Opinion: Now is the time for an Iraqi oil dividend
By giving oil revenue to citizens, Iraq can diversify its economy, reduce poverty, and start bridging national divisions, writes Middle East oil expert Johnny West.
Demonstrators attending a Feb. 2011 protest at Baghdad's Tahrir Square carry signs demanding that oil revenues directly benefit the Iraqi people. (BEN VAN HEUVELEN/Iraq Oil Report)
With its imminent surge in oil production, Iraq is more vulnerable than ever to the "resource curse." The influx of wealth threatens to distort the economy and deepen ethno-sectarian divisions by fuelling a political culture of rent-seeking, patronage, and corruption.
To forestall the worst effects of this problem, Iraq should distribute some of its oil revenues directly to the people. A properly structured dividend could address several of the country's critical development needs all at once – helping to alleviate poverty, diversify the economy, stimulate capital formation, and enhance transparency and accountability.
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