In a recent opinion piece in the Times, Lord Jeffrey Archer was enthusiastic about the opportunities to be grasped in modern Iraq:

• “Today [Baghdad] is a boom town, rather than a bomb site. If I were a young man, looking to make my fortune, I would be off to Iraq like a shot.“
• ” … there is an opportunity in Iraq that rivals the gold rush.“
• “If I were 30 and not 70, I would go and find out who wants what and see that they got it.“

He was particularly bullish about Iraqi Kurdistan, with which he has had a long association:

• “The city of Erbil looks like Dubai 15 or 20 years ago.“
• “Go east young man, go to Kurdistan. You could make your first million, and what’s more, you won’t be taxed at 50 per cent.“

And while Lord Archer’s relationship with the truth has sometimes been called into question,  his arguments for Iraq are clearly supported by the evidence, as regular readers of Iraq Business News will be aware.

But it’s not always an easy place to do business, which is why it’s important to get the best advice and guidance.

The difficulties are not all on one side, however: President Barzani spelled out the problems that Iraqis have in getting entry visas to Britain, for example, a problem they do not face in France or Germany. Indeed, we have highlighted this issue in the past.

As ever, the rewards will be reaped by those who face the difficulties and take the risks.

Will your business be part of the Iraqi success story? If so, Upper Quartile and AAIB are the perfect team to help you manage the risks and grasp the opportunities. For more information please contact Gavin Jones or Adrian Shaw.

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The spokesman of the Kurdistan Regional Government (KRG) has dismissed reports that a U.S.-Iraqi delegation will visit Kurdistan to investigate allegations of oil exports to Iran.

Kawa Mahmoud, the KRG spokesman, told AKnews that even if the U.S. delegation arrives in the Region, the visit will be limited to issues concerning the formation of the new Iraqi government.

“No Iraqi delegation has arrived in the Region to discuss oil smuggling issues, the reports claiming this are false,” said Mahmoud.

The issue of alleged oil exports to Iran became a source of controversy in Iraq after a New York Times report stated “hundreds of millions of dollars” worth of oil was “smuggled” from Kurdistan to Iran at a time when the international community was trying to impose tough sanctions on Iran.

Local press recently reported that a joint U.S.-Iraqi delegation had arrived at the Bashmakh borders, east of Sulaimaniya, to investigate the “illegal crude oil transportation” to neighbouring Iran.

Abdul-Kareem Bahid Lu’aibi, the Iraqi deputy oil minister, had previously stated he was not aware of any alleged oil smuggling to Iran.

Meanwhile, in an interview with Rudaw, Dr. Ashti Hawrami, Kurdistan’s Minister of Natural Resources, denied that any oil had been smuggled: “We are 100% sure that Kurdistani crude oil has never been exported”, he said, “except for the four months in which crude oil was exported via the Iraqi pipelines, and that was carried out via SOMO”.

Kurdistan is currently producing approximately 100, 000 barrels of oil a day. The KRG receives 17 percent of its oil revenues with the remainder going to the central government. The oil from the Region is exported to Turkey through a pipeline in Kirkuk.

Recently a 12-year contract was made between the ministry of oil in Baghdad and Turkey to transport crude oil through the Iraqi-Turkish pipeline.

(Sources: AKnews, Rudaw)

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A memorandum of understanding signed with Iraqi officials calls for the import of as much as 300 million cubic feet (8.6 million cubic meters) of gas per day from Iran, an Iranian director said.

Javad Oji, a managing director at the National Iranian Gas Co (NIGC), said an Iranian delegation traveled to Iraq at the weekend to sign preliminary arrangements for Iranian natural gas exports through Iraq, the Iranian Oil Ministry’s Petroenergy Information Network reports.

The director said the deal on the table includes the delivery of as much as 300 million cubic feet of gas per day for a period of five to seven years.

Both sides agreed to form technical, financial and legal working groups to hammer out the details of a final contract.

Delegates at the talks discussed the possibility of shipping Iranian gas to Europe through gas transit networks in Syria, he added.

Iran would most likely pump its gas to Iraq via two pipelines that cross the border at Dehloran and Khorramshahr.

Iran is pushing ahead with plans to build a natural gas pipeline to Pakistan. The country, which holds some of the largest natural gas deposits in the world, has also petitioned for a role in the Nabucco pipeline to Europe. Western supporters of the project ruled out that possibility, however.

(Sources: UPI, MEED, Tehran Times)

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Two oilfields in western Karbala have been listed by the oil ministry within its next oil licensing round, the Mayor of the Ain al-Tamr district said on Tuesday.

“The ministry listed the two oilfields of Naft al-Khadiera, which were discovered in 1991 in the Ain al-Tamr district, within the next licensing round to be invested by global companies specialized in oil industry,” Mahfouz al-Tamimi told Aswat al-Iraq news agency.

(Source: Aswat al-Iraq)

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The Export-Import Bank of the United States (Ex-Im Bank) has opened in Iraq to help finance short-term and medium-term sales of U.S. exports to Iraqi buyers in both the public and private sectors.

“Iraq’s economy is growing, offering specific opportunities for U.S. exporters in a variety of industries. Ex-Im Bank can help by reducing the repayment risk, especially for small businesses at this time,” said Ex-Im Bank Board Member Bijan R. Kian.

Ex-Im Bank can provide export-credit insurance, loan guarantees and direct loans for creditworthy export sales to Iraq. Short-term insurance is available for transactions with repayment terms of 180 days or less, and up to 360 days for capital goods. Medium-term insurance, loan guarantees and loans are available for transactions with terms of up to seven years.

The Bank‘s working capital guarantees (which help U.S. exporters or their suppliers to obtain funds to produce or buy goods or services for export) are available to support exports to Iraq.

The Bank can consider providing long-term support where there are financing arrangements that eliminate or externalize country risks, such as asset-backed financings and structures that earn revenues offshore in a third country.

The Country Limitation Schedule at www.exim.gov provides specific criteria for structuring transactions in both the private and public sectors.

Ex-Im Bank, an independent, self-sustaining federal-government agency, helps create and maintain U.S. jobs by filling gaps in export financing and strengthening U.S. export competitiveness. The Bank provides a variety of financing mechanisms, including working capital guarantees to help small and medium-sized U.S. businesses, export-credit insurance to protect against nonpayment by foreign buyers, and loan guarantees and direct loans to assist foreign buyers of U.S. goods and services.

In fiscal 2009, overall Ex-Im Bank financing totaled $21 billion, and authorizations supporting small-business exports reached a historic high of $4.4 billion, nearly 21 percent of total authorizations.

In the first nine months of fiscal 2010 (through June 2010), Ex-Im Bank authorized $17.4 billion in loans, guarantees and insurance – more than the total amount authorized in fiscal 2008. For more information, see Ex-Im Bank’s Web site at www.exim.gov.

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The value of investment projects in the Iraqi capital has reached $100 billion [120 trillion Iraqi dinars], the Baghdad Mayoralty said on Tuesday.

“The investments are in the housing, hotels, malls, theme parks, and resorts sectors,” the mayoralty said in a press release received by Aswat al-Iraq news agency.

It noted that the Baghdad Mayoralty needs political and executive support to attract more foreign and local investment to the capital.

(Source: Aswat al-Iraq)

(Photo Credit: James Gordon)

AAIB View:

A spokesperson from A.A.I.B. Insurance Brokers said: The Iraqi government has worked hard to encourage foreign investment into the country, especially in Baghdad. Many types of infrastructure need to be redeveloped and new projects and initiatives are needed in all sectors. There are clearly issues and challenges to be dealt with but the opportunities are there and as ever, the degree of political stability and the security climate will be key factors guiding foreign investment decisions.

The recent announcement of a planned $250 million investment to build a business village near Baghdad international airport is a further example of business optimism and hopes to strengthen commercial services in Baghdad.

As regards these investments in housing, hotels, malls, theme parks etc., all can be protected by insurance, both during the construction phase and once the projects are completed and operational. We have seen a number of instances where property in different parts of Iraq has been destroyed or damaged from various causes and as a matter of sound management, insurance programmes should always been considered.

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Kuwait News Agency (KUNA) reports that permission has been granted for a $250 million [300 billion Iraqi dinars] investment to build a business village near Baghdad international airport, provided that it is completed within 5 years. The agency quotes the ‘Iraqi Babylon Investment Authority’, which we believe to be the Baghdad Investment Commission.

Chairman of the commission, Shaker Al-Zameli, said in a statement to the press that they, “granted this investment permission in order to create a business area that attracts commmercial and services investment near Baghdad international airport,” adding that the town would also be a place where commodities could be stored and transferred within and outside Iraq.

A free duty zone would also be set up in the area, from which travelers and Iraqis can benefit, noted Zameli, affirming that the area would boost the Iraqi economy and create more jobs for Iraqis.

(Source: KUNA)

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Business opportunities and investment prospects in Iran and Iraq will be reviewed in a conference in Tehran on August 8.

The Director of the Iranian Privatization Organization (IPO), Gholam-Reza Kord-Zanganeh, who is also secretary of the conference, said that they aim to facilitate an interaction and interchange of ideas and between the two countries’ businesses.

He added that the conference will pave the way for closer relations between the private and public sectors of Iran and Iraq, and help increase trade between the two nations.

The official said that another objective of the organizers is to establish the basis for holding joint exhibitions in each other’s countries.

During the conference the organizers will also arrange specialized panels on commerce, transportation, housing, technical and engineering services, banking, insurance, industry, agriculture, and foreign investments, he stated.

He pointed out that in the Iranian calendar month of Bahman (Jan. 21-Feb.19, 2011) a joint Iran-Iraq exhibition will be held in Baghdad

(Source: Tehran Times)

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