Ramadan believes that the most influential clause regarding the economic sector in the agreement concluded between Erbil and Baghdad is the one that concerns the amendment of the law on the 2013 general budget.
“As the federal government pays out the dues of foreign companies working in the region through amending the budget’s law, a suitable environment will be set for investment companies, which will usher in an economic boom on the investment as well as production level,” Ramadan explains.
Ramadan stresses that ending financial disputes between Baghdad and Erbil will send a reassuring message to citizens to practice their trades and continue with economic activities. “This means that more liquidity will be pumped into the market, since the Kurdistan region’s budget constitutes a part of Iraq’s general budget.”
The region gets a 17% share of the general budget, a share that was specified in proportion with the population of the three Kurdish provinces of Dohuk, Sulaymaniyah and Erbil.
Statistics issued by the General Investment Commission in the Kurdistan region show that the volume of local and foreign investments in the region since 2007, when the law on private investment was issued, reached $26 billion, mostly in the oil, construction and real estate sectors.
The last agreement between Erbil and Baghdad stipulates setting up a joint committee to settle the oil and gas dispute on the basis of a previous agreement concluded in 2007 between both parties, the amendment of the 2013 budget law and solving the issue of the Tigris, Nineveh, Jazeera and Badiya Operations Command.
Abdel Hamid Zebari is a contributing writer for Al-Monitor’s Iraq Pulse. A reporter from Erbil who works in the field of print journalism and radio, he has published several reports in local and world media, including Agence France-Press and Radio Free Iraq (Radio Free Europe).