Ba'athist Iraq reducing international oil prices, further weakened the Iraqi economy. In response to this, Saddam threatened Kuwait that, unless it reduced its oil output, Iraq would invade. Negotiations broke down, and on 2 August 1990, Iraq launched an invasion of Kuwait. The resulting international response led to the Persian Gulf War, which Iraq lost. The United Nations (UN) initiated economic sanctions in the war's aftermath to weaken the Ba'athist Iraqi regime. The country's economic conditions worsened during the 1990s, and at the turn of the 21st century, Iraq's economy started to grow again as several states ignored the UN's sanctions. In
Iraq–Kuwait relations within two days of intense combat, most of the Kuwaiti Armed Forces were either overrun by the Iraqi Republican Guard or escaped to neighboring Saudi Arabia and Bahrain. The state of Kuwait was annexed and proclaimed as Iraq's 19th province. During the Gulf War, Kuwait would soon be liberated by coalition forces. Since the fall of the Ba'ath Party regime in Iraq, relations have improved between the two states. On 25 April 2007, Kuwaiti lawmaker Saleh Ashour called in a statement for reopening Kuwait's embassy in Baghdad and for strongly supporting the government in Baghdad; Al-Ghanim, however, said he believes