May 21, 2007

Iraqi Kurdistan: Investment from the Gulf


As Iraqi Kurdistan opens its arms to Gulf Investors, ambitious projects are being set up to rebuild and improve the region’s infrastructure.

As Iraqi Kurdistan opens its arms to Gulf Investors, ambitious projects are being set up to rebuild and improve the region’s infrastructure.

Below are extracts from an article written by Mayada Al Askari and published by Gulf News:

This is not Switzerland. But in its most enchanting spirit, high up in the Iraqi clouds and skies, is the Kurdistan province in Iraq. It has witnessed so much pain and misery throughout its history, we actually applaud its perfect beauty today.

With stability, peace and a willingness to develop the area, the Kurdish Regional Government put down the Kurdish Regional Investment Law No 4, which was issued in mid-2006.

According to Eamad Jamil Mazouri, the Kurdish Regional Government's General Representative to the UAE, the process to attract investment to Kurdistan started as early as 1992.

"When the Kurdish Parliament elections took place in 1992, we started building our regional state's establishments, we decided to tread the road of free enterprise as opposed to socialism, which did not work in Iraq as a whole. We also had to mend our devastated infrastructure," he told Gulf News.

According to Mazouri, when Nechirvan Barzani became prime minister in 1998, he introduced a whole new vision.

"He was highly interested in Dubai as a superb model of a dynamic fast-growing metropolis," Mazouri said.

After the end of Saddam Hussain's regime, Iraq voted on the constitution that approved a federal model for Iraq. In 2005, the Kurdish region constitution was issued.

Growing interest

The recent months have witnessed a growing interest in Kurdistan. In a recent economic conference in the UAE, a number of Gulf investors expressed their interest in energy supply, road and water projects, Mazouri said.

"We have actually finalised some contracts [with UAE entities] such as Dana Gas, Sharjah, which signed agreements with the Kurdistan Regional Government to study gas development and utilisation potential in Iraqi Kurdistan," he said.

The total cost of the project is $400 million.

Dana Gas and its Crescent Petroleum affiliate will launch an industrial gas complex concept called "Kurdistan Gas City", designed to promote private sector investment and employment.

Under a separate service contract, Dana Gas will develop, process and transport gas from the Khor Mor field on a fast-track basis. Dana Gas will also appraise Chemchemal gas field, which is needed to supply power plants under construction near the cities of Erbil and Suleymania, by January 2008.

The Kurdish regional government may also establish a free zone to attract more investments.

"The free zone will be established close to the Kurdish-Turkish borders in Zakho" Mazouri said.

A new $300 million airport is being built in the city of Erbil, which will be able to handle the biggest aircraft in the world, including the Russian Antonov 225 cargo plane and the American C-5 Galaxy.

The airport's new runway 18/36 will be one of the longest in the world at 4,800 metres.

Additionally, the Iraqi Kurdish regional government and a Dubai firm are also to build a $400 million "Media City" in Erbil.

Under the deal to create the Erbil City Media Company, the regional government will have a 60 per cent stake and a Dubai-based TV and cinema production company will hold the remaining 40 per cent. Six satellite television stations currently air from Kurdistan, which is home to hundreds of foreign companies, including 400 Turkish ones. This project is to see light in two years' time.

[…]

Mazouri was optimistic about the future. "The new policy has opened great opportunities for Kurdistan Al Iraq. We will soon see a tourist destination open to all the people in the area, a prosperous entity with open arms for all," he said with a smile.