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The Power of Small Businesses in Iraq
In Iraq, where the national poverty rate can reach up to 50 per cent in some governorates, and unemployment rates hover around 15 per cent, small and medium-sized businesses are a key component of economic development.
Years of conflict have left many families in dire straits, with financial struggles threatening their food security and overall well-being.
Saliha, a resident of Mosul and a participant of the Individual Livelihoods Assistance (ILA) programme managed by the International Organization for Migration (IOM) in Iraq, shares her experience: "There were times when if we had lunch, we wouldn't have dinner that same day".
Saliha is like many women in Iraq who have been driven into poverty by the Daesh conflict.
Having lost her husband and son during the Daesh conflict, she is now responsible for caring for the rest of her family, including her son's family.
Saliha learned about IOM’s ILA programme from other participants and decided to apply. The programme aims to equip participants with necessary skills and provides a small grant to launch or expand business and other income-generating activities, fostering sustainable livelihoods.
After participating in livelihoods trainings on how to start, develop and manage a business, Saliha opened a small shop in her neighborhood in Mosul. This shop now provides for her and her family, helping them move away from the hardships of the past. Saliha also joined mental health and psychosocial support (MHPSS) sessions, which helped her in navigating past difficulties and build resilience. Saliha’s story is one of 20,000 other success stories of determined Iraqis who have received a push-start to their businesses through ILA across Iraq since 2018.
Similarly, Zikrah from Mosul lost her husband during the conflict and faced severe financial challenges. Struggling with extreme poverty, she had to work at a local shop for a long time, earning less than the minimum wage. It was during this period when she first enrolled in IOM’s Graduation Approach (GA) programme.
GA is a sequenced and time-bound programme that addresses the multidimensional nature of poverty. To help people like Zikrah battle extreme poverty and build sustainable livelihoods, the programme provides holistic support based on four pillars: livelihoods promotion, financial inclusion, social protection and social empowerment.
The GA programme marked a turning point in Zikrah's life. With the GA’s consumption grant she met her family’s basic needs, being able to focus on learning new skills to build a more resilient future. Equipped with insights from from various livelihood and financial literacy trainings, Zikhra gained essential skills to manage her own business. She also joined MHPSS peer-support group sessions and individual counseling to improve her mental health. Throughout her one-year GA journey, Zikrah has received continuous guidance through monthly coaching sessions and individual business mentoring.
"I knew a lot of the basics of the business,” shares Zikrah, “but working with the mentor helped me build skills in new areas." said Zikrah.
After a year of participation, Zikrah received a business support grant that allowed her to open her own home-based sweets factory. She now crafts a variety of sweets, supplying local shops and catering for events such as birthday parties and weddings.
Economic development and recovery can also be addressed at a higher level by supporting the expansion of small and medium businesses (SMEs).
Former engineer Marwa is a young entrepreneur from Baghdad, running an innovative business that turns food waste into potting soil for plant nurseries across Iraq. To expand her green business and promote sustainability, she applied for IOM’s Enterprise Development Fund (EDF) Green, aimed at creating new jobs and expanding businesses.
“It’s not food waste; it’s wasted valuable currency,” Marwa says confidently. With the grant, Marwa plans to expand her business, open four new jobs, improve irrigation in her recently opened plant nursery and expand packaging.
The other programs under EDF are EDF-Agriculture, EDF-Culture, EDF-Women, and EDF-Innovation. Thus, EDF supports businesses in different areas, helping create more jobs, ensuring a stable income and building a stronger, more resilient economy.
Since 2018, EDF has supported over 2,600 businesses across Iraq, resulting in the creation of nearly 12,000 new jobs and the improvement of nearly 14,000 existing jobs. Additionally, the EDF program has supported more than 600 women-owned businesses and a total of over 4,100 women in 15 governorates across various sectors. This support includes the creation of more than 2,300 new jobs and the enhancement of more than 1,800 existing jobs.
On all the different stages of creating new jobs, starting a small business, and behind every job opportunity is a story of a family taking steps towards financial sustainability, securing food, and education for their children. Many Iraqis face financial hardships, struggling to find gainful employment. However, with the right support and approach, it can be resolved.
These economic empowerment initiatives are supported by KfW Development Bank and the United States Agency for International Development (USAID).
