PANEL STUDY I: IMPACT OF COVID-19 ON SMALL- AND MEDIUM-SIZED ENTERPRISES IN IRAQ

16 September, 2020

 

Measures taken to curb the spread of COVID-19 have led to reduced operating hours or the closure of many of Iraq’s small- and medium-sized enterprises (SMEs). Although restrictions, including curfews, school closures, and restrictions on travel into and within the country, eased after the first few months of the COVID-19 response, the economic impact of the pandemic is expected to be severe. To measure the losses and investigate how SMEs are coping with movement restrictions, the International Organization for Migration (IOM) in Iraq, the Food and Agriculture Organization (FAO), and the International Trade Center (ITC) launched a panel study following 893 enterprises, focusing on 15 governorates and 16 sectors.

Findings show that COVID-19 has negatively affected production on average by 67 per cent, employment by 27 per cent, and monthly revenues by 63 per cent February and June. More than half of the businesses had difficulties accessing their most important inputs and four out of five SME owners faced lower domestic consumer sales. Almost three out of five SMEs interviewed reported that they were at risk of permanently shutting down. The most common approach was to reduce the number of employees, a strategy adopted by 34 per cent of the SMEs. A potential result of this coping mechanism is an increase in the gender gap among these SMEs by 30 per cent.

The first round of data collection took place from 22 June to 7 July 2020 and focused on. Two more survey rounds with the same 893 businesses will take place in September and December 2020 to continue analyzing the impact of COVID-19 crisis on production, labor, revenues and access to inputs.

 

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