Iraqi business is starving for foreign investment

Business in Iraq is reviving following years of devastation. However, Iraq still desperately needs foreign investors, who might not be too willing to come to the country.

"For these last ten years we have made new streets, new restaurants, new parks, everything is beautiful and safe and it is a good opportunity for foreign companies to come here and work and I am sure they will succeed and find good opportunities here," said Sherwen, an Iraqi businessman from the city of Erbil.

The man sounds optimistic about Iraq’s future. He has to be, as he is in the tourism business in a country that is not exactly considered to be a tourists’ paradise.

"This new project that I have is a small hotel and restaurant, I am alone. I am the management and organize everything by myself," is how Sherwen described his business.

The city of Erbil is located in Iraq’s northern autonomous region of Kurdistan. The area has been relatively protected from violence since the end of the first Gulf War. However, this can’t be said about the rest of the country. After decades of war and conflict throughout the country, it is quite understandable why outside investors feel wary about entering into the market.

Iraq is regularly shaken by sectarian and terrorist acts of violence. Just this week, 30 people were killed in a suicide blast near the Iranian Embassy in the country’s capital, Bagdad.

"The infrastructure is completely in shambles. I mean, well over a million Iraqi people have been killed. There are 5 million refugees internally and externally. And really you have a population that has been at war for 20 years, if you count the first Gulf War. And then 12 years of sanctions, which is another type of economic warfare," said Bill Hackwell, a national organizer for the ANSWER coalition, a US-based antiwar organization.

But local businessmen say they need foreign money and are worth it.

"We need help from the outside, we need our government to allow the foreign companies to come from the outside and do business here because our private companies alone cannot. We need big projects,” said Sherwan.

The country does have something to lure foreign money: its vast energy reserves. A few countries have already started to make bids to do business in Iraq. Russia has launched the process of developing oil refineries near the city of Kirkuk north of Bagdad, and Kurdish Sulaymaniyah.

"Russian companies are interested in working in Iraq. And the fact that Russia opened a Consulate here in good time is a valid proof of the fact that Russian companies do have a possibility to enter the market and work here, while we, as the Consulate General, are to provide them with all possible support, including political and legal support, and any kind of support for all our businessmen and companies that are going to work here," said Vagif Garaev, Russian Consulate General in Erbil.

Still, it will take time and determination for the country’s new government to get back on track.