Shafaq News – Baghdad

Iraq, one of the world’s largest oil producers, continues to operate a capital market that captures only a fraction of its economic weight. Despite a 45% gain in 2024, the Iraqi Stock Exchange (ISX) remains valued at just 5% of GDP—a sharp contrast to regional markets where capitalization routinely exceeds 100%.

Latest figures from the Iraqi Securities Commission show market cap rising to 22.3 trillion dinars (about $17 billion) last year, up 19%. Yet participation remains thin. A Go-Globe assessment found women make up more than half of Iraq’s unbanked population, underscoring how little of the country’s financial activity reaches the formal economy.

This imbalance dominated Wednesday’s Future of Financial Markets conference in Baghdad, where senior officials pressed for structural change.

Ahmed Jawad Al-Dahlaki, director of the Finance Ministry’s Training Center, said Iraq cannot unlock its financial potential without innovation that expands access and broadens investor confidence.

Iraqi Securities Commission Chairman Faisal Al-Haimus pointed to the system’s core deficit: trust. He called for stricter disclosure rules, stronger shareholder protections, and enforceable investor rights, saying the market cannot grow if participants doubt its integrity.

Central Bank Governor Ali Al-Alaq argued that capital markets must evolve beyond basic trading and function as engines of economic diversification. He urged updated legislation and a rapid shift toward digital financial services to attract local and foreign investment.

The conference concluded with calls to better align monetary and fiscal policy and build regulatory frameworks capable of absorbing liquidity without destabilizing the market. The Finance Ministry said binding recommendations will be issued Thursday.

Read more: Deficit soars, projects freeze: Iraq heads into 2026 with NO BUDGET