Measuring and Analyzing the Impact of Foreign Trade on the Economic Growth of the Iraqi Economy for the Period (2006–2023)

Abstract

Foreign trade is an important factor in supporting economic growth by expanding markets and increasing production. In Iraq, it has gained particular importance following political and economic changes, due to the country's heavy reliance on oil exports, which makes its economy vulnerable to global fluctuations. This study aims to analyze the relationship between foreign trade and economic growth both theoretically and empirically, using a descriptive approach and the ARDL econometric model. The results show that crises—such as the 2019–2021 unrest and the COVID-19 pandemic—negatively affected the role of trade in supporting growth. The study also found a positive relationship between foreign trade and economic growth, with increased trade leading to an economic growth of 1.007 units. However, this relationship is statistically insignificant, as growth remains dependent primarily on oil exports, with little real economic diversification. The study recommends diversifying sources of national income, reducing dependence on oil, and developing a strategy to expand foreign trade and encourage national exports.