The impact of exchange rate fluctuations on exports in Iraq for the period (2004-2020)

Abstract

The research aims to clarify the impact of foreign exchange rate fluctuations on non-oil exports in Iraq during the period (2004-2020), The research problem focused on studying an important problem in the Iraqi economy, which is the lack of clarity and uncertainty surrounding the impact of foreign exchange rate fluctuations against the Iraqi dinar in the trade balance. The most effective parallel market during the period, (2004–2020), While the results of the standard analysis proved that the data of the independent variable and the dependent variable achieved the characteristic of stillness at the first difference for both variables, according to the unit root tests of (P.P) to ensure the inactivity of the time series and there are no integrated variables of degree I(2), Which necessitated the use of the ARDL model in estimating the relationship between the variables in the short and long terms, The results of the long-term response showed a weak adverse effect between the exchange rate and non-oil exports despite the increase in the exchange rate of the US dollar against the Iraqi dinar. It is noted that the volume of non-oil exports has decreased, this is due to the weakness of the production apparatus in covering the demand for goods and services. In addition, most Iraqi exports are oil exports, which are not subject to exchange rate changes, as their prices are set globally according to the forces of supply and demand. The exchange contributed in one way or another to the decline in the volume of non-oil exports.