient technologies to improve the energy sector.

Peter Hartley, the George A. Peterkin Professor of Economics at Rice University, said natural gas is cheaper and a better option and as an energy source is going to stay. He added that nuclear energy is a costly affair.

Ayad Alamri, executive director for business development, at ACWA Power, said that PVC has a key role in clean energy management and distribution as we are aiming at a net-zero future.


Saudi, Hong Kong bourses sign MoU to explore listing opportunities

Saudi, Hong Kong bourses sign MoU to explore listing opportunities
Updated 07 February 2023

Saudi, Hong Kong bourses sign MoU to explore listing opportunities

Saudi, Hong Kong bourses sign MoU to explore listing opportunities

RIYADH: Saudi Tadawul Group Holding Co. has signed a memorandum of understanding with Hong Kong Exchanges and Clearing to work together to explore listing opportunities and collaborate in sectors such as fintech and environmental, social and governance, according to a tweet by the parent company of the Saudi Exchange.

The MoU reflected the HKEX’s “ongoing commitment to driving global connectivity and shaping a successful shared sustainable future,” said Nicolas Aguzin, CEO of the Hong Kong bourse operator.

“This MoU brings us one step closer toward enabling cross listings and other areas of collaboration between Saudi Arabia and Hong Kong,” Tadawul CEO Khalid Al-Hussan was quoted as saying by the Chinese media.

“As we seek to position the Saudi capital market as an investment hub between East and West, we are seeing increased interest from issuers and investors in Asia.”

 

 


Saudi Arabia-China Entrepreneur Association launched at LEAP

Saudi Arabia-China Entrepreneur Association launched at LEAP
Updated 07 February 2023

Saudi Arabia-China Entrepreneur Association launched at LEAP

Saudi Arabia-China Entrepreneur Association launched at LEAP

RIYADH: The Saudi Arabia-China Entrepreneur Association was launched at the LEAP 2023 conference in Riyadh on Tuesday.

The association — comprising over 100 Saudi and Chinese businesses, government entities, nongovernmental organizations, and academic institutions — seeks to boost cooperation between the private sectors on both sides along with bilateral ties at the government level. 

The nonprofit organization is supported by the Saudi Ministry of Communications and Information Technology and the Saudi Federation for Cybersecurity, Programming, and Drones. It will be operated by eWTP Arabia Capital.

“In line with Saudi Arabia’s Vision 2030, SCEA will enable cross-border investments and valuable collaborations,” said Jerry Li, founder and managing partner of eWTPA. 

The organization also plans to promote investment, encourage innovation, and develop social responsibility and public welfare.  

“China is a strategic partner for Saudi Arabia in terms of technology and innovation. Having worked closely with Alibaba and eWTPA for the last three years, I highly appreciate their efforts in contributing to the development of our local digital ecosystem,” said Faisal Al-Khamisi, chairman of the Saudi Federation for Cybersecurity, Programming, and Drones. 

Al-Khamisi added: “This association will take our collaboration to the next level and provide the broader Saudi-China business community with a forum to share valuable experiences.”