Prof. Dr. Haider Ali Al-Dulaimi Contrary to the prevailing belief that foreign capital enjoys special protection in times of war, developments on the ground have demonstrated that foreign-owned facilities and companies are not immune to damage. Since the escalation of military operations, factories, warehouses, ports, and commercial vessels belonging to major global companies such as ArcelorMittal, Bunge, and Coca-Cola have suffered substantial losses. The economic loss is not limited to the direct physical destruction of buildings and equipment. It also extends to operational losses—including production stoppages, disruptions to supply chains, and higher marine insurance and inland transportation costs—as well as long-term investment losses, such as declining market attractiveness and an increase in the risk premium. However, exposure to damage does not necessarily mean that companies will immediately withdraw. Rather, it reshapes their investment decisions by forcing them to weigh the cost of continuing operations against the risks associated with exiting the market. Implications for the Iraqi Economy The Ukrainian experience offers important and realistic lessons for the Iraqi economy and its investment environment, given the similarities in certain security and geopolitical conditions: 1. Vulnerability of Infrastructure and Supply Chains: As demonstrated by attacks on Ukrainian warehouses and ports, particularly in Odesa, any potential security tension or regional disruption could directly affect Iraqi ports, such as the Grand Faw Port and Umm Qasr ports, as well as domestic transportation networks. This could increase insurance and shipping costs and create inflationary pressures on domestic prices. 2. Attracting and Retaining Foreign Capital: Iraq relies heavily on attracting foreign investment in sectors such as energy, industry, and agriculture. The absence of a safe and stable environment supported by strong legal and insurance guarantees against political risks and conflicts could make international companies highly cautious or reluctant to commit to long-term investments. 3. Impact of Operational Losses on Local Markets: The disruption of any major industrial or food-production facility in Iraq due to security conditions would not affect the investing company alone. Its impact could extend to local suppliers, farmers, and the retail sector, negatively affecting employment opportunities and levels of food security. Economic Note The most important lesson from the Ukrainian experience is that the “cost of risk” has become one of the most significant—and, in some cases, decisive—factors in the investment decisions of global companies, at times outweighing the potential returns. This represents a fundamental challenge that Iraqi economic policymakers should take into account when seeking to strengthen the investment climate and enhance its resilience against regional crises.