Iraq attracted $45 billion in new investment so far this year, more than the total for the whole of last year, according to a report by Dunia Frontier Consultants reported by USA Today.
The spike in investment is down to improved confidence in Iraq’s stability, analysts say. Last year Iraq secured $42bn in investment.
Much of the investment is from companies within the Middle-East, but substantial investment from other parts of the world has been flowing in too. French companies account for 9.9 per cent of all investment in Iraq. The U.S. – despite leading the 2003 invasion – only accounts for 4.7 per cent.
U.S. business interest is growing though. Iraq’s commercial attaché office in Washington received 2,251 applications to do business in Iraq in the first half of this year, compared with 1,369 in the same period last year.
South Korea was the largest foreign investor this year, representing 24% of the foreign money flowing into Iraq, according to the report. China also plays a significant role, with a Chinese oil company this month opening the first major oil field in Iraq in 20 years.
Decades of war and sanctions have left Iraq’s economy and infrastructure in tatters. But, it is increasingly seen as an untapped market for foreign investors keen to get in on the action early and secure heavy profits despite the obvious risks.
The need for development in Iraq is great. It’s electrical grid in desperate need of modernization, there are major housing shortages and infrastructure such as transport needs major improvement. Foreign investment is seen as key by some in the alleviation of these problems, while others warn of companies coming into Iraq, making massive profits and doing little to improve the lot of ordinary Iraqis.