Iraq eyes mining sector to reduce oil dependence and ‘diversify’ economy, says advisor to PM

BAGHDAD — Iraq is stepping up efforts to diversify its economy by investing in its long-neglected mining sector, targeting the development of key resources including phosphate, sulfur, lithium, and copper, according to Mazhar Salih, economic adviser to the prime minister.

Salih told the Iraqi News Agency that the country “is moving toward diversifying sources of its gross domestic product by expanding investment in the mining sector,” describing it as essential to reducing Iraq’s reliance on oil and unlocking the country’s untapped resource wealth.

Among Iraq’s most significant reserves are more than 10 billion tons of phosphate in the Akashat region of Anbar, as well as large deposits of free sulfur in Mishraq, Nineveh. Silica, critical in the production of glass, electronics, and semiconductors, is found in Najaf and across western Iraq.

Other valuable resources, including iron, manganese, copper, and gold, are distributed across the Kurdistan Region, Iraq’s western and central borders, and parts of the southern governorates.

The push to develop the mining sector comes as Iraqi officials increasingly emphasize the need for long-term economic stability beyond oil revenues, particularly in light of recent global market volatility and declining oil prices.

Mazhar Salih’s statement to Iraqi News Agency:

Iraq is moving toward diversifying sources of its gross domestic product by expanding investment in the mining sector, which has remained neglected for many decades. The government has signed memorandums of understanding with reputable international companies in the fields of mineral exploration and investment, particularly in the fields of phosphate, sulfur, lithium, and copper. This is in line with the strategic directions of the Iraqi government program to diversify national income sources and optimize the exploitation of the country’s resources.

Investment in the mining sector will contribute to attracting billions of dollars in fields ready for development, such as sulfur, phosphate, lithium, and other minerals.

The various reserves of underground wealth form a diverse stock of minerals, led by phosphate, which is estimated at more than 10 billion tons. Iraq ranks second globally in phosphate reserves, concentrated in the Akashat area of Anbar. Second is free sulfur, with Iraq possessing large reserves in Mishraq, Nineveh, considered among the world’s largest free sulfur fields. The third is silica, found in the Najaf region and western Iraq, used in glass, electronics, and semiconductor industries, and considered among the purest stocks in the world, according to global assessments.

Iron, manganese, copper, and gold are also present, distributed across different areas of Iraq, particularly in the Kurdistan Region and the western and central borders, in addition to southern Iraq, which holds massive reserves of other rare natural resources.

The policy of diversifying the national economy by extracting and processing mineral wealth for national industrial purposes, and then exporting it by maximizing value-added chains in manufacturing or semi-manufacturing industries, will initially contribute no less than 10 percent to the GDP.

This percentage will increase over time to become one of the pillars of national income diversification, especially if the connection between mineral investment and the development of national manufacturing industries—such as fertilizers, aluminum, glass, electronics, and renewable energy-related batteries—intensifies. This includes attracting foreign capital, advanced technology, digital services, and providing national job opportunities, investing in the Iraqi human being as a productive national energy.

The mineral diversification policy is considered one of the opportunities to implement the philosophy of sustainable development and to break the economy’s heavy dependence on oil. It is seen as an economic defense line against the volatility of oil prices, which directly affects state budget revenues.