E-commerce in Baghdad compared to neighboring countries It can be said that Baghdad has a good digital base in terms of internet penetration and connected youth, but it needs investments in logistics infrastructure and electronic payment systems.
The situation in Iraq (Baghdad in particular)
Internet penetration rate: حوالي 81% (more than 38 million users).
E-commerce market size: حوالي 131 million dollars in 2025, which is small compared to Gulf countries.
Number of online stores: about 729 stores, mostly focused on clothing and cosmetics.
Challenges: weak logistics infrastructure, heavy reliance on cash payments, and low trust in electronic payment systems.
Saudi Arabia
Internet penetration rate: about 99%.
Market size: حوالي 13.6 billion dollars in 2025, with a compound annual growth rate of حوالي 15%.
Growth factors: Vision 2030, shift toward digital payments, and the rise of quick commerce (Q-commerce).
Challenges: logistics coverage in rural areas and competition with global platforms.
United Arab Emirates
Internet penetration rate: nearly 100%.
Market size: between 8.8 and 12.3 billion dollars depending on estimates.
Growth factors: high income levels, strong logistics infrastructure, and dominance of mobile commerce (more than 75% of transactions).
Challenges: market saturation and slower growth compared to previous expectations.
Jordan
Internet penetration rate: about 92.5%.
Market size: smaller than Gulf countries but steadily growing.
Growth factors: strong urban concentration (92% of the population in cities) and high digital literacy.
Challenges: limited logistics infrastructure and a relatively small consumer market.
Comparative analysis
Size: the Iraqi market is still very small compared to Saudi Arabia and the UAE, where figures reach tens of billions.
Infrastructure: Baghdad suffers from weak logistics services and payment systems, while Gulf countries have advanced networks and strong digital financial services.
Government support: Saudi Arabia and the UAE benefit from clear policies such as Vision 2030 and economic diversification plans, while Iraq is still in an early stage.
Consumer behavior: Iraqis are highly active online and on social media (over 73% usage), but trust in electronic payments and delivery systems remains limited.
Iraq needs to work on:
Supporting government policies for startups.
Regional integration with larger Arab markets to benefit from expertise and opportunities.
With this, Iraq can gradually move closer to the level of Gulf countries in e-commerce while maintaining its local characteristics.
