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Is Iraq The Next Major Emerging Market? Iraq ETF Coming?

28 December 2009 18 Comments

Economic growth is a tough idea to fathom right now when it comes to Iraq.  Iraq is still fighting mightily to maintain security.  Without security, it’s tough to make economic progress.  From continuous research, even though the explosions and periodic deaths capture the majority of the headlines, there is real progress happening in Iraq.

I believe there is reason to believe that sometime in the future Iraq might enjoy a strong growing economy.  There are three major factors here:

  1. Continuing progress with security issues
  2. Oil exports
  3. A highly educated population

Thankfully, there is progress being made in area #2: oil.  Just recently, Iraq had a successful oil field auction where companies bid to operate massive oil fields in Iraq.  This is extremely crucial as Iraq needs money to flow into the country.  The money that can flow into the country in exchange for oil will help fund government programs, Iraqi security and future investments in the country.  As such, the more oil we see being produced, it’s probably safe to say, the more secure the country will get.  Progress is slow but steady.

One of the main differences why I think the Iraq war was more worthwhile than the Afghanistan war is because the Iraqi’s are actually very educated (other reasons include geography, oil, etc. — that’s for another discussion).  With freedom in Iraq, these educated people can turn this country and economy into something special.  I’m confident that this will happen.  It just takes time.  Afghanistan, on the other hand, well… I don’t know what the outcome there will be (and that is not a slap at Obama – I commend Obama for making tough decisions regarding the Afghan war – I tend to think we should pull out and come home).

As the Iraq becomes more secure and oil production moves higher, we could potentially see significant progress in Iraq in the coming years.  The Iraqi people are amazing and I think have the drive and the skills to make their country prosperous.  Did you know that Babylon (90 km south of Baghdad) according to Biblical prophesy is supposed to be the richest city in the world in the “last days”?  Take that for what it’s worth…

Iraq ETF

If the Iraqi economy moves forward over the coming years and is stabilized, you will see foreign investment continue to move higher, especially with regards to their massive oil reserves.  As such, since the ETF trend is still very powerful, I wouldn’t be surprised to see somebody offer an Iraq ETF.  It would be very interesting and excited to see this happen.  Obviously, we’re still a good ways off from that, but I’m hoping for the best in Iraq for the sake of the Iraqi’s.  I will continue to watch with excitement as good things happen there, and hopefully the bad things slow and eventually go away.

18 Comments »

  • John Polomny said:

    Why wait for an ETF you can invest right now on the stockmarket. Here is a link to the Babylon Fund which is a closed end fund that invests in Iraq. http://web.me.com/godvig/Godvig/Babylon_Fund_file… You can open a bank account with Warka Bank in Iraqi Dinars and buy stocks on the Iraqi stockexchange. There are several small oil and gas exploration stocks that are drilling in Kurdistan and trade on Canadian exchanges. I had one return 700% last year on a Jed Clampett type oil discovery. The same type of frontier market opporutunity is avaiable in Mongolia with less political risk. Check out my blog for more information.

  • Guest said:

    Careful comrade, you are not properly embracing the Party line. The Iraq war was a failure and we are not allowed to imply that anything resembling a "victory" will happen at any point in the next 1,000 years. We could have achieved the same results thru diplomacy like in Iran where our diplomacy will result in . . . nevermind, we've moved onto the next Party line which is cutting health care costs by giving people more free health care!!

  • 20smoney (author) said:

    Iran… oh boy..

  • RSFS said:

    ETF what is it, some kind of financial exchange with the U.S. and Iraq.
    can you tell me, thanks

  • IraqiXchange said:

    ETF is an exchange traded fund, meaning an index which would track the performance of the ISX (iraqi stock exchange)

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  • morzakk16 said:

    Economic growth is a tough idea to fathom right now when it comes to Iraq.  Iraq is still fighting mightily to maintain security.  Without security, it

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    Is the Iraqi Dinar re-valuing, or is it just going to keep floundering at the 'lowball' 1170 Dinar to the dollar?

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