kurdistan region republic of iraq - upper reach

See this report at worldfolio.co.ukTuesday, January 15, 2013An advertisement supplement by UPPER REACH

Since the ending of the war in Iraq in2011, diplomatic and trade ties have

never been stronger between Britain andKurdistan. Government representativesfrom both the UK and Kurdistan are urg-ing British businesses to be part of theIraqi autonomous region’s bright andprosperous future. Foreign investment,particularly from Britain, has been pour-ing in and there have been exciting de-velopments in its oil and gas, financial,real estate and energy sectors.

The region is Iraq’s most progressive,economically developed and safest. Kur-distan was shielded from some of themore devastating effects of the eight-yearwar and now, thanks to both diligent se-curity and the determination of its people,it remains a safe haven, free from terror-ist attacks. The Kurdistan Regional Gov-ernment (KRG) is eager to tell the worldthat this peaceful and flourishing regionis open for business and hungry for change.

British Foreign Secretary William Haguerecently announced his intention to in-crease staffing levels at the British Con-sulate in Erbil, Kurdistan’s capital, sig-naling his intent to further strengthendiplomatic and trade ties. In a statementreleased by the Foreign Office, Mr Haguesaid: “the review of our resources in Iraqhas confirmed that the Kurdistan Regioncontinues to attract significant interestfrom British businesses.”

Mr Hague pointed out that recentlyover 40 British companies had attendedthe Erbil International Trade Fair, which

was supported by UK Trade and Invest-ment (UKTI). He also announced that aUKTI Commercial Attaché would be ap-pointed to widen the Consulate Gener-al’s already successful commercial sec-tion. Finally, the Foreign Secretary saidthe British Consulate-General in Erbil willbe maintained “on a permanent footing.”

The consulate at Erbil was establishedin 2011 in recognition of the need for amore permanent diplomatic base in Kur-distan. “We remain deeply impressedwith the success of Erbil,” Britain’s Min-

ister for the Middle East, Alistair Burt,said at a recent London conference host-ed by the KRG.

Kurdistan’s thriving economy attract-ed a total of $3 billion in foreign invest-ment during the first six months of 2012,which looks to be a record year; total for-eign investment for the past five yearswas $17 billion.

More than 450 foreign companies areregistered to do business in the region,whose GDP rose 8 per cent in 2011, whenthe jobless rate was only 6 per cent.

British businessmen are among thoseshowing interest in Kurdistan. Compa-nies currently operating in the area in-clude Heritage, Gulf Keystone and Ster-ling, all of which have made significantinvestments in Kurdistan’s oil and gassector; construction and engineering firmParsons Brinkerhoff; Jones Lang Lasalleand BTW Shiells, who have helped to de-velop Kurdistan’s ultra-modern, multi-million-pound shopping malls; HSBC andStandard Chartered, the only two globalbanks in Kurdistan; as well as four world

leaders in accountancy services, KPMG,Deloitte, PWC and Ernst and Young.

Relations between Britain and Kur-distan have been very warm for the bestpart of 20 years. In 1991 – when SaddamHussein’s troops were launching a se-ries of attacks against Kurdistan – then-prime minister Sir John Major led themove to have the United Nations declareKurdistan a safe-haven and a ‘no-fly’zone.

The decision saved the lives of thou-sands of Kurds and later led to the es-tablishment of the Kurdistan RegionalGovernment. The people of Kurdistanstill hold a deep gratitude to Britain forits role in helping them become a safeand autonomous region with its owndemocratically elected government.

Today, according to former British Con-sul General to Kurdistan, Chris Bowers,“there is a huge appetite in the Kurdis-tan Region to engage with the interna-tional community, primarily the West,to make up for the lost decades of iso-lation... within that context, Britain retainsa special place in the affections of manyKurds.”

Mr Bowers also stated that: “One ofthe roles of the Consulate General is totell UK companies that Kurdistan is openfor business and to come and see it forthemselves.”

KURDISTAN PROJECT TEAM: Sophia Shepodd-Bhuiyan and Tom HillRegional Director: Gonzalo del Rio

Foreign Secretary William Hague’s decision to expand the British Consulate in Kurdistan signalshis intent to strengthen diplomatic and trade ties with Iraq’s most prosperous region

Kurdistan and the UK: forging stronger links

Lower left: Kurdistan Regional Government (KRG) President Masoud Barzani

REPUBLIC OF IRAQ

UUPPPPEERR RREEAACCHH:: 68 King William Street,London EC4N 7DZ Tel: +44 (0) 207 959 2424 Fax: +44 (0) 207 959 2201

KURDISTAN REGION

KKuurrddiissttaann’’ss oouuttssttaannddiinngg eeccoonnoommiicc ggrroowwtthhhhaass bbeeeenn ddrriivveenn pprriinncciippaallllyy bbyy ooiill rreevveennuueess,,aa sseeccuurree iinnvveessttmmeenntt eennvviirroonnmmeenntt aanndd aa ccoonnssttrruuccttiioonn bboooomm

Although the capital city of Erbil is peppered withcranes, infrastructure and many basic servicessuch as electricity and water are still faulty in

some areas. This hasprompted the Kurdistan

Regional Government(KRG) to set theseas the focus of itsaction.“Infrastructure isa key priority forthe Ministry,”says Minister ofFinance andEconomy Bayiz

Saeed Moham-mad Talabani.

“Above all, we want to provide more services tothe Kurdish people. We want to expand the ser-vices given to the people so that they may livewith dignity.”

To that end, the government has been spend-ing heavily on projects such as the new inter-national airport at Duhok (the region’s third)and the five new dams that are currently beingbuilt. They include one at Litan, northwest of Er-bil, with a capacity of 2.23 million cubic metres.Rural and urban development, health care, agri-culture and microfinancing for small businesseshave also received government support.

For example, the Minister says the KRG ad-ministration spent 643 billion dinars ($563 mil-lion) on real estate development projects incities and another 560 billion dinars on agri-cultural development. To date, a total of 70,000people have benefited from these programmes.

Health care has been a primary focus of thegovernment’s attention. The Finance Ministerpoints out that between 2003 and 2012, closeto 300 new hospitals were built – more thanwere built in Kurdistan between 1920 and 2003.

The region now has 12 universities – 11 morethan in 1991 – which provide higher educationat no cost to the students, who also receive amonthly stipend. Recent graduates are giventhe opportunity to continue their education over-seas; of those who do, some 85 per cent chooseto study in the United Kingdom.

FINANCE MINISTER: INFRASTRUCTURE, BASIC SERVICESARE KEY CONCERNS AA lliibbeerraall iinnvveessttmmeenntt llaaww aanndd aa tthhrriivviinngg

eeccoonnoommyy aattttrraacctt ffuunnddss ffrroomm aabbrrooaadd

Foreign investment in Kurdistan was headed for arecord year in 2012 as investors from around theworld become more aware of the opportunitiesand advantages the region offers.

During the first six months of 2012, more than$3 billion of new investment came into the regionand the total of both foreign and domestic fundswere forecast to reach $7 billion for the entireyear. Halfway through the year, more than 450major development projects were under way, witha total value of over $21 billion.

Target areas for foreign investment include agri-culture, banking and insurance, energy, ho-tels, health, ICT, industry, tourism,transportation and infrastruc-ture projects.

Eager to over-come the concernsabout security is-sues, Kurdistan haspassed one of the mostliberal foreign investmentlaws in the Middle East. Itprovides a series of incen-tives to investors, including a10-year tax holiday, the possi-bility of owning land and freedomfrom export and import tariffs forgoods related to investment projects.

Foreign investors receive the samelegal treatment as their local counter-

parts. Additionally, profits can be repatriated andcapital as well, if the project is liquidated. Employ-ers are permitted to use foreign labourers, who al-so have the right to remit their earnings to their homecountries.

The largest source of foreign investment in Kur-distan is Egypt, which during the first five monthsof 2012 accounted for $497 million, followed byLebanon with $231 million.

Official data indicates that there are approxi-mately 1,600 foreign companies registered in Kur-distan, up from 1,170 in 2010. Between 50 and 60per cent of all foreign investors are Turkish.

From 2006 to mid-2012, overall investment inKurdistan, including foreign invest-

ment, amounted to $22 billion.

FOREIGN INVESTORS’ INTEREST IN KURDISTAN GROWING

Kurdistan’s economic growthdriven by more than oilSectors such as housing, tourism, trade and agriculture are contributing ever more to the country’s GDP

KURDISTAN2An advertisement supplement by UPPER REACH

Kurdistan’s impressive economic growth, esti-mated at 12 per cent during 2012, has been

driven largely by the country’s oil industry. How-ever, the government’s Regional DevelopmentStrategy is betting on more growth in other sec-tors, notably housing construction, agricultureand tourism, to maintain the pace of economicdevelopment.

The Regional Development Strategy for theKurdistan Region 2012-2016, designed by theMinistry of Planning, sets some ambitious goalsfor the next four years. They include reducing theunemployment rate from 17 to 4 per cent, creat-ing 100,000 jobs a year and achieving an aver-age annual GDP growth rate of 8 per cent.

That growth would include an expansion of theagricultural sector by at least 15 per cent, manu-

facturing industries by 5 per cent and the tourismsector by 7 per cent.

Although Kurdistan’s economic future will bemarked by the potential of its oil industry, thecomposition of its GDP already shows the risingpower of other areas of the economy. Housing cur-rently represents 20.6 per cent, while tourismcontributes 19.3 per cent, trade 14.5 per cent, andagriculture 6.8 per cent, according to figures fromthe Kurdistan Board of Investment.

In the fast-growing housing sector, according toBloomberg, Kurdistan will need to spend 200 bil-lion dinars ($175 million) a year on home con-struction during the next decade to overcome anexpected shortage. This would suppose building5,000 housing units a year and investing 200 bil-lion dinars annually to implement this plan.

In the tourism sector, the country is trying totake advantage of its archaeological sites – forexample, the ancient area around the capitalcity, Erbil – which have been singled out bypublications such as National Geographic mag-azine or the New York Times as among themost attractive in the world.

As for the agriculture sector, the Regional De-velopment Strategy foresees a “10 per cent in-crease in annual use of agricultural land; pro-viding protection for 80 per cent of cultivableland against desertification and damage duringfive years; and increasing the water storage ca-pacity up to 5 per cent of available river flowsduring five years, through building four damsduring the period (2012-2016).”

However, the basis of Kurdistan’s economic

growth will continue to be oil and gas. The re-gion holds approximately a third of Iraq’s totaloil reserves, or about 45 billion barrels. The re-gion’s current production stands at 100,000barrels of oil per day, but plans are to raise out-put to 1 million barrels by 2015, with at least10 per cent of the total devoted to exports.

Over the past year, the country has begun toexport directly and to sign contracts with theforeign oil majors, Exxon Mobil Corp, Total SA,Chevron and Gazprom.

Kurdistan’s gas reserves could well becomea key source of supply to Europe and Turkey,once the planned Nabucco pipeline comes on-line. The KRG government plans separate ex-port pipelines direct to Turkey in next twoyears.

Bayiz Saeed MohammadTalabani, Minister of Finance and Economy

Source: Kurdistan Ministry of Planning

KURDISTAN 3An advertisement supplement by UPPER REACH

Closer ties with the UK ininvestment and educationHigh Representative of the Kurdistan Regional Government (KRG) to the UK, Bayan Sami Abdul Rahman, speaks about the keypriorities for KRG, its relationship with the Iraqi federal government, the region’s investment pull and bilateral ties with BritainWWhhaatt ggooaallss wwoouulldd tthhee KKRRGG lliikkee ttoo aacchhiieevvee aass iitt ccoonn--ttiinnuueess ttoo mmoovvee ffoorrwwaarrdd iinn tthhee pprroocceessss ooff aacchhiieevviinnggggrreeaatteerr ggrroowwtthh aanndd ssoocciioo--eeccoonnoommiicc ddeevveellooppmmeenntt??

We want to give our people a better life. We can do thatby making sure that our region is secure. I think we havedone that successfully. Beyond that, we want to createprosperity and wealth for our people. The prosperity iscoming, and the security is there. We want to give ourpeople better health care, education and access to therest of the world. We want to have good relations withinIraq, and we want to have good relations international-ly, with key countries like Britain and the US, as well asother countries across Europe and the region.

IInn tteerrmmss ooff iinnvveessttmmeenntt,, wwhhaatt aarree KKuurrddiissttaann’’ss ccoomm--ppeettiittiivvee aaddvvaannttaaggeess??

Kurdistan is a forward-looking, democratic and sec-ular Muslim society. We have an extremely investor-friendly investment law – many companies havesaid it is the most friendly that they have seen. Kur-distan is very stable. This is especially relevant in theMiddle East. Here, we have had a peaceful transfer ofpower, and peaceful general elections. It may not beas mature as a Western democracy, but we are deep-ening and strengthening our democratic credentialsevery single day.

AAss tthhee KKRRGG HHiigghh RReepprreesseennttaattiivvee ttoo tthhee UUKK,, hhooww wwoouullddyyoouu aasssseessss tthhee ccuurrrreenntt bbiillaatteerraall rreellaattiioonnss bbeettwweeeennKKuurrddiissttaann aanndd tthhee UUKK??

I would say that they are very good, solid and detailed.We cooperate in many areas, such as in trade, invest-ment and education, which have benefited both sides.

Apart from diplomacy, business and education, thereis a lot of other cooperation between Kurdistan and theUK. It has more to do with helping society to deal withvery sensitive issues, specifically in the area of hu-man rights.

Almost 90 British businesses are registered in Kur-distan. As far as foreign companies go, the UK has the

fourth largest business presence in the region, afterTurkey, Iran and Lebanon.

The real number of businesses is far greater than 90.There are many more British companies that do busi-ness in Kurdistan without having to register. It alsodoes not include those in the oil and gas sector, becausethey are always treated separately because the sec-tor has its own law. Oil and gas companies do not fallunder the investment law, either.

Education has become central to the blossoming re-lationship between Kurdistan and the UK. The majorityof the postgraduate students under KRG’s $100-millionannual scholarship programme have elected to go tothe UK to study. The British universities are doing verywell as recipients of those students. The British Eng-lish language institutions are also doing very well be-cause the students need to do a year of English. In ad-dition, British universities are very much engaged inaffiliations with Kurdish universities. Middlesex is think-ing about establishing a campus. Leicester Universityhas established an English Language Centre in Kurdistan.The universities are not only benefiting from the schol-arships, they are also going to Kurdistan.

WWhhaatt aarree yyoouurr mmaaiinn aarreeaass ooff ffooccuuss ffoorr tthhee eeccoonnoommyy??Oil and gas is a big sector for us. It is not just explo-

ration; there are also oil and gas services. It is defi-nitely an area to watch. It is a sector that is boomingin Kurdistan, with both local and international compa-nies increasingly coming to the region to support thebig explorations.

Agriculture is an area we are focusing on. Kurdis-tan, after all, was the breadbasket of Iraq. Our Ministryof Agriculture is trying to give our fruit-growers andwheat-growers an advantage against all of the verycheap imports.

Tourism is another priority. We can focus on two keyareas. First, we have heritage products like our biblicalsites. Some of the great prophets of Judaism, Islam andChristianity are buried in Kurdistan. We have Roman

sites and the place where the battle of Alexander theGreat took place. We have the citadel in Erbil, whichgoes back 7,000 to 8,000 years, making it the longestcontinuously inhabited city in the world. Second, we haveadventure tourism. By that, I mean we have moun-tains and rivers where we can promote all sorts of na-ture sports like mountain climbing, river rafting and ski-ing. Already, Kurdistan is a holiday destination withinIraq. Even people from neighbouring countries cometo spend their holidays.

I think minerals will be the next big thing. We needto pass a minerals law. I believe that the Ministry of

Natural Resources is working on a draft. First, weneed to pass the law on how minerals can be ex-ploited. I think there is some confidence that we dohave a fair amount of minerals that would attract alot of international attention.

Beyond these areas, there is health care, educationand ICT. Already, two of the biggest Iraqi telecoms com-panies are Kurdish (Korek and Asiacell). We have areasonable health care system but there is still significantroom for improvement. We are reforming the educa-tion sector. We had the revision of the curriculum. Wehave introduced English at the youngest age possibleand we have encouraged the development of both pri-vate and state schools.

HHooww wwoouulldd yyoouu ddeessccrriibbee KKuurrddiissttaann’’ss rreellaattiioonnss wwiitthhtthhee IIrraaqqii ggoovveerrnnmmeenntt??

We are a part of Iraq, and in 2003, we decided to vol-untarily remain as part of Iraq, which is now inclusiveand democratic. This is what we are committed to. Weare not willing to be a part of an Iraq that is under a dic-tatorship. It was under a dictatorship that our peoplesuffered genocide. While Iraq remains on the path tofederalism, democracy and unity, we will be part of it.

SShhaakkiinngg tthhee dduusstt ffrroomm iittss sshhoouullddeerrss,, EErrbbiill iiss nnoowwhhaaiilleedd aass aa pprriimmee ddeessttiinnaattiioonn ffoorr bbootthh bbuussiinneessssaanndd pplleeaassuurree

There are plenty of reasons to be excited about Erbil:it has a considerable amount of political freedom, aforward-thinking development plan, jaw-droppingscenery and is comparably much safer to visit thanneighbouring Iraqi cities.

Located at the heart of Iraqi Kurdistan, Erbil is one ofthe region’s three governorates (the other two are Su-laymaniyah and Duhok). Although the movement forKurdish autonomy dates back to 1923, it took severaldecades to be achieved, during which time Erbil wasnot even thrown the breadcrumbs from Baghdad’s bud-get. Now, with Kurdistan receiving a 17 per cent shareof Iraq’s federal funds and under the shrewd leader-ship of Erbil’s governor, Nawzad Hadi, infrastructureand development projects are speeding ahead.

“From 1923 until 2004, the Iraqi government onlyspent a small fraction of its budget on Erbil,” explainsMr Hadi. “But now the region has the power to man-age its own budget and is spending wisely, creatinggrowth and attracting floods of people in the form ofboth visitors and human capital.”

He points out: “In 2003, there were around 34,000cars in Erbil, but now we have around half a million,including new models. This reflects the develop-ment here.”

Erbil is also developing as a health care centre forthe whole of Iraq, with patients coming from Basra,Baghdad and other provinces to be treated there. Allthis is evidence of the economic and social progress

that sets Erbil and Kurdistan apart from the rest ofthe country.

“You could say that economically, Erbil is the alter-native to Baghdad. This is the first time that Kurds areinvolved in all sectors. The Constitution gave us the au-thority to do this on our own. Many things have changedin a very short period of time. Even the mentality of thepeople is changing. We are living together now. In Erbil12 or 15 years ago, you never saw any foreign people,but now you do. People can live together, and we areshowing people that we can succeed,” Mr Hadi says.

The Kurdish Regional Government has a develop-mental vision, which involves focusing on the energysector. “We are starting to resolve the issue of electricity,”says Mr Hadi. “We have a master plan and will expandthe city to the north and to the upper river. And we willbe supporting the private sector; all sectors shouldmove together.”

The government is also working to better utilise oth-er resources such as water. “We have good water re-

sources, but up until now, we have not had enoughdams,” the governor explains. “So we have a five-yearplan that focuses on this sector.”

Transport infrastructure is also receiving attention.And the government hopes to increase tourism as aconsequence of the improvements. “We have a planto develop the tourism sector for the future,” explainsMr Hadi. “We have a strong focus on providing goodinfrastructure. We need more highways; for examplefrom Erbil to the Iranian border. This area is predomi-nantly mountainous and we need about $1 billion ofinvestment for highways and tunnels.”

The city’s new airport boasts a long runway of almostfive kilometres, which is capable of receiving a vast rangeof aircraft. As a result, several prestigious new airlines,including Emirates, have been added to its visitor listin the past year – thus bringing in additional touristsand opening up a new cargo route between Erbil andDubai. In addition, a number of luxurious hotels havesprung up and there are plans for a golf course.

Erbil has big ideas when it comes to developingits tourist sector and is already on the right track,having been named the Arab Council of Tourism’s2014 Tourism Capital.

Regional tourism is thriving, but there is workto be done to attract more Western visitors. “Untilnow, tourists have been mostly local, from Iraq(the middle and the south),” says Mr Hadi. “Theytend to go to the mountains. Iranians are also com-ing in – sometimes even famous Iranian singers.Thousands of Kurds are also coming from Iran toour region as well.”

Tourism is not the sole focus of the government’sdevelopment plans – trade relations with the UK arebeing nurtured too. “Our relations with the UK are veryimportant to us,” says Mr Hadi. “We are looking to findmore links and develop the relationship further sothat the UK private sector can work with Kurdistan.We think that is good for both sides.”

The number of development projects demonstratesthe government’s plan to move forward and leave pastsuffering behind. “Kurds never focus on revenge,” re-marks Mr Hadi. “We suffered in the past with theSaddam regime and other previous regimes, but asof 2003, Kurdistan’s policy has not been focused onrevenge, but rather on how to develop the regionand to live in peace.”

Kurdistan has a comprehensive plan to invest inthe future of its people and develop the region to itsmaximum capacity. Its increasing stability and peace-minded political leadership, combined with numer-ous economic development initiatives, makes Kur-distan an investment destination worth considering.

Kurdistan is aforward-looking,

democratic and secularMuslim society.

BAYAN SAMI ABDUL RAHMAN, High Representative of the KRGto the UK

“

ERBIL EMERGES AS LEADING CITY

The Citadel of Erbil is the historical city centre and one of the area’s main tourist attractions


When United Bank arrived in Baghdad in 1983,nobody could imagine that it would become

one of the leading banking institutions in thecountry. From its beginnings, the bank has sincebranched out to create four main branches na-tionwide and its initial 1 billion dinar ($869,000)capital has grown impressively to reach 250 bil-lion dinars. Now, it has made 60 billion dinars inprofit, which is the largest amount ever in Iraqihistory.

United Bank’s bet on Iraq was not visualisedas a short-term strategy and this has been thekey to its success. Jordan Dabbas Group, UnitedBank’s owner, focused on a long-term, forward-thinking approach with international coopera-tion and investment.

Building the infrastructure of a solid banking andfinancial system is helping to strengthen the Kur-dish economy, enable the private sector to flour-ish and society as a whole to develop.

United Bank is also contributing to the devel-opment of the nation’s education in terms ofbanking, which is very low, even if it has a verybright future. United Bank supports companiesby providing bonds for investors and it helps ed-ucate traders by allowing them to understandwhat taking out a loan really means, thereby en-suring profits are kept safe for the bank.

“We are constantly supporting trade and arecommitted to the development of Iraq,” saysHaitham Al Dabbas, Vice-Chairman of the bank.

However, the commitment of United Bank toIraq’s development is not only focused on thetraining of its people with regard to banking. It triesto be much closer to society’s main every-day concerns.

“A strong private sector is the key tothe development of Iraq,” says Mr Al Dab-bas.

United Bank has the firm belief that the mosteffective way of doing this is by investing ina number of sectors, including agriculture, in-dustrial enterprises, trade, tourism, constructionand service projects. Its investments allow such

sectors to grow and also help to en-courage and facilitate foreign invest-ment.

The success story of United Bank was dri-ven by Mr Al Dabbas’ older brother, Fadel AlDabbas, Chairman of the Board of Directorswho played an integral role in the bank’spositive upward trend in recent years.

“The development of the private bankingsector contributes to a large extent in en-hancing the Iraqi economy,” he says.

Today, Kurdistan is rapidly becoming the ide-al place to expand commercial and retail bank-ing activities. United Bank has more than 15branches in Kurdistan’s major cities ofSuleimaniya, Erbil and Duhok. No less than 30private banks are now operating in the region,mainly from Middle Eastern countries.

The rapid growth of these entities is a signof confidence that the Kurdistan Region is anoptimal destination to expand commercialand retail banking businesses in Iraq. Fur-thermore, Iraq’s gov-ernment banks are al-so operating branchesin Kurdistan.

There is considerableroom for growth in the region’sbanking sector. Despite Kurdis-tan’s growing oil wealth, only

20 per cent of people have bank accounts and 70per cent of business payments are made in cash.Only recently are cash machines starting to ap-pear in Kurdistan’s cities.

A look at the invest-ment statistics fromthe past couple ofyears and a compari-son with those of 2012,

shows that investmentin Iraq and Kurdistan is

on the way to doubling.Iraq and Kurdistan have

seen their security situationimprove and that has sent a very

good signal for foreign investors. “Having our own regional government

has encouraged us to start afresh; security andstability are some of the positive attributes of

Kurdistan’s burgeoning economy,” says BayizSaeed Mohammad Talabani, Minister of Financeand Economy of the Kurdistan Regional Govern-ment.

Economic growth in recent years has been im-pressive and the banking and financial sectorsare supporting it. Both public and private sectorsare working hand in hand to establish and de-velop a modern financial system, and they are suc-ceeding. The aim is to measure up to internationalstandards and be connected to world markets. And

to reach this goal, foreign direct investment –along with local investment – is needed.

“Financial support continues to be a key pri-ority of the Kurdish economy,” says Mr Talabani.“We welcome those interested in participating inour development projects.”

The emergence of a network of internationalbanks in the Kurdistan Region is enabling thepopulation to learn and to have access to inter-national banking services present in the coun-try, whose business and investment climate hasimproved over the years. In addition, a lot of ad-ministrative facilities have been incorporated,which has made investing in the banking sectormuch easier today.

Some 16.67 per cent of capital investment isdedicated to investment in the banking sector,which means around $2.3 billion in investmentprojects in the region. The upcoming opening ofthe Erbil Stock Exchange will offer greater flexi-bility and transparency for foreign investors andbring Kurdistan closer to the international fi-nancial community.

The market in Kurdistan offers some of thelargest and most fruitful investments in the worldtoday. With 45 billion barrels of oil reserves andrelative safety, the Kurdistan investment mar-ket will be one of the most profitable over the nextthree to five years.

British investors are more than welcome here.Last September, Iraq held a major London con-vention and offered investors a stake in the coun-try’s economic and financial future. It repre-sented a chance for foreign investors to discov-er the impressive financial potential in a sta-bilised Iraq.

Huge opportunities exist across various in-dustries and the appropriate financing and do-mestic banking sector is being fully established.A very good example of this stability is UnitedBank. Its Vice-Chairman invites foreign investorsto come and see: “Invest in our stocks and beconfident in the security and stability of ourbank,” he says.

The development of the private bankingsector contributes to a large extent in

enhancing the Iraqi economy.

FADEL AL DABBAS, Chairman of United Bank for Investment“

We are constantly supporting trade and are committed

to the development of Iraq.

HAITHAM AL DABBAS, Vice-Chairman of United Bank for Investment“

United for progress in IraqUnited Bank for Investment is a powerful example of a successful international financial firm engaged in the development of Kurdistan


KNOWLEDGE IS POWERDr Loqman Dosky, President of the University ofDuhok (UoD), says that as a result of its history,Kurdistan Region today is a staunch supporter ofinternational ties, and this is what has allowed theregion’s economy to register a 12 per cent growthper year. “Kurdistan Region’s international rela-tions were the first step on the road to our cur-rent economic boom. Our years under dictatorshipreally brought home the importance of democracyand being open to the world,” he says, adding thatthis belief resonates throughout the region’s in-stitutions, including his university. “KurdistanRegion as a whole, including all our organisations,businesses and universities, has its hand ex-tended to people from all nations.”

With regards to the University of Duhok, thisopen-minded approach has translated into col-laborations with several universities abroad and par-ticipation in a number of foreign exchange pro-grammes. For example, the university has been part-nering with the Erasmus Mundus scholarship pro-gramme for the last five years and until recently,they were the only university in Iraq to do so.

These are the types of activities the universi-ty would like to see expanded in the future, in-cluding partnerships with UK universities. “All ofthe classes in the scientific faculties togetherwith the Political and Sociology departments aretaught in English. We would like to explore op-portunities with British universities. We are look-ing forward to expansion,” Dr Dosky adds.

He believes that similarities between Kurdis-tan’s educational system and that of the UK pro-mote close ties between the two countries. “Morethan 85 per cent of the students in our scholar-ship programme choose UK universities to com-plete their higher education, and most of thestaff we have at this university are graduates fromUK universities. The educational system we fol-low here is based on the British system, and allof our scientific colleges and faculties use Eng-lish as the teaching language. We also collabo-rate with several UK universities, including Not-

tingham University and Leicester University. Wesend quite a few students there and share a num-ber of projects, including the DeLPHE Programme,”he explains.

The growth in Kurdistan’s education sector,which now has more than 19 public and privateuniversities, is a natural extension of the re-gion’s positive economic climate, says Dr Dosky.The University of Duhok was established in 1992,with just two faculties of medicine and agricul-ture and 149 students. Today, it boasts nine fac-ulties, more than 46 departments and over11,000 students.

“Today, the effect of this university on the peo-ple here is clearly visible. We have 12 centres fordifferent studies, which include every aspect ofsocietal development. Education isvery important for us, as most prob-lems between different groupsstem from illiteracy. I see the futurehere as very bright and promising,”he concludes.

Dr Loqman Dosky, President of the University of Duhok

As an autonomous region, Kurdistan has a greatdeal of independence when it comes to admin-

istering itself and its dealings with foreign partners.In the field of education, the Kurdistan Regional Gov-ernment (KRG) has taken a strong stance on humanresources and capacity development, revitalising re-search in higher education institutions and inter-nationalising the sector.

Recently, the KRG launched the Human CapacityDevelopment Programme (HCDP) to provide Kurdishgraduates with scholarships for study abroad, par-ticularly in the areas of science and technology. Anannual budget of 120 billion dinars ($103 million)has been allocated, thus giving students a fair op-portunity to pursue degrees in internationallyrenowned universities and return to Kurdistan wellequipped to help modernise the region’s economy.

Of the approximate 2,000 students currentlystudying overseas, some 80 per cent have chosento do their masters and PhDs in the UK. Dr Amanj ASaeed, Advisor to the Minister of Higher Education,attributes this to various factors.

“The historical link between the UK and the Kur-distan region is one. We have a very strong Kurdishcommunity in the UK. On top of that, UK universi-ties were very, very active from the beginning of thescholarship programme. They sent representativesover and put on university fairs. They also helpedstudents with the application process, arrangedseveral courses, etc,” he explains.

Dr Saeed adds that Kurdish students prefer English-speaking countries and that the British Consulatein Erbil provides valuable services, including visas,meaning scholarship recipients do not need to trav-el to Oman or Baghdad to apply.

One setback, however, is the language. AlthoughKurdish, Arabic and English are all used in lectures,classes and seminars, oftentimes students’ levelsof English are insufficient for pursuing higher edu-cation in the UK. Consequently, the KRG plans to in-vest in English-language teaching.

“We have to ask the UK for help and invite high-er education institutions and language courseproviders to deliver language courses in Kurdistanbefore the students leave,” says Dr Saeed.

UK universities already collaborate in Kurdistanthrough direct partnerships with local universities.Dr Saeed cites the example of the University of Soran

and University College Plymouth St Mark & St John(Marjon). The latter established an English languagecentre at Soran, providing the staff, instructors andmanagement, while Soran provides the infrastruc-ture and quality assurance.

“We are planning to adapt the Soran model tomost of the collaborative work that we are planningto do with the UK at the moment,” adds Dr Saeed.

Furthermore, Kurdistan universities are launch-ing an increasing number of joint research projectswith UK institutions – including the University ofLeicester, Plymouth University and the Universityof Nottingham – while others, such as Queen’s Uni-versity Belfast and the University of Essex, haveexpressed interest in opening branch campuses inthe Kurdistan region.

Former Minister of Education and currentspokesperson for the KRG, Safeen Dizayee stress-es that Kurdistan can benefit from cooperation withthe UK, especially in basic education and vocation-al schools. One of the problems in the Kurdistan re-gion, he says, is that the Kurdish culture is to directchildren towards certain professions, thus leavinga gap for skilled labour.

“That is presently being filled by foreign labour,while our young people remain unemployed,” helaments.

“The Ministry of Education presently has a pro-ject of revitalising vocational schools in order tomake it attractive enough for school leavers to learna skill at vocational schools. Then they can imme-diately enter the market after graduation and em-ployers will be after them – and not the other wayround. The vocational school system in the UK is onearea we could learn from. In fact, there have beennegotiations through the British Council here to re-ceive their assistance.”

Kurdistan’s first universities (Salahaddin Uni-versity and University of Sulaimani) were foundedin 1968 and were the only ones until 1992, whenthe University of Dohuk was established. Today,however, there are 19 state and private higher ed-ucation institutions, which include universities,technical and comprehensive universities, and spe-cialised institutions at university level. Nearly 50 percent of the region’s 94,700 tertiary level studentsare female, and tuition is free, as education is con-sidered a basic right in Kurdistan region.

Study abroad andUK collaborationsThe KRG provides thousands of Kurd students withscholarships to pursue advanced degrees abroad, while atthe same time working to improve the quality of highereducation at home

Students graduating from the University of Duhok in spring 2012

IRAQ’S LARGEST INTERNET SERVICE PROVIDER EXPANDS REGIONAL NETWORKAAllllaaii NNeewwrroozz TTeelleecc oomm hhooppeess ttoo ssoooonn bbrriinngg ffiibbrree--ooppttiicc ccoonnnneeccttiioonn ttoo hhoommeess iinn KKuurrddiiss--ttaann’’ss mmaajjoorr cciittiieess

Although telecommunications in the Kurdistanregion have come quite a long way in a shortperiod of time, there is so much room for fur-ther expansion that investors such as KawaJunad, owner and Chairman of Allai NewrozTelecom, are confident about the future of thesector.

“When we started with Newroz in 2007, in-ternet penetration in Iraq was null, and in Kur-distan it was 1 per cent,” recalls Mr Junad. “Butwith our help – we are by far the largest ISP inIraq and Kurdistan – the penetration rate in-creased. Penetration in Iraq is now about 3 to4 per cent, but if you remove Newroz from thepicture, it is only 1 per cent.”

Mr Junad and his company can claim muchof the credit for this growth. Beginning in 2003,the entrepreneur approached the Iraqi govern-ment – which at the time held all telecoms in-frastructure – and offered to help replace theold copper-wire network with a modern fibre-optic one. Mr Junad explains that in order tothen connect Iraq’s improved network with theoutside world, they had to ask Turk Telecom forhelp.

“At that time, even the Turks were not keenon helping and developing Kurdistan,” he says.“But we developed a good relationship with TurkTelecom. Although it is partly owned by the Turk-ish government, there is a strong private sec-tor influence inside the company. It was thefirst time we connected Kurdistan and Iraq withthe rest of the global network.”

Since its establishment in 2007, Newroz has

built and launched a new CDMA (Code DivisionMultiple Access) network in the Kurdish citiesof Erbil, Dohuk and Sulaimanya. The companynow has several projects under way, such as thebuilding of a high-speed broadband ADSL net-work in Erbil and Dohuk and the laying of morethan 1,500 kilometres of fibre-optic cable. MrJunad says that Newroz also has plans to takefibre-optic connections to homes. “They do nothave fibre optic yet in Iran, Kuwait or Jordan,so Kurdistan will be the first in the area to bringfibre optic to homes,” he says.

Helping make all of this possible in the spanof just a few years has been Newroz’s techno-logical partners, including Siemens and Alcatel-Lucent. For Mr Junad it is important that part-ners hold a long-term vision and strategy for theregion and a willingness to share new devel-opments.

“We consider Alcatel-Lucent not only as ourvendors, but our partners as well, because theyexchange ideas with us. We have a frameworkagreement with them for other projects andthey are giving us advice, even if it is not includedin the contract. If your partner develops, theywill develop with you,” he says.

And develop is precisely what Mr Junad wouldlike to see Kurdistan’s telecommunications do,with the help from European, and in particular,British investors.

“There is a huge opportunity to invest here.We can easily get to 60-70 per cent penetration.Before, when we started in 2003, people werelooking for price, and we only had companiesfrom Turkey and Iran and some from China thatwere interested. But now people are looking forquality, and quality can come from countries likethe UK,” he concludes.


Kurdistan is currently experiencing an unprecedent-ed construction boom, reflecting the progress the re-

gion has made since the fall of Saddam Hussein. The de-mand for housing has skyrocketed; more and moreKurds find themselves in a position where they have thefinancial means to buy a home. Tourism is thriving andhas, in turn, led to the development of hotels, themeparks and other necessary infrastructure. At the heartof this surge in the property sector is the Ranj Group.

This Iraqi construction and development companywas set up in 1999. It was born out of the need to es-tablish social stability in the Kurdish region. Contractedfor several projects funded by the now-defunct UnitedNations Oil for Food Programme, the Ranj Group workedfrom the start to improve the lives of the Kurdish peo-ple by building health clinics and schools. Through its deal-ings with the government, the UN and the private sec-tor, the company gained a reputation as one with the high-est standards of quality and workmanship. It has a largefoothold in the private real estate sector in Iraq, and hasbeen involved in a number of exciting developments.

Most notable is the Ranj Tower, an 85-storey build-ing that has become an icon of Kurdistan’s progress.When construction is completed, it will stand as Iraq’stallest building, offering a range of office, retail, recre-ational and residential space. “Thetower is a testament to how far theKurdistan Region has come andis an investment opportunity forthe international community,”says Faxir Maraan, Chairman ofthe Ranj Group.

Regarding international in-vestment, he points out that theKurdistan Regional Government(KRG) is extremely open to outside investment. It of-fers a very favourableinvestment climate,with legislation inplace to benefit theforeign investor.

British companieshave an extra advan-tage investing in theregion, assures MrMaraan. This is due tothe special reverencethat Kurds hold not on-ly for Britain, but alsofor British products.“This country has al-ways been familiar withBritish products andrecognises the quality.

So British producers should pay attention to this mar-ket here, because the people have been brought up on‘Made in Britain’ products, and they are hungry forBritish goods. The Ranj Group would be happy to dis-tribute British brands in Kurdistan.”

One of the main priorities for the Ranj Group, its chair-man says, is “putting Erbil (Kurdistan’s capital) on themap.” It has several projects under way which are sureto help him achieve this goal. These massive develop-ments also demonstrate the region’s economic progress,as well its push to be a freer, more democratic, and West-ernised society. Erbil in particular is going through atransition similar to the one that places like Dubai andAbu Dhabi experienced many years before.

Main projects – either completed or under construc-tion – include shopping malls, hotels, theme parks andstate-of-the-art residential blocks. They have requiredwell over $1 billion of investment.

Warin City, costing $800 million, is the largest resi-dential and commercial complex in Iraq. Situated in themost influential area of Erbil City, it expands over an areaof 875,000 square metres. The residential zones arecomprised of a mixture of luxury houses, villas and apart-ments. The commercial zone includes 14 high-rise officetowers (30-40 floors high) and the largest shoppingmall in Iraq.

Also located in Kurdistan’s thriving capitalis Al-Manara, a residential complex built over

662,500 square metres.At a cost of $150 million,

it includes 1,400 hous-ing units, commer-cial spaces anda medical

centre.

Reflecting the region’s advancements in tourism sec-tor is the construction of a new luxurious hotel, the FourPoints by Sheraton.

With the tourism sector flourishing, Mr Maraan is urg-ing British companies to invest in Erbil, rather than in someof its maybe more obvious neighbours. “It is now importantfor UK companies to look at Erbil. Why would you wantto build tourism in areas that are too hot for a substan-tial part of the year, are less strategically placed and donot have the history that Erbil can offer,” he says.

Also earmarked for completion in five years is amultibillion-dollar development that will see the con-struction of several apartment blocks, hotels and, mostnotably, a Disney theme park. Mr Maraan says that theyare looking for investors in Europe to “help out” with thisgiant undertaking.

In its short 12-year history, the Ranj Group has alsobecome a highly successful investment company. To-day it is one of the largest investment firms in Iraq withtotal investments projects in construction and tourismsectors exceeding $1.5 billion. However, it has not for-gotten its humble roots as a provider of much-neededsocial infrastructure in Kurdistan, such as medical andeducation centres, built in conjunction with the KRG andthe UN in the early 2000s.

In recent times, the Ranj Group built 6,000 low-cost housing units. “We are not looking to make

any profit from this. We did it as part of our cor-porate social responsibility (CSR). We want togive something back to the community. Thisis just one of the number of CSR projects we

are part of,” adds the company’s chairman.The demand for affordable housing in Kurdis-tan has opened the floodgates for those in-terested in investing in the country’s banking

and financial industry, which is still in itsinfancy. One hindrance to the devel-

opment of the housing sector is thelack of mortgages offered for af-fordable housing. “We need banks to start offering10-year mortgages to people,” saysMr Maraan. “Any bank coming herewith such offerings will make bil-lions. There is still so much needfor the mortgages that everyone

will make money.”The banking sector in the region re-

quires huge investment and develop-ment. British banks HSBC and StandardChartered are already operating in Kur-distan, after having recognised its po-tential for investment, and otherrenowned international banks aresure to follow.

Driving Kurdistan’s progressThe Ranj Group has become one of the largest companies in Iraq, and is involved in some exciting developments in Kurdistan

In 2012, high-end hotel company Starwood Ho-tels and Resorts decided to return to Iraq af-ter a nearly 20-year absence due to the GulfWar – and they chose Ranj Company as theirlocal partner.

On signing their first-ever hotel development,Faxir Maraan, Chairman of Ranj Group, com-mented: “We are excited to work with Starwoodto build our first hotel here in Iraq. This is a mile-stone for us and we feel a globally recognisedhotel operator like Starwood is the perfect part-ner in making our first steps in the hospitalityindustry. Four Points by Sheraton has a strongreputation globally and this hotel will be a greataddition to the city of Erbil.”

The new Four Points by Sheraton Erbil Hotelhas a construction cost of $50 million. It willboast 250 well-appointed guest rooms – whichwill include the brand’s signature elements, in-cluding the Four Comfort Bed – as well as ex-tensive dining, conference and leisure facilities.Complimentary WiFi access will be available inpublic areas.

Conveniently located just five minutes fromErbil International Airport, the Four Points bySheraton Erbil Hotel is also situated along thenew ring road, thus affording easy access to thecity and its monuments and attractions, such asthe historic Citadel and Sami Abdul Rahman Park.

The Starwood Corporation has more than 50hotels throughout the Middle East and is on itsway to opening 30 more in the next few years.Under the Four Points by Sheraton brand, it al-ready has six hotels in the regionand will soon openfour new ones.

THE PERFECTPARTNER FOR STARWOOD HOTELS

Left: the future Ainkawa ShoppingMall. Right: An example of the kind

of luxury homes Ranj will build in its

Warin City development

kurdistan region republic of iraq - upper reach

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