The Effect of Foreign Investment on Economic Growth – A Case Study of Iraq for the Period (2005-2019)

Abstract

This study aims to measure the impact of foreign direct investment on economic growth in Iraq for the period (2005-2019) ، through the nature of the relationship between the two variables at the level of economic theory، and then analyze the impact using quantitative standard analysis، given the role played by foreign direct investment in the structure Economic. As a cornerstone for the development and development of the national economy، the Iraqi government has given it a great role as one of the most important pillars of economic growth due to its role in supporting local savings and increasing the country’s production capacity.In addition، it is a source of modern technology and skills، as the lack of financial resources is one of the most prominent economic problems that the Iraqi economy suffers from، especially in light of the oil price shocks and the Corona pandemic، as well as the lack of technical personnel. Reconstruction as a result of the wars that led to the destruction of all its productive institutions، security and political instability، and the great financial and administrative corruption that Iraq was subjected to.Which in turn led to a low percentage of financial specializations for development projects، which contribute to raising the rate of economic growth in all economic sectors، and since foreign direct investment plays a major role in influencing raising economic growth rates، so Iraq aims to attract it and encourage investors to invest their money in it through Providing an appropriate investment environment capable of attracting foreign investments.

The study concluded that foreign direct investment has a long-term relationship to economic growth in Iraq. This was proven or demonstrated by statistical and standard tests and the (ARDL) model. The study presented a set of recommendations and proposals that would direct foreign direct investment towards productive sectors with the aim of promoting economic growth and developing structures Infrastructure، training and development of local human skills for the purpose of absorbing modern technology and not allowing foreign investors to bring technology that pollutes the environment.