Arab states no longer look at the Kurdistan Region of Iraq with suspicion and apprehension, especially after the regional capital, Erbil, was selected as the Arab Capital of Tourism for 2014. Furthermore, economic and trade relations between these states and the Kurdistan region have evolved.
It appears that developments in economic and trade relations between Arab states and the Kurdistan region of northern Iraq have preceded the development of political ties. Statistics released by Kurdish institutions concerned with investment in the area show that Arab companies — particularly from the United Arab Emirates (UAE) and Lebanon — have invested billions of dollars in oil and construction in the region. This has led many Arab states to open consulates and representative commercial offices in Erbil.
Mufti Kamran Raqeeb, the general manager in the Kurdistan Regional Government's (KRG) investment agency, said:
"The KRG's investment law does not differentiate between national and foreign investors. They both have the same rights. This has led to the emergence of Arab and foreign investment in the region."
According to Raqeeb, the region has immense natural resources, including vast agricultural areas and numerous sources of water. This is in addition to other elements that might attract tourism investment. Raqeeb stressed:
"The region has succeeded in opening up politically and economically to the brotherly neighboring states, the Gulf states, Egypt and Lebanon. This includes many prospects for economic cooperation, given that there are many Arab businessmen who are investing their money in the region."
Raqeeb said that the Arab investments have accounted for 10% of all investments in the region, which amounts to $26 billion dollars. The regional government has worked to adopt an investment policy that focuses on three strategic sectors — industry, agriculture and trade — as priorities for the coming years. Said Raqeeb, "We are hoping to expand investment in the region, particularly Arab and foreign investment."