Hybrid Economy: Iraq

Abstract

This chapter, in line with the other empirical chapters in this book, illustrates how top-down and bottom-up dynamics became distorted in the context of a liberal peace intervention. Also in line with the other empirical chapters, it concentrates on one aspect of the liberal peace — in this case, the economy. The chapter shows the emergence of a hybrid economy in the aftermath of the 2003 invasion and occupation. All national economies are hybrids, combining private and public sectors, large and small enterprises, and different forms of economic management and survival. The invasion and occupation, however, introduced a unique set of distortions to the already hybridised Iraqi economy. Importantly for the purposes of this book, the invasion and the consequent statebuilding exercise were conducted under a rhetoric of the liberal peace. This chapter examines both top-down and bottom-up aspects of the economy and illustrates the interactions between them, and how the policy choices of top-down and bottom-up actors were severely constrained by the actions of the other. No actor, not even the new masters of Iraq who had swept aside Saddam Hussein’s regime in forty-one days, had full autonomy. Instead, all economic actors were forced to deal with obstacles and opportunities presented by others. The focus of the top-down aspect of the chapter will be on Coalition-led attempts to rehabilitate the oil industry.