Political and security instability and its effects on foreign investment: with reference to Iraq's experience after 2003

Abstract

The research deals with the conceptual framework of political and security stability and foreign investment, the theoretical framework for the impact of political and security stability on foreign investment, and the practical aspect that affected political and security stability on foreign investment in Iraq for the period 2003-2021. The research aims to explain the reasons for the modest levels of foreign investment in Iraq and the fluctuation of its flows. Since 2003 and studying the causes of this imbalance, and among these reasons the security and political instability for the period under study, the Iraqi society was chosen as a sample for the research, and simple statistical tools were used in the analysis. The measurement method (SPSS) and linear programming were excluded because the results obtained are negative and do not explain Scientific explanation of the relationship between the two variables. Therefore, the method of direct analysis was resorted to through the tables obtained related to the index of political and security instability, and the results were positive and depended on solid scientific facts. On the outside world and then lift the economic sanctions imposed on Iraq, and the issuance of the investment law for the year 2006 had a great impact in encouraging the flow of foreign investment to Iraq. Although these flows are still modest and weak, and most of them are in the oil sector, and what indicates the obstacles to foreign investment are the security and political instability and cases of administrative and financial corruption were among the reasons that prevented the provision of an appropriate investment climate capable of attracting foreign investments. And the research recommended that Political stability is an attractive factor for foreign investors to invest their money inside the country because stability is one of the important elements for the investor and the economy of Iraq must be developed because Iraq’s economy is a one-sided renter economy that depends on oil and the development of the rest of the sectors to advance the economic reality and build a strong state. The instability index is considered one of the dangerous and important indicators, and due to the fluctuations of government systems and their unstable policies in recent times, this has led to a deterioration in conditions and a decrease in the demand for invest.

Keywords

• Foreign and domestic investment
• security and political instability