From tourism to manufacturing, to agriculture and transportation, Kurdistan is ready to have others play a bigger role in its economic future, which in turn helps buoy the economic base and stability for all of Iraq. It is indeed the perfect location for a regional base, profitable work in developing infrastructure or launching new businesses outright.
Sectors with the strongest demand and opportunity in the Kurdistan Region include:
- Housing development
- Construction services
- Materials and supplies
- Energy – oil and gas
- Professional services
- Select tourism products/services
- Hotels and hospitality
- Creative/profitable arts and culture entertainment products
Housing & Reconstruction
The KRG places great emphasis on the housing and reconstruction sectors. To meet the growing demands of the Kurdistan Region, the KRG has allocated in its 2010 budget $300m for Housing and Reconstruction projects.
The Ministry of Construction & Housing is one of the most active ministries of the KRG, and manages the housing crises in the Kurdistan region. Strategic projects have been adopted and thousands of housing units are being built in different parts of Kurdistan. For instance, the construction of 5,966 housing units in Erbil, Sulaimani and Dohuk with the value of USD 180,110,502 started in 2009.
Oil & Gas
Much like the rest of Iraq, the Kurdistan Region is blessed with an abundance of natural resources, especially oil and gas.
With the recent announcement of our first ever oil exports from the Kurdistan Region, we have quashed all doubts about whether or not we will be a responsible steward of oil resources located in our region on behalf of all the people of Iraq.
With 45 billion barrels of estimated oil reserves, the Kurdistan Region is poised to become a key part of Iraq’s renaissance and a major actor on world oil markets. The region intends to develop its hydrocarbons resources as per the 2005 Iraqi Constitution and maximise the benefits of this development for the Iraqi people. Since 2003, the region has attracted more than 45 companies from more than 30 countries.
As exploration campaigns continue, the region has shifted to a development phase. Oil production increased from 75,000 barrels in February 2011 to 200,000 barrels today. The target is to reach 1 million barrels of daily production by 2015. For this, capital investment will grow and infrastructure development will be a top priority, including the construction of production and storage sites, transportation pipelines, export and downstream equipment and a plethora of market opportunities for international and domestic companies alike.
By 2019, the region is aiming to produce 2 million barrels daily. By then, we envision the presence of a fully functional oil and gas industry, exporting oil to the world markets, and featuring downstream activities like petrochemicals, fertilisers and other energy-intensive industries.
The Kurdistan Region could hold as much as 200 tcf (5.67 bcm) of natural gas reserves, around 3% of the world’s total reserves. This positions Kurdistan for a prominent role in regional and global gas markets.
Since 2003, large gas discoveries have been made . As exploration activities are intensifying, it is certain that more gas will be discovered and will consolidate the vision of the Kurdistan Regional Government.
Our policy is to first satisfy domestic need for power and industrial uses, and then to export. The first step is to make all the people of Iraq benefit from the underground wealth. We are already using gas for power generation and to help provide electricity to some of our neighbouring governorates, such as Ninevah and Kirkuk, and soon Salahaddin. The KRG has developed gas-fired power generation, with a current capacity of 3 GW and an additional 3 GW in the near future. Any excess gas will be directed towards developing local industries and the domestic gas network.
Later on, available gas will be exported to Turkey, the largest gas consumer in the region. The first export of gas is expected by 2016, providing a reliable source for Turkey. In addition, the Kurdistan Region is looking to Europe, which also needs a secure, reliable and diverse gas supply.
Our environmental policy puts tight restrictions on gas flaring. To ensure that all gas is used and flaring is kept to an absolute minimum, we are encouraging companies to make plans for gas utilisation.
Our rich and still untapped mineral resources can help diversify and bolster Iraq’s and the Kurdistan Region’s economy. Developing Kurdistan’s mineral wealth would encourage investment and bring income and employment. It would also have beneficial effects on other areas of the economy, such as construction materials, metallurgical industries, agriculture and the rehabilitation of local communities.
The Ministry is working to draft a mining law to generate interest in our mining sector, and to ensure that when it is developed it will be managed according to international standards of practice. We expect the private sector to play an important role by investing in and developing our minerals industry.
A draft non-metals mining law is awaiting ratification by the Kurdistan parliament, and a metals mining law will be drafted at a later stage.
There is high potential for deposits of metals such as iron, chromium, nickel, platinum, gold, copper, barite and zinc in a 15-25 kilometre-wide mountainous belt running across the Kurdistan Region. Other areas of the Kurdistan Region are likely to be rich in limestone, gypsum, sands, clays, gravel and evaporates.
The same advantages of stability, security, transparency and competitiveness will naturally translate from Kurdistan’s energy industry as mining operations commence.
Companies with a strong track record in mining that are interested in future mining activities in the region can contact the Ministry of Natural Resources.
Kurdistan’s wealth of high-grade pasturelands has long made it suitable for a pastoralist economy, but it is equally suitable in many areas for intensive agriculture. The pasture lands have remained in reasonably good condition and continue to be a productive source of animal feed. The rich pastures have always ensured that in all historical periods, regardless of how dominant the agricultural sector, there have been nomadic herdsmen exploiting this economic niche to its fullest.
Large and fertile mountain valleys provide ample space for agriculture. Despite its mountainous nature, Kurdistan has more arable land proportionately (28% of its total surface area) than the majority of Middle Eastern countries. Expansive river valleys create a lattice work of fertile fields in Kurdistan, except in the region of the central massif. This may very well explain the fact that many experts feel that agriculture was invented in Kurdistan, as was the domestication of almost all basic cereals and livestock, with the notable exceptions of cows and rice. Since then, the economy has always had an agricultural base, albeit with varying degrees of importance.
A great variety of cereals and vegetables have traditionally been grown in Kurdistan, with wheat and barley the most common. Rice has more recently been given growing preference, and it is displacing bread as the basic food of choice of the Kurdish middle class. Cash crops like tobacco, sugar beets, and cotton are playing a growing role in the local economy. The tobacco is of good quality, with pipe tobacco (also the tobacco of choice for water pipes) of the region being in great demand throughout the Middle East.
Wild berries, particularly black and white mulberries, are found in almost every village, with production for market increasing each year. Mulberries, and to a lesser extent barberries, are currently the berries of choice. Dried, they are used throughout the year. The fruits, including grapes, are grown in large tracts of land. Some quantity is also collected from wild stands. They play an important role in the Kurdish diet, particularly in their dried forms.
Service & Tourism Industry
The tourism industry is fast growing segment of the Kurdistan Region’s economy. Hotels are being built across the Kurdistan Region and more tourists are visiting Kurdistan to explore the mountains, the archeological and historical site. A number of foreign tour companies are operating visitor tours.
Iraqi Kurdistan is a region with stunning natural sites and is dominated by gorgeous mountains, waterfalls, and rivers, and a beautiful countryside. Kurdistan is rich in history and includes such archeological sites as the Sumerian-built citadel known as ‘Qalat’ in Erbil, the infamous Shanidar cave where Neanderthals first buried their dead with flowers, the Zoroastrian and Assyrian sites in Dohuk, what is believed to be the home of the biblical ‘Three Wise Men’ in Amadiyah, the Delal bridge from the Roman Era in Zakho, and many more.