In rows of black chairs, elderly men sit chatting, casting the occasional glance at projection screens displaying the latest market movements on the Iraq Stock Exchange. Occasionally, one gets up and wanders to the back of the darkened room, by the glass divider behind which the brokers sit. There's no one screaming orders or waving a fistful of tickets.
The relative inactivity stands in stark contrast to the hopes Iraqi and American officials had when the U.S.-backed exchange was reborn in 2004. Back then, expectations were that the toppling of Saddam Hussein a year earlier and the country's reabsorption into the international community would bring with it an economic reflourishing — and the bourse was touted as a tool to tap into the country's potential.
Instead, political deadlock and security fears have left foreign investors skittish about pumping money into Iraq, even though tens of billions of dollars are needed to rebuild everything from a dilapidated infrastructure to the private sector. Unemployment remains high, as does inflation, though it is far below the over 60 percent level seen just a few years ago.
And the stock market, a key economic engine in most major economies, remains another item in a list of postwar Iraq's unrealized hopes.
At the time of its launch, just over a dozen companies were listed on white boards hanging on the trading floor, located in a Baghdad hotel restaurant. Officials at the time projected that within a month, it would have 120 companies listed.
Six years later, only 85 companies are listed.
Its successes have been relative. It has moved into its own building. Instead of two trading sessions per week, it's up to a full five days. Most importantly, an electronic trading system has replaced the white boards.
"Every night, before I go to sleep, I thank God that I managed ... for the first time in the history of the Iraqi exchange, to introduce electronic trading," said Taha Abdulsalam, the ISX's chief executive.
And even amid the worst of Iraq's violence, in 2006 and 2007, when car bombings, assassinations and kidnappings were rife, investors came to every session. "We didn't suspend operations a single day," Abdulsalam said.
But it's clear much remains to be done if the exchange is to meet the hopes of its founders.
In its heady early weeks of trading in 2004, about $10 million in shares changed hands per session and share prices surged by as much as 600 percent. Now, with over three times the number of companies listed, the value of average daily trading is about $1 million, Abdulsalam said, adding that the market capitalization of the companies listed on the exchange stands at about $3 billion.
That's a level which Jan Randolph, director of sovereign risk analysis at IHS Global Insight, describes as "comparable to a medium sized supermarket" chain in the West.
"It's still very much of a frontier market," said Randolph. "The lack of data and liquidity means they ... wouldn't normally be included in any portfolio index of emerging markets."
Bank shares are the most actively traded, accounting for between 40 to 75 percent of the daily activity.
On Aug. 12, for example, about 564.2 million dinars ($505,109) worth of bank shares changed hands out of a total trading value of 921 million dinars ($824,300). There were a total of 230 trades executed on the market.
Mohammed Jamali, a 60-year-old investor and analyst, points to the rows of seats where the elderly men stare at projection screens. The large screens were installed because many complained their failing vision made it hard for them to read the flat screen TVs suspended from the wall in the back of the trading hall.
"About 10 percent of them are actively trading — and they do about 90 percent of the business," said Jamali. "The rest are just waiting around."
"Sometimes, they see an opportunity and they take it. They're being cautious."
Overall, the ISX's benchmark index is at around 92 points, down about 7.9 percent on a year-to-date basis. In relative terms, that's still better than the performance of the Dubai Financial Market and Abu Dhabi's exchange, regionally — though both are far larger markets.
The same security and political issues that have stunted development in much of the country weigh on the ISX's growth.
Foreign investors account for about four percent of daily trading in the market, Abdulsalam said. Officials hope the to see that number grow as major investment funds enter the market once a custodian bank is eventually set up.
But such changes need political decisions — slow in the best of times, and worse with the deadlock over forming a new government since March 7's inconclusive elections.
Investors want to see "the new government's economic face — it's economic policies," said Ali Jamal, a manager with brokerage firm Jawhara. The delay in a new government "directly affects the trading."
Infrastructure issues also hurt. Abdulsalam describes the notoriously spotty electricity service as Iraq's "fatal problem," raising costs for companies and households.
For now, Abdulsalam is looking ahead at what can be done. He wants to gradually have all 45 licensed brokerage houses work from their offices more and have the investors conduct their business over the phone or outside the exchange.
"This is the civilized thing (to do) ... It will reduce the security and other risks," he said.
Associated Press Writer Sinan Salaheddin contributed.