Iraq tries to revive economy with oil pipelines and lotteries

All Baghdad needs these days is an ambitious young Madison Avenue executive to post billboards shouting: ''Bet on the Iraqi economy!'' Even without them, it is hard to miss Iraq's new campaign - from recently legalized betting on the horses and a new state lottery, to borrowing on world credit markets - to offset growing war strain on a once-gushing oil economy.

Oddly enough, the United States is emerging as one key in making the campaign work, notably as prospective credit guarantor and contractor for a strategic proposed oil pipeline via neighboring Jordan.

Pipelines, in general, are becoming a major focus of Iraq's revised economic strategy, as the war with Iran nears the end of its fourth sapping year. In addition to the trans-Jordan plans, the Iraqis are working to raise the capacity of an existing oil link through Turkey and seeking agreement on a third export outlet via Saudi Arabia.

For the first two years of the war, Iraq's economy thumbed its nose at every freshman economics course ever given by proving almost immune to the conflict.

Despite a sharp drop in oil earnings, Iraq dipped into ample reserves, arranged huge aid packages from fellow Arab oil states, and managed to do what is often impossible even in peacetime: to provide both guns and butter.

Iraq not only went actively into the international arms-purchase business but also actually expanded a multibillion-dollar economic development program at home.

But those days are over. Reserves of currency and gold aren't what they used to be. Nor is the world oil market.

These market changes have cut revenue on Iraq's already reduced volume of oil exports, as well as dented the capacity of fellow Arab states to help fund the Iraqi war chest.

So in the past year, Iraq has shifted economic gears:

* ''Austerity'' is one watchword. With tough public statements from President Saddam Hussein setting the tone, Iraq has cut back on nearly all but ''essential'' major development projects. Imports are now estimated to be running at roughly 50 percent of a year ago - with the exception of food staples sold to the Iraqis on credit by Brazil, the US, and various other countries.

* And ''credit'' is another order of the day. In prewar times, Iraq prided itself on paying cash, even for items for which most other countries would seek at least partial financing. For instance, in one single stroke before the war, Iraq left international businessmen aghast by buying its national airline a specimen of all available Boeing models on a single day.

But, says one of the British construction contractors who recently arrived here, ''Now, I come here not to do business but to try to collect on bills.'' And the Iraqis are in effect replying: ''Bet on the Iraq economy.''

They have fought - and in large measure achieved - agreements to defer payment of hard-currency bills for an average of two years on a range of projects, with Iraq's trading partners handling necessary credit arrangements.

Similar credit strategy applies to many of those new projects still going ahead.

* Another thrust of Iraqi strategy involves policies to raise revenue locally , keep the money supply manageable, and thus help constrain inflation that is now running at 25 percent. At times this has become literally a betting proposition. Two means of sopping up hoarded cash have been to legalize wagers at the cities' Nadi Al Furusiya, or Riding Clubs, and to inaugurate sales of pastel-colored tickets for a national lottery.

Another measure has been to encourage a campaign of popular donations of gold and jewelry by Iraqi women to the Persian Gulf war effort.

Still, the key to Iraq's strategy for economic recovery remains oil.

At war's start, Iraq was exporting some 3.5 million 42-gallon barrels of crude a day - OPEC's second-highest national tally. But the Iranians managed quickly to shut down Iraq's Gulf export outlets. And in 1982, rival Syria closed a pipeline that had ferried Iraqi oil to the Mediterranean. That left only one pipeline, via Turkey, with a daily capacity of 650,000 barrels. Combined with falling OPEC prices, this meant a drop of annual Iraqi oil earnings from a prewar $26 billion to an estimated $7 billion to $8 billion last year.

Though several months behind schedule, the Iraqis and Turks are now in the final stages of expanding their joint pipeline's capacity to about 1 million barrels daily. But the hope in Baghdad is to add another 2 to 3 million capacity within the next two to three years by building the new pipe outlets through Jordan and Saudi Arabia.

With the world oil market agush, Iraq could thus conceivably find itself with export capacity well above its currently allocated OPEC export quota of 1.2 million barrels a day.

Late last year Iraq's oil minister publicly recommmended an increase in his country's quota to 1.8 million barrels per day.

Yet, meanwhile, there seems an added, shorter-term reason the Iraqis are keen on the new pipeline projects - and on US participation.

A European diplomat here says, ''If the US is seen to back the projects fully , this could be an important boost for Iraq's efforts generally to encourage international confidence in its long-term economic prospects.''

Western businessmen and diplomats feel these prospects will remain solid, if the Gulf war winds down.

The short version of the explanation is this: Iraq has, in mere proven reserves, some 59 billion barrels of crude oil.