IMF Measures Wreak Havoc On Iraqi People

In all, $16 billion of US-sourced money has been spent on alleged reconstruction and social projects, along with as much as $40 billion of Iraqi funds appropriated by the occupation or in Iraqi government budgets. While Iraq’s infrastructure still lies in ruins, billions of dollars have flowed into the coffers of US companies like Haliburton, while billions more are simply unaccounted for.

The disastrous social conditions that exist for the Iraqi people after decades of war and nearly three years of US occupation are being dramatically worsened as a result of International Monetary Fund (IMF)-dictated economic restructuring.

In order to gain a $685 million IMF loan and the cancellation of some of Iraq’s $120 billion debt, the government of Prime Minister Ibrahim al-Jaafari secretly agreed in December to begin eliminating the subsidies that previously delivered the Iraqi people some of the lowest fuel costs in the world.

On December 19—just four days after the elections in which Jaafari’s United Iraqi Alliance (UIA) won more than 45 percent of the vote—the first cut in the fuel subsidy was implemented. The immediate impact was to increase the price of petrol, diesel, cooking gas and kerosene by an average of 500 percent. Petrol rose from just 3 US cents a litre to between 12 and 17 cents.

The broader impact has been soaring inflation, as the increased fuel and transport costs have been passed in the form of price rises for virtually every consumer good. The official inflation rate in January jumped by 5.8 percent to 22 percent. Food prices on average rose by 26.4 percent. A kilogram…

Posted by ShiftShapers
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