Analysis

“The richest country in the world”

Melanie Mingas, BPME editor, blogs about Iraq’s potential after a trip to Basra

Beneath Basra is so much oil that it is visible from a landing plane – a total of 82% of Iraq’s reserves – but after 30 years of war and no investment, you would be hard pressed to believe that it’s probably the richest country in the world.

Amidst the dilapidation are large – albeit neglected – houses, that run off their own generators parked on the street outside, and such elements serve as a reminder of the wealth that lies beneath.

Yes, there are still armed units on the streets, and government buildings and the city’s two main hotels are all encased in a solid concrete blockades; but the actual security threat has decreased significantly in the last year and over that period local authorities have been working to attract the foreign investment needed to rebuild a city that was once an integral component of Iraq’s economy.

The Iraqi authorities have clearly done their homework; trade missions run by the Iraqi Business Union regularly run to Europe and the UK to promote the country’s opportunities to foreign investors.

Companies based in the city and its surrounding areas speak of the wish to form JVs with incoming foreign companies in order to win the upcoming work that they cannot afford to invest in themselves, due to delays in the establishment of a suitable finance system.

Yet while there is aspiration and a clear objective to build a city that rivals Dubai within a generation (or two) the plans are still somewhat embryonic. There is talk of an investment licence, championed by the Iraqi Business Union, but it is advertised within the country on Arabic websites and in Arabic newspapers.

There is “support” and “help” pledged by both the union and the Committee of Economic Development, a local government ministry, but how exactly that support will translate into practical help – when a persistent language barrier exists – remains to be explained.

Head of the Business Union in Basra – which has 18 branches around Iraq and has plans to open others in Iraq and London – Subeh H. Al-Hashemi says: “The demolition is quick, but the rebuild takes time.”

How much time exactly depends on who you ask. Al-Hashemi predicts that in 40 years Basra will rival Dubai, because it has the “economic energy” to do so.

Economic development minister Mahmood, T. Najem Al-Madsoosi, says it will happen in five years. The local businessman estimates 100 – and that even then there will still be progress to be made.

But for the industry, all this time really equates to is opportunity. With the right taxation, finance, urban planning and business frameworks in place, the Middle East can build quickly; very quickly. Every major oil company in the world has a presence in Basra and they are all incredibly active in what is essentially an exercise to turn what lies beneath the city into tangible – breathable – wealth.

And is that money, with the right investment and strategies, which will make these dreams come true.

Comments

Most Popular

To Top