Insurgency
Since the fall of Saddam Hussein in April 2003, insurgents have grown in strength and sophistication and are mounting daily ambushes, mortar attacks and suicide bombings on US-led troops, Iraqi security forces, Government officials and Shiite groups.
Thousands have been killed and some areas of Iraq, particularly in the
Sunni Muslim heartland, are effectively under the control of insurgents.
Faltering reconstruction
Hopes Iraq's oil could pay for quick reconstruction have been dashed.
Sabotage of oil infrastructure has badly hit exports, the economic lifeblood. The Government estimates several billion dollars in potential revenue has been lost.
Insurgent violence has hampered reconstruction in several areas of Iraq, and as a result promises of jobs and prosperity have failed to materialise.
Fuel is scarce, power cuts are frequent and water is sometimes cut off - all adding to the resentment felt by ordinary Iraqis.
Even the mobile phone network, which was hailed as a big step forward when it was unveiled early year, has started to collapse, with coverage interrupted for hours at a time around Baghdad. Insurgents have also used it to detonate bombs remotely, creating more complications.
Ethnic, sectarian divisions
Iraq is a tapestry of ethnic and religious groups. About 60 per cent of the population are Shiite Arabs, and the country also has sizeable Sunni Arab and Kurdish minorities as well as Turkmen and Christians.
Most Shiites, oppressed under Saddam, supported the polls, but many Sunni Arab groups threatened to boycott them, saying violence meant the vote would not be free or fair.
The new Government, likely to be dominated by Shiites, will have the difficult task of reaching out to Sunni Arabs.
There are also tensions over the status of Iraq's Kurds, who have controlled an autonomous zone in northern Iraq since 1991.
Some Kurds want to expand their territory to include the strategic oil city of Kirkuk, but this is fiercely opposed by Arabs. The Kurdish and Turkmen communities also have a long history of mutual resentment. Some Kurds say they favour breaking away from Iraq if their aspirations are not met.
Foreign troops
The presence of US-led foreign troops in Iraq is a source of bitterness for many Iraqis, even those who do not support the insurgency. Most Iraqis say they want foreign troops to leave as soon as the country is stable enough to allow this. But Iraqi security forces remain under-trained and ill-equipped.
- REUTERS
