Iraq-US trade declined to $12.0 billion in 2024, marking an 8.1 percent drop from the previous year. The decrease reflects reduced goods exchange, despite growth in services trade between the two nations.
Goods trade totaled $9.2 billion, showing a sharp contraction compared to 2023. Iraq imported $7.5 billion worth of goods from the United States, down 10.8 percent. At the same time, Iraq exported $1.7 billion in goods to the U.S., falling 25.9 percent. This left a goods trade deficit of $5.9 billion, which narrowed slightly compared to the previous year.
Meanwhile, the services sector presented a different picture. Iraq-US trade in services reached $2.8 billion, recording notable growth. The United States exported $2.2 billion in services to Iraq, up 23.9 percent. Iraq imported $532 million in services from the United States, increasing by 2.1 percent. This created a services trade surplus of $1.7 billion for the U.S., a 32.7 percent improvement from 2023.
Analysts attribute the decline in goods trade to lower demand for certain U.S. exports and shifts in Iraq’s import sources. In contrast, the services sector benefited from increased demand for professional, technical, and financial services. This helped offset some of the overall decline in Iraq-US trade.
Market experts note that fluctuations in Iraq-US trade can influence both investment flows and economic strategies. Lower goods imports from the United States may push Iraq to diversify its suppliers. On the other hand, higher services engagement shows growing cooperation in non-commodity sectors.
Iraq-US trade trends also play a role in shaping diplomatic and economic ties. Stronger services trade may encourage both countries to expand cooperation in technology, education, and infrastructure development. However, the goods trade decline could lead to discussions on improving market access and reducing barriers.
Economic observers believe Iraq will focus on balancing its trade portfolio. This includes boosting domestic production, increasing value-added exports, and attracting more foreign investment. Maintaining strong trade relations with the United States remains a priority, especially in sectors that support economic diversification.
As Iraq-US trade evolves, both countries will likely explore new areas of collaboration. The growth in services could serve as a foundation for deeper economic engagement, even as goods trade faces challenges.
