BAGHDAD – With wisps of smoke still rising from the remnants of another night of violence, the workers came in the morning to salvage what merchandise they could from the torched warehouses in Baghdad's central commercial district.
Boxes upon boxes of clothes, cosmetics and household goods stored by traders in the country's most thriving market were hurled onto pick-up trucks to be taken away from Rasheed Street, a historic avenue that for weeks has been scene of ongoing violence between anti-government protesters and security forces.
Stores were shuttered across the once bustling thoroughfare, where the chatter of bargain-hunters has been replaced by an occasional volley of bullets.
“We are loading and leaving,” said one merchant, Salah Redha. “My merchandise is worth over $1.5 million. Half of it is gone and the other half destroyed ... who will compensate me?”
With Iraq's leaderless uprising now in its third month, the protracted street hostilities, internet outages, blocked roads and a general atmosphere of unease are posing risks to Iraq's economy. In particular, the unrest has set back the most fragile segment of the country's economy, the private sector, where business owners have faced losses from damage to merchandise and disruptions of markets and from consumers reeling in their spending out of fear for the future.
So far, the unrest has not significantly affected Iraq's main economic lifeline, oil, which brings in $6-7 billion a month, up to 90% of the state's revenue. Oil exports have not faced disruptions, according to two senior oil ministry officials. Production has not been hurt by regular sit-ins blocking roads to major oil fields in the south, home to the vast majority of Iraq's oil resources.
But future investment is now in question, said Zaab Sethna, co-founder of Northern Gulf Partners, a frontier investment firm with experience in Iraq. Foreign investors have pulled out of deals in energy and other sectors, alarmed by the extent of Iranian influence in Iraq, highlighted by the heavy-handed security crackdown on demonstrations.
“We had an American backer ready to commit, to put money into Iraq, and they turned around and said, ‘Look everything I am reading says this is a place the Iranians are taking over and I am not going to put my money there,’” he said.