Dichotomies abound in Iraq’s struggle against corruption

Too many dichotomies surround Iraq’s daunting struggle against endemic corruption. Ranked 157th in the Corruption Perceptions Index, it has been, often unkindly, described as a “kleptocracy” with “money laundering cartels” and a “gangster economy.” Transparency International ranked Iraq the world’s joint-10th most corrupt country last year.

A Brookings Institution analysis labels corruption as the Iraq invasion’s “forgotten legacy.” Another study pinpoints the reasons and drivers of corruption in Iraq as a sum of “violent conflict, the legacy of authoritarianism, the weak rule of law, poor quality institutions, and high levels of clientelism.”

Thankfully, more and more citizens and officials acknowledge the problem, even though their not-so-collective semblance of a fight has yet to succeed. Prime Minister Mohammed Shia Al-Sudani admits to corruption being one of Iraq’s biggest challenges, “no less serious than the threat of terrorism.”

Iraq’s anti-graft agencies once publicly displayed millions of dollars-worth of recovered public funds. They are asking Interpol to issue alerts seeking the arrest of former officials over the suspected theft of $2.5 billion from the country’s Tax Commission.

In 2008, Iraq acceded to the UN Convention Against Corruption, partnered with the UN Development Program and UN Office on Drugs and Crime to fight corruption, and signed a memorandum of understanding with France to tackle money laundering. A hotline is in place to receive corruption complaints. Digital platforms are on course to enhance transparency. Yet, a lot has stayed the same.

Despite conflicts, Iraq has witnessed green shoots, such as mild improvements in its health outcomes

Ehtesham Shahid

While still in office, former President Barham Salih described preserving public funds, fighting corruption and recovering looted funds as “an urgent public need.” To combat corruption, he even suggested an initiative similar to the international coalition to defeat Daesh. “We are suffering from corruption as we suffered from ISIS,” Deputy Prime Minister Fuad Hussein said in February, using another term for the terror group.

Implicit in these admissions are dichotomies between cause and effect, perception and reality, and between what is being done and what needs to be done. According to the Arab Barometer, 26 percent of Iraqis say corruption is Iraq’s most crucial challenge, more than the economic situation, foreign interference or instability. Nine in 10 Iraqis admit corruption to a great or medium extent in state institutions, “essentially unchanged since 2011.”

However, the roots of corruption run deep in Iraq, outlasting the cataclysmic events the country has grappled with in recent decades. Preceding the US-led invasion of 2003 were decades of authoritarian rule in which a centralized Baathist regime thrived on loyalty and patronage.

Since then, weak governance and institutions, a lack of transparency, insufficient legal frameworks and a deeply embedded culture of impunity have worsened the situation. Socioeconomic disparities frustrate people, making corrupt practices for survival acceptable.

From the international community’s perspective, washing one’s hands of a country’s persistent challenge does not help. Years before the invasion, the UN sanctions against Iraq lasted more than a decade, causing mass-scale malnutrition and death. Then came the much-touted “Oil-for-Food” program, ushering in massive fraud. Even the reconstruction influx created implicit corruption opportunities.

Corruption erodes public trust in government and institutions, leading to a cycle of cynicism

Ehtesham Shahid

A New York Times report from July 2020 stated: “The United States is deeply implicated in all this, and not just because its serial invasions wrecked the country and helped ravage the economy.”

One diagnosis leads us to “muhasasa” — Iraq’s “consociationalist” governance system — which, analysts argue, has cemented sectarianism, nepotism and state capture. All these factors have combined to make the “heist of the century” and other infamous corruption scandals possible.

Some signals suggest a decisive battle against corruption is indeed possible. Iraq is no longer subject to the Financial Action Task Force’s ongoing global anti-money laundering and terror financing compliance process. With a high percentage of its 40 million population aged under 25, the youth should be automatically detached from legacy issues of invasion and even terrorism.

Despite conflicts over the last two decades, Iraq has witnessed green shoots, such as mild improvements in its health outcomes. The country has among the world’s largest oil and gas reserves — worth at least $15 trillion, according to one official — which should be utilized to end a protracted economic and social crisis due to high unemployment, poor public services and extreme poverty.

Yet, Iraq’s electric power plants suffer from gas supply shortages and depend on imports from Iran. Strangely enough, OPEC’s second-largest oil producer makes headlines for the frozen bank account of its former oil minister over charges of corruption and receiving bribery.

Typically, corruption erodes public trust in government and institutions, leading to a cycle of cynicism and lack of engagement in the democratic process. Iraq seems caught in this vortex. Wriggling out of this should be its primary objective.

Iraq has all the ingredients to shine again. Its enormous natural resources can form the backbone of a robust economy. As a cradle of civilization, the country’s cultural heritage can attract tourism and international interest. Its geographical location makes it a potential hub for trade and regional connectivity.

With the scourge of corruption curbed, Iraq’s infrastructure drive becomes attractive for strategic investments supporting growth and connectivity. As the country rebuilds and modernizes, such opportunities abound. At some stage, Iraq will choose decisively between the welfare of its people and lining the pockets of its “kleptocrats.”