The Arabic kingdom of Iraq suffered a loss in the sudden death of its young king, Ghazi, who died in an automobile accident on April 3. He was only twenty-seven years old and had succeeded his father, the first king of Iraq, in September 1933. The new King, Feisal II, was born in 1935. In view of his age a regency was instituted under Emir Abdul Ilah, a great uncle of the present King. This change in the person of the ruler had no influence on the policy of the kingdom. It remained faithful to its close military and political alliance with Great Britain and the outbreak of the great war found it cooperating in every respect with its ally. In addition, Iraq was bound to Turkey and Iran in the pact of Saadabad, and the new alliance between Turkey on the one hand, Great Britain and France on the other, concluded on October 19, increased the friendly relations between Turkey and Iraq. The Arabic pact which links Iraq to Saudi Arabia did not play any great rĂ´le in practical politics, but the present Iraqian Government is well known for its pan-Arabic leanings and has several times intervened in the situation in Palestine in favor of the Arabic population there.
The economic situation in Iraq remained unchanged, and the modernization of her economic life progressed only very slowly. On March 30, a law was passed according to which countries which export goods into Iraq without importing from Iraq will be obliged to buy Iraqian products up to at least the value of 25 per cent of their own exports into Iraq. The countries most affected by this new ruling are Germany, Italy, the Soviet Union and Japan. Iraq supplies the world only raw materials — above all, oil, but also barley, wool, dates, wheat and hides. The Iraqian oil is exported largely to Great Britain and France and represents one of their important oil sources. A certain progress was achieved in building roads and dams for flood control and in the modernization and strengthening of the Iraqian army. The greatest part of the budget went for these purposes. Towards the end of 1939 the general political uneasiness began also to spread to Iraq in connection with rumored intentions of the Soviet Union to make her influence felt in the direction of the Persian Gulf. In accordance with this situation military preparations were increased in Iraq, as throughout the Near East.
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