Monday, August 06, 2007


Closure of Iraq brick factories leads to dismissal of 80,000

(Iraq Directory) - Owners of brick factories (stone-concrete building) warned of exacerbation of production problems from which they suffer and have led to the closure of more than 400 factories distributed in Baghdad and the nearby provinces and the dismissal of over 80,000 workers.
The high cost of fuel, lack of electricity, and rising wages were the main reasons behind the sector's failure and lowering of its productivity so that the local product can no longer compete with Iranian brickwork which dominates the Iraqi market as it is sold at no more than $300 per four thousand bricks, while Iraqi brickwork is sold at around $600.
Working by one shift a day instead of the three run before April 2003 led to the decline of product, in addition to the difficulty of obtaining fuel necessary for the operation of the shops. Some buy fuel from the black market at high prices making it impossible to match import competition. The price of one tanker is $3000, hardly enough to produce 16,000 bricks which then sell at a price below production cost.
For example, the Rafidain shop used to produce about 24 million bricks annually before April 2003 using three shifts a day non-stop, using fuel at subsidized prices and selling with state protection of local product. It currently produces no more than 2 million bricks at best.
The State is blamed for the retreat of this sector activity due to the absence of support as well as the security problems which have harmed the performance levels of the facilities that are often forced to close. The Iraqi Industrial Bank used to provide loans to large and small plants to modernize equipment, in most cases imported via the Ministry of Trade at subsidized prices. Factory owners expect that brickwork prices will continue to rise if the problems mentioned are not treated, especially that of government support.

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