Alcoholic Drinks in Iraq

Spreading peace and stability supported spreading demand for alcoholic drinks in 2019. With the Iraqi government having now regained control over most of the country and its oil industry, there are now good prospects for strong sales growth across the industry.

Market insight: COVID-19 impact

The most important impact of the COVID-19 pandemic on sales of alcoholic drinks in Iraq during 2020 was the major decline seen in non-trade sales in all categories. This was the direct consequence of the lockdown period that was in place from the middle of March until the start of Ramadan during the final week of April.

Country insight: COVID-19 impact

Iraq and the Kurdistan Autonomous Region introduced a nationwide lockdown and suspended international flights from 17 March. However, the curfew was eased for Ramadan, starting 24 April, including the reopening of select businesses, although schools, malls, mosques and restaurants remained closed.

Country insight: Pre-COVID-19

The majority of consumers in Iraq have a negative attitude towards alcoholic drinks and this is closely tied to the ban on alcohol consumption in Islam and the taboos surrounding alcohol consumption in orthodox Islamic society. Many Iraqis are not only unwilling to drink alcohol but also seek to prevent others from doing so.

Socioeconomic trends

Among low-income groups, alcoholic drinks are almost exclusively consumed by men through the off-trade, where prices are much lower. It is common among this consumer group to drink in order to get drunk at the lowest possible cost.

Logistics/infrastructure

It was once relatively easy to transport goods within Iraq, with products crossing the border into northern regions of the country before being distributed across the country. However, tensions between the Iraqi government and authorities in the Kurdish Autonomous Region complicated trade routes towards the end of the review period and resulted in supply shortages and additional distribution costs.

Legislation

Both the legal drinking age and the legal purchasing age for alcohol are set at 18 years old in Iraq. There were no changes to this legislation in 2019, with none expected during the forecast period.

Taxation and duty levies

Official taxation on alcoholic drinks has increased dramatically in recent years. Import duty of 80% on the sale price was introduced in 2011, with this being the same level as the import duty imposed on soft drinks.

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