Sanctions led most people to a state of poverty

The sanctions against Iraq because of the invasion of Kuwait were established by the United Nations Security Council in August 1990 and were mandatory for all the countries in the international community.

Before the sanctions, an Iraqi dinar was worth 3 dollars; as from 1990, 1 dollar was worth 1,800 Dinars. During the first year of sanctions, 1991, GNP fell to the levels of the 1940s, before oil was commercialised. Before the sanctions Iraq had a diversified economy: the exploitation of hydrocarbons and their derivatives represented only 61% of GNP. As from 1991, the main economic sectors were the distribution and service industries with 81%.

In 1990, Iraq had a population of 17.42 million. According to the UN specialized agencies, the sanctions pushed over half the population below the poverty line and over four and a half million into extreme poverty. 60% of factories were forced to close and the rest worked at 10% their capacity. As a result, unemployment affected at least half the active population in the country, and this according to the most moderate estimate. Before sanctions, the country’s economy was a state-controlled system dominated by the public sector. The Iraqi regime decided to privatise economic sectors.