Iraq’s gateway for business
The relatively secure Kurdistan region is a place where businessmen need not fear for their lives, or their investments.
April 18, 2010 3:32 by Tanya Goudsouzian
As a delegation passes through the metal detector at a popular hotel in Erbil, the capital of Iraq’s Kurdistan Region, the alarm goes off. The guard puts his glass of tea aside and asks: “Do you have any weapons in your bag?”
“No,” replies a member of the delegation, all of whom are carrying bags, laptops, and cameras. The guard is satisfied with the verbal assurance and gestures that they may proceed.
In the past seven years since the American-led liberation that overthrew the Baathist regime, the Kurdistan Region has capitalized on its relative security, hailed as the gateway for business in Iraq. International public relations campaigns have marketed the region as “the other Iraq,” a place where businessmen need not fear for their lives or their investments.
The efforts of the Kurdish regional security apparatus Asayish have gone some way at ensuring that the roadside bombs and suicide blasts characterizing the center and south of Iraq do not cross the enforced no fly zone above the 36th parallel, also known as Kurdistan. Although there’s been a recent spate of kidnappings, sources play them down, saying there are not as many as reported and most are motivated by financial gains or clan rivalry rather than terrorism.
Since 2003, throngs of adventurous businessmen from the greater Middle East region and beyond have flocked to the two main cities of Iraqi Kurdistan to study the prospects for profitable enterprises, encouraged by the regional government’s progressive investment laws, which have lowered barriers for entry of new businesses and offered a slew of incentives. Investment opportunities span every sector, including oil and gas, electricity, energy, agricultural and the service industries.
Today, these two cities have morphed into fairly respectable trade hubs. Silver towers now the dot the once-dusty landscape of Erbil, and a number of equally imposing edifices have gone up in neighboring Suleimanieh, notably the soon-to-be-completed 39-floor Grand Millennium Suleimanieh, which mimics Dubai’s trademark Burj Al Arab hotel.
Official figures say the region received $16 billion worth of investments in 2008 alone, half of which came from Gulf Arab countries, although the largest single investor is Turkey. These have mostly gone toward the oil and gas sector, followed by infrastructure projects and the real estate sector. As per 2009 figures, non-oil investment in the Kurdistan Region totalled more than $12 billion over the last three years. The Kurdish region emerged more or less unscathed from the global financial crisis, as it is not directly linked with the global economy through trade agreements or investment funds.