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By John Lee.

Iraq has fallen to a new low in the Economist Intelligence Unit's annual Democracy Index.

Ranking joint 116th out of 167 countries, along with Mozambique, Iraq is classified as "authoritarian".

The score is Iraq's lowest since the Index was created in 2006.

Within the Middle East region, Iraq ranks 9th out of 20 countries, putting it just behind Qatar and just ahead of Jordan.

The Democracy Index provides a snapshot of the state of democracy worldwide based on five categories: electoral process and pluralism, functioning of government, political participation, political culture, and civil liberties.

Based on its scores on a range of indicators within these categories, each country is then classified as one of four types of regime: "full democracy", "flawed democracy", "hybrid regime" or "authoritarian regime".

The full report can be downloaded here.

(Source: EIU)

Near East and North Africa countries focus on nutrition, climate, resilience, water and gender

The 36^th FAO Regional Conference for the Near East (NERC36) started today with a focus on improving nutrition, building resilient rural communities, optimizing water management, addressing the impacts of the climate crisis and fostering green recovery initiatives, as well as gender-sensitive development strategies.

Agrifood sectors are among those struggling to recover from the shocks created by the COVID-19 pandemic over the past two years, and highlight the importance of sustainable and resilient societies, FAO Director-General QU Dongyu said in opening remarks conveyed virtually to the meeting hosted by the Government of Iraq.

"In the Near East and North Africa region, the pre-pandemic food security situation was already critical" with rising hunger and increasing inequalities jeopardizing the welfare of rural populations, women and youth, and worsening water scarcity, he said.

The Director-General outlined four priority areas for innovation and best practice to support the region's recovery: Reducing the urban and rural socio-economic divide by creating better rural employment opportunities; ensuring food security and healthy diets for all; restoring environmental balances; and building resilience against multiple shocks.

"Action at country level is the core of the 2030 Agenda," Qu said, emphasizing the importance of partnerships and cooperation in achieving the 2030 Agenda.

"Dialogue, joint thinking, cooperation , partnership and the development of new strategies to deal with challenges, especially climate change, are among the priorities to achieve common goals," said Prime Minister Mustafa Al-Khadimi of Iraq in opening remarks. "No society can grow at the expense of another."

The inaugural session was also addressed by Muhammad Karim Al-Khafaji, Iraq's Minister for Agriculture, the Chairperson of NERC36, and Hans Hoogeveen, Independent Chairperson of the FAO Council. The Director-General of FAO expressed his gratitude to the government and people of Iraq for hosting NERC36 during challenging times, and for delegations who joined the meeting in Baghdad.

"With the world experiencing the worst food crisis in 100 years, the FAO Regional Conference for the Near East will provide an opportunity to share expertise and review the capabilities of the countries of the region with a view to helping achieve food security," the Iraqi Agriculture Minister, Mohammad Karim Al-Khafaji, highlighted during his opening speech.

"The conference's output is expected to reflect positively on the future of agriculture in Iraq and to help achieve integration among the countries of the region," he added.

NERC36

The regional conference's agenda includes several high-level segments with ministerial roundtables on core themes to be held today. Tomorrow's agenda will include a side event on water, energy and food in the context of the upcoming COP27, followed by the adoption of a ministerial declaration and the report on NERC36.

The Director-General emphasized he has initiated institutional reforms at FAO to give regional offices more strategic power to ensure local action, and that flagship initiatives to support the Organization's Strategic Framework are already at work in the region.

Three countries in the region are already participating in the Hand-in-Hand Initiative, which aims at increasing agricultural production in areas with the highest rates of poverty and hunger. Seven countries are participating in the 1000 Digital Villages Initiative, which seeks to reduce the digital gap faced by smallholders and rural dwellers, while the new One Country One Priority Product initiative, which focuses on products with unique qualities, holds important opportunities for implementation around the region, Qu said.

More actions are forthcoming, he added, as FAO develops a regional strategy on digital innovation and completes the Regional Technical Platform on Water Scarcity, which will become a knowledge hub on the subject allowing countries around the world to benefit from the vast experiences acquired in the Near East and North Africa.

FAO is also hosting a Coordination Hub to shepherd follow-up actions on the ground after the UN Food Systems Summit 2021.

In preparation for the Ministerial meeting, a Senior Officers' meeting (SOM) was organized in virtual format in January. It was attended by 409 participants from 27 Members as well as representatives from the private sector, civil society and academia. The SOM was coordinated by FAO Assistant Director-General Abdul Hakim Rajab Elwaer, Regional Representative for the Near East and North Africa, along with senior officials from Iraq.

The documents submitted to the meeting are available here.

Members of the NERC: Afghanistan, Algeria, Azerbaijan, Bahrain, Cyprus, Djibouti, Egypt, Iran, Iraq, Jordan, Kuwait Kyrgyzstan, Lebanon, Libya, Malta, Mauritania, Morocco, Oman, Pakistan, Qatar, Saudi Arabia, Somalia, Sudan, Syrian Arab Republic, Tunisia, Turkmenistan, United Arab Emirates, Turkey, Yemen.

(Source: FAO)

As a measure of confidence in the global and Iraqi economy, the Iraq Britain Business Council (IBBC) is seeing a marked upswing in quality and quantity of speakers at the Autumn Conference at the Address hotel, Dubai 22nd November.

The topic, in line with COP26 and the new energy horizon, is one of sustainability. Not only is this a key question for the oil and gas sector in Iraq, but also for the diversification of the economy and sustainable finances and industrial sectors within the country. With the hope of formation of a new government and stronger oil prices and government revenues, this could be described as a critical juncture in the evolution of Iraq.

Will the Government make the bold reform steps its people require? Can the economy diversify and enable the private sector to flourish? How will Iraq reform its energy sector and inflect towards renewable power, and develop its agricultural intentions at a time of water scarcity? How best to train and employ the many young people in the short term and how can the digital transformation of Iraq be delivered.

The Oil Minister H.E Ihsan Abdul Jabbar Ismaael intends to attend, along with Dr Salem Chalabi President of TBI, the Iraqi Ambassador to UAE, the British Ambassador to Iraq, and HM Consul General to Middle East. There is a very strong showing among IBBC members, leading IOC's including BP, TotalEnergies, and Basra Gas Company, and major suppliers to the Energy Sector such as Hydro-C and Oilserv and the ability to meet their CEO's at the event.

Professor Frank Gunter will give his insightful analysis of the economic outlook for Iraq and the steps to reform it must take to create a sustainable economy.

Finance too is fielding heavyweight speakers from IFC, Standard Chartered, Sardar Group (Principal Sponsors), Emirates credit insurance and a representative Director General of the Finance Ministry. Of particular interest are companies dedicated to supporting reform in Iraq, notably City and Guilds via GEMs and Stirling Education who are setting up international level qualifications for Iraqi companies for the first time, to raise standards and opportunities for Iraqi companies and youth, and SAP who are dedicated to the digital transformation of Iraq and will be outlining their vision and practical steps to achieve this. Both skills and digital applications are key drivers of a sustainable economy and take centre stage in this respect.

On the Industry Panel we see Dahlia Energy, Sardar Group, Al Busttan and Khudairi discussing the diversification of the economy and how they can help sustain momentum into the future, with their forward-looking businesses.

In parallel the online Tech conference is addressing data and its benefit to Government, business and the citizen. Sponsored by SAP, who will lead on the benefits of data in digital transformation, complimented by UK's GDS, Mastercard on smart cities, UK's Agri-epicentre and British Water and Serco; all leaders in their fields and passionate about the benefits of technology and data in delivering sustainable future economies.

For companies looking to meet the main business leaders in Iraq, this really is a conference to attend. Not only to meet Government officials and ministers, but also the leading supply chain organisations and IOC's and to learn about the future opportunities and likely evolution of Iraq's economy. To this end there is a pre-conference reception the night before at the Iraqi pavilion Dubai Expo 2020, and many opportunities to interact with delegates during lunch and coffee breaks, as well as the ability to sign up to view the conference online.

For more information and the latest speaker line up- please go to: IBBC Autumn Conference - IBBC (iraqbritainbusiness.org)

About the sponsors:

Saradar Group: Principal sponsors

With more than 30 years of rich experience in the automotive sector, Sardar Group became the leading group in the Automotive Sector in Iraq. Their intimate knowledge of the Iraqi market helped import, stock and sell the right brands, types, and models, while their excellent reputation, track record and credibility have helped grow the business times many over since 2003.

Since 2005 with a desire to move from Automobile Trading to providing its customers with all-round Automotive Solutions, Sardar Group started utilizing the synergies of its existing operations to diversify its automotive business activities to include Trading, Leasing of Vehicles, Equipment & Machinery and most importantly Aftersales Service Support.

Today, Sardar Group represents world-renowned automotive brands and heavy construction equipment & machinery exemplified in the following brands:

• Toyota & Hino (in partnership with Sumitomo Corporation)
• Jaguar
• Land Rover
• Polaris
• Doosan
• TOTO

Hydro-C : Gold Sponsors

Hydro-C is catalysing the transition of fossil fuel-based energy to renewables by means of introducing sustainable green solutions into the industry to decarbonise operations and projects, and maintain profitable output. The company plan to focus on Solar, Wind and Hydro powers as a source of energy to achieve net Zero with energy providers and IOCs by 2050 in Iraq. By trading the UK innovative solutions and replicating successful projects which can cut on emissions and support sustainable growth. The company focus is on investing in the young generation, education, new technologies and innovations to support this transition.

SAP: Gold Sponsors

SAP is one of the world's leading producers of software for the management of business processes, developing solutions that facilitate effective data processing and information flow across organizations. SAP helps companies and organizations of all sizes and industries run their businesses profitably, adapt continuously, and grow sustainably. With a global network of customers, partners, employees, and thought leaders, SAP helps the world run better and improves people's lives. SAP is the market leader in enterprise application software, helping companies of all sizes and in all industries run at their best: 77% of the world's transaction revenue touches an SAP system. SAP's machine learning, Internet of Things (IoT), and advanced analytics technologies help turn customers' businesses into intelligent enterprises. Their end-to-end suite of applications and services enables its customers to operate profitably, adapt continuously, and make a different

City&Guilds/ GEMS: Gold Sponsors

City and Guilds was Founded in 1878 and Granted a Royal Charter by Queen Victoria in 1900.

Global leader in skills development. 4 million people each year use City and Guilds to develop skills that help them into a job, develop on that job and prepare for their next job. Global Benchmark operating in Bahrain, Egypt, Jordan, Kuwait, Lebanon, Oman, Palestine, Qatar, Saudi Arabia, Turkey and UAE

Vocational Education / City and Guilds Models in Iraq:

• To Partner with Training Institutions for delivery of City and Guilds qualifications - pathway to work programmes with curricula developed by employers.
• Accredit employers' own training so employees can obtain internationally recognised qualifications.
• Partner with Iraqi investors to set up Private Technical and Vocational Institutions that deliver City and Guild qualifications.

Operational in Baghdad, Basra, Erbil and exploring a project in Najaf.

Serco: Silver Sponsors

Serco is managing Air Traffic control systems in Iraq and internationally. In the Middle East, Serco employs more than 4,500 people across four countries including the United Arab Emirates, the Kingdom of Saudi Arabia, Qatar and Iraq

Basra Gateway Terminal: Bronze Sponsors

Basra Gateway Terminal (BGT) is Iraq's premier container and multi-purpose cargo handling facility. It is situated in Umm Qasr, 50 km from Basra and 500 km from Baghdad.

Operated by International Container Terminal Services Inc. (ICTSI), BGT's team of high-performing Iraqi and International port professionals deliver customer-focused, high productivity and congestion-free port services to Iraq's economy.

Bell Finance LLC: Bronze Sponsors

Bell Finance Limited Liability Company was created in the US State of Delaware in July 2019 to build upon the Iraq Middle Market Development Foundation's lending and educational activities in Iraq since 2005 (www.immdf.org). Bell will continue IMMDF's lending activities by co-financing with Iraqi banks qualifying private sector projects that generate employment and economic growth in Iraq, incorporating Iraqi private sector companies as equity partners. Bell will also continue and expand IMMDF's educational activities in Iraq.

(Source: IBBC)

By John Lee.

Finland's Nokia today announced that Asiacell Telecom has chosen Nokia to build its next-generation microwave network in Iraq.

In the five-year deal, Nokia's Wavence microwave packet radio will help Asiacell address demand for more capacity and provide fiber-like connectivity everywhere, including remote and difficult-to-reach areas

In a press release, Nokia said that this new microwave network will be essential to meet the capacity and provide the ultra-low latency required to delivering compelling experiences to end users:

"For this project, Nokia will replace legacy microwave equipment by either modernizing or deploying approximately 3,000 network links across multiple locations in Iraq over the next five years."

Amer Sunna (pictured), CEO and Managing Director of Asiacell, said:

"We are pleased to extend our partnership with Nokia by trusting them with yet another project. Improving network performance and enhancing the end-user experience has always been our top priority and having Nokia as a strategic partner is helping us achieve this. By leveraging Nokia's global scale, we look forward to building a future-proof network that will help us meet the growing mobile traffic demand in Iraq."

Rima Manna, Head of the Middle East Market Unit at Nokia MEA, said:

"We're delighted that Asiacell has turned to us again to build a reliable and futureproof microwave network. With our Wavence portfolio, we are confident of providing the best-in-class microwave enabling Asiacell to easily upgrade to next-generation technology. This microwave network modernization will allow Asiacell to provide differentiated services and enhance its revenue by introducing new and innovative services."

Asiacell is part of Qatar's Ooredoo Group.

(Source: Nokia)

Menzies Aviation expands MASIL joint venture with launch of passenger services at Baghdad International Airport

Menzies Aviation has announced that it has expanded its joint venture with Iraqi Airways ("MASIL") to offer passenger services at Baghdad International Airport.

MASIL has now assumed operational control of passenger service activities in the Nineveh terminal at Iraq's largest airport as part of its commitment to the Joint Venture Partnership.

As part of the 400 strong team already on the ground, 155 MASIL employees will provide passenger services to Iraq Airways. The partnership is already delivering a suite of ground handling services to customers including Emirates, Qatar Airways, Turkish Airlines, Royal Jordanian, Egypt Air, flydubai and Middle East Airlines.

As part of its long-term strategy for developing the airport's services, MASIL will implement programmes to further enhance the skills of the local workforce to improve customer experience, safety and security standards, and ensure that operations in Baghdad remain in accordance with the global regulations approved by international aviation organizations.

In a statement, the company said that its investment in these training programmes and provision of world-class equipment demonstrates its commitment to establishing Baghdad as a centre of excellence and bolstering the growth of the aviation sector in the Middle East.

Charles Wyley, Executive Vice President, Middle East, Africa and Asia, Menzies Aviation said:

"We're delighted that MASIL is going from strength to strength in Baghdad, from the launch of our Cargo Go Live initiative a few months ago to the commencement of passenger service activities.

"One of the key aims for MASIL is to support the development of Iraqi nationals to assume key positions within the business going forward and we're pleased to see our advanced training programmes are already underway.

"This partnership comes at an exciting and important juncture in Iraq's aviation history as the country looks to upgrade key infrastructure and services at Baghdad International Airport to enable growth and return to being a key regional and international hub for aviation."

(Source: Menzies Aviation)

By John Lee.

Mobile phone service Asiacell has reported a sharp drop in revenue, when expressed in Qatari riyals, as a result of the devaluation of the Iraqi dinar.

In its results for the half year ended 30 June 2021, parent company Ooredoo said:

"Asiacell reported revenue of QAR 1.7 billion during the first half of 2021, a decrease of 12% due to the devaluation of the Iraqi Dinar by 17%, and an improved EBITDA margin of 46% driven by ongoing cost optimisation initiatives.

"Asiacell has invested in its digital transformation programme driven by the need to offer a safe and convenient service to its customers and was recognised for these efforts at the International Finance Awards, for the second year in a row.

"Asiacell's customer base increased by 9% to 14.5 million in H1 2021 compared to 13.3 million in H1 2020."

(Source: Ooredoo)

By John Lee.

Mobile phone service Asiacell has reported a sharp drop in revenue, when expressed in Qatari riyals, as a result of the devaluation of the Iraqi dinar.

In its results for the three-month period ended 31 March 2021, parent company Ooredoo said:

"The Iraqi economy was impacted by weakening purchasing power following the 17% devaluation of the Iraqi Dinar and the effect of the COVID-19 pandemic.

"Asiacell reported revenue of QAR 852 million during the first quarter of 2021 compared to QAR 1,085 million for same period in the previous year.

"Consequently, EBITDA declined 20% to QAR 380 million in Q1 2021 compared to the same period in the previous year. The company's cost optimisation initiatives contributed to a healthy EBITDA margin of 45% in Q1 2021.

"Asiacell maintained its customer base of 14.6 million (Q1 2020: 14.5 million), supported the launch of 4G and new partnerships with OSN and LaLiga, enabling the company to offer bundled services and increase data usage."

(Source: Ooredoo)

The Foreign Minister Receives Secretary General of Gulf Cooperation Council of Arab States to Discuss Gulf Investment in Iraq

Iraq's Foreign Minister Mr. Fuad Hussein has this week discussed investments in Iraq with the Secretary-General of the Gulf Cooperation Council, Dr. Nayef Al-Hajraf.

During the meeting, issues of concern to the Gulf Cooperation Council and Iraq were also discussed, as the Minister welcomed the results of the Al-Ula summit and the return of normal relations between the Kingdom of Saudi Arabia and Qatar, indicating that the natural relations between countries in the region effects positively the Gulf countries and Iraq.

The two sides also discussed economic issues with the Gulf states, and the issue of electrical interconnection and the war against terrorism in addition to preparations for holding early elections in Iraq, and cooperation and coordination in building good relations with regional countries.

On his part, the Secretary General of the Gulf Cooperation Council, Dr. Nayef Al-Hajraf, stated that the Cooperation Council is keen to strengthen relations with Iraq, pointing out that the electrical interconnection program is one of the most important projects that will benefit all.

Mr. Al-Hajraf stressed that the stability of Iraq has positive outcome for the security of the region, and that the Gulf states support the stability of Iraq in its war against terrorism and drying up its sources, indicating that the Iraqi government is capable of extending the law.

(Source: MOFA)

By Ahmed Tabaqchali, CIO of Asia Frontier Capital (AFC) Iraq Fund.

Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Market Review: "Of Assassinations and Corporate Activities"

A quiet start to the new year would have been welcome after the drama of the currency devaluation in December. However, this January, the stage was set for a potential conflict between the US and Iran fought across Iraq.

In mid-December, Iran's supreme leader renewed his revenge vow two weeks ahead the first anniversary, on January 3^rd, of the US strike in Baghdad that killed Iran's top general. At the same time, the prior US administration was escalating its aggressive stance against Iran before its term expired on January 20^th.

The US increased its military presence in the Gulf in the weeks before the anniversary which further exacerbated tensions between the two antagonists. This increased presence was extremely concerning in light of reports in November that the prior US President considered options for attacking Iran's nuclear facilities before leaving office.

While thankfully none of these fears materialised, on January 21^st a suicide bombing took place in central Baghdad for the first time in years, in which the Islamic State Group (ISIS) claimed responsibility. The combination of fears and the bombing had a chilling effect on economic activities, including trading on the Iraq Stock Exchange (ISX) where average daily turnover (excluding block transactions) declined by 26% month on month (chart below).

Foreign buying, a solid trend of the last few months of 2020, almost disappeared, while foreign selling was very low in both relative and absolute terms (second chart below). Not surprisingly, the market, as measured by the Rabee Securities RSISX USD Index, ended the month down 9.3%.

(Source: Iraq Stock Exchange (ISX), Asia Frontier Capital (AFC), data as of January 31^st)

Away from the concerns of the US-Iran conflict, the equity market digested several positive corporate activities that affected listed companies in the banking, consumer, and telecom sectors.

The first corporate development took place in the banking sector with the takeover by the National Bank of Iraq (BNOI) of the Iraqi branch network of Lebanon's Bank Audi,  as part of a larger acquisition by BNOI's parent Capital Bank of Jordan (owning 61.9% of BNOI) of Bank Audi's Jordanian branch network. The combined takeover of the assets and the assumptions of the liabilities of one of Lebanon's top banking institutions in Iraq and Jordan was made possible by Lebanon's financial crisis which forced its banks to halt their international expansion, divest their prized international assets, and refocus on their domestic market. Also, the takeover fits in with Capital Bank of Jordan's expansion strategy in its domestic market, and in its much larger neighbouring market of Iraq, as it seeks to grow both its asset base as well as its revenue streams.

For BNOI, the acquisition increases its assets by IQD 275.0 bln (USD 188.4 mln), or by 32%, to IQD 1,137.6 bln (USD 779.2 mln), and the acquisition takes it into the league of the Iraq Stock Exchange (ISX) largest banks by assets, such as the Bank of Baghdad (BBOB) at IQD 1,248.3 bln (USD 855.0 mln) and Mansour Bank (BMNS) at IQD 1,200.6 bln (USD 822.3 mln). All data are as of end of the third quarter 2020.

While BNOI hasn't reported audited full year 2020 numbers, its unaudited fourth quarter numbers show for 2020 year-over-year pre-tax earnings growth of 116.3%, loan book growth of 88.0%, and deposit growth of 44.9%, for a loan/deposit ratio of 64.5% versus 54.9% in 2019. The December market review "Private Sector Deposit & Loan Growth Continues" looked at the growth of private sector loans and deposits generally, and specifically for selected ISX banking stocks. The piece highlighted with data and charts BNOI's growth in the key metrics of loan book and deposit growth both in absolute terms and relative to its peers on the ISX. Upcoming financial data in 2021 should incorporate the figures from the Iraqi branches of Bank Audi and would provide data for the combined entity's potential future growth rate, while the increased asset size of the combined entity should enhance its competitive market position.

This acquisition by BNOI of Bank Audi's Iraqi branch network is a first in the Iraqi banking sector and is likely to accelerate the sector's development.  It is also the first expansion of the sector following the initial foreign bank's acquisition of major shareholdings in local banks post the March 2003 US invasion of Iraq. Then, the governing Coalition Provisional Authority (CPA) brought the country's legal framework for banking in-line with international standards, and lifted restrictions on foreign participation in the banking industry. A number of regional and international banks bought majority stakes in a number of Iraqi banks to take advantage of the potential growth as banking adoption takes hold in Iraq's cash dominant economy.

Most of these banks, increased their ownership in the selected Iraqi banks and participated in the significant expansion of these banks' capital base between 2011 and 2013. At the time, the Central Bank of Iraq (CBI), mandated all Iraqi banks to increase their capital to at least IQD 100 bln by mid-2011, then to IQD 150 bln by mid-2012, and finally to IQD 250 bln by mid-2013. As of the end of 2019: Al Ahli Bank of Bahrain owned 75.0% of the Commercial Bank of Iraq (BCOI), Burgan Bank of Kuwait owned 51.7% of the Bank of Baghdad (BBOB), Capital Bank of Jordan owned 61.9% of the National Bank of Iraq (BNOI), the National Bank of Kuwait owned 91.0% of the Credit Bank of Iraq (BROI), and Qatar National Bank of Qatar owned 54.2% of Mansour Bank (BMNS).

The second corporate development was in the consumer sector with the acquisition by Pepsi bottler Baghdad Soft Drinks (IBSD) of privately held Al-Zaki Group - another bottler, but of juices and water, and about to extend its offerings to bottled milk. This acquisition fits in with IBSD's strategy of both expanding its product line and deepening its relations with PepsiCo; and follows up on its prior takeover in 2016 of Ynabee' Al Zawraa Company, a bottler of Aquafina, PepsiCo's water brand. The 2016 acquisition increased IBSD's product line and addressable market, and the 2021 acquisition should expand both further. Moreover, while Al-Zaki Group is not a PepsiCo franchisee, it is expected that a successful penetration of the juice market in Iraq by IBSD would enable the group to obtain from PepsiCo the franchise for its Tropicana juice brand.

While IBSD hasn't reported audited full year 2020 numbers, its unaudited fourth quarter numbers show full year revenue growth of 12.6% year-over-year, while pre-tax income was up 20.9% year-over-year.

The final corporate development was in the telecom sector with the introduction of 4G-LTE (fourth generation long-term evolution) by the telecom operators. While the offering is in the very early stages, it promises to bring significant advantages to both internet users and to the ISX's listed mobile telecom operators such as AsiaCell (TASC) and Zain-Iraq (TZNI). Growth in mobile internet usage expanded considerably after 3G was launched by the mobile operators in early 2015 - which currently accounts for a meaningful share of all internet access in the country.

Industry data as of January 2020 shows that there were 29.8 mln internet users, or about 75% of the population, across all devices. Moreover, the number of internet users increased by 55% from 2019 to 2020. While not all of these are mobile internet users, the same data shows that active social media users were 21.0 mln, or about 53% of the population; all of these active social media users accessed the internet via their mobiles. It should be noted that while the phone is the main device for connecting to the internet for most of Iraq's internet users, not all of these connections are through a 3G subscription - a large portion of the population uses their phone to access the  internet via public Wi-Fi networks which might be either fibre broadband or 3G mobile broadband.

This is a massive market with significant growth opportunities as Iraq's mobile internet usage catches up with its regional peers. The introduction of 4G-LTE presents a significant opportunity for the mobile telecom operators to enhance their competitive offerings. Moreover, 4G-LTE's materially faster download-speeds and broader bandwidth versus 3G will allow them to offer meaningfully better service and charge higher prices.

These positive corporate activities in the banking, consumer, and telecom sectors underscore the significant earnings growth opportunities for focused and well-run companies in Iraq's under-developed, yet large, economy. Moreover, these recent developments also underscore the relative attractiveness of the stocks in these sectors, within the context of the Iraqi equity market that is at the tail end of a brutal six-year bear market, and as such a re-rating of the Iraqi equity market along with other frontier markets is likely to happen sooner than generally expected.

Please click here to download Ahmed Tabaqchali's full report in pdf format.

Mr Tabaqchali (@AMTabaqchali) is the CIO of the AFC Iraq Fund, and is an experienced capital markets professional with over 25 years' experience in US and MENA markets. He is a non-resident Fellow at the Institute of Regional and International Studies (IRIS) at the American University of Iraq-Sulaimani (AUIS), and an Adjunct Assistant Professor at AUIS. He is a board member of the Credit Bank of Iraq.

His comments, opinions and analyses are personal views and are intended to be for informational purposes and general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any fund or security or to adopt any investment strategy. It does not constitute legal or tax or investment advice. The information provided in this material is compiled from sources that are believed to be reliable, but no guarantee is made of its correctness, is rendered as at publication date and may change without notice and it is not intended as a complete analysis of every material fact regarding Iraq, the region, market or investment.

Iraqi Civil Aviation Authority awards first international ground services operating license to Menzies' MASIL Joint Venture

Menzies Aviation announced on Thursday that the Iraqi Civil Aviation Authority (ICAA) has awarded the exclusive contract for the delivery of a full suite of ground handling, cargo and fuelling services at Baghdad International Airport to Menzies' joint venture with Iraqi Airways, trading as MASIL.

MASIL is listed as The United Iraqi Company for Airports and Ground Handling Services Limited and is a joint venture between Iraqi Airways, Air BP Limited, Menzies Aviation and Al Burhan Group.

This is the first license of its kind to be awarded by the ICAA to a foreign aviation services company.

The award comes as Iraq looks to global industry players to help grow its aviation industry, a key driver for the economy, with plans to upgrade key infrastructure and services at Iraq's largest airport, Baghdad International Airport. In addition to being the hub airport for Iraqi Airways and Fly Baghdad, it currently handles all aircraft movements for airlines such as Qatar Airways, Emirates and Turkish Airlines.

Menzies' MASIL Joint Venture commenced operations on 21st January, and the joint venture partners intend to draw on their collective global industry experience and world class standards to further improve the customer experience and safety standards at the airport. One of the key aims of the joint venture will be to train and develop Iraqi nationals to assume key positions.

Charles Wyley, EVP Middle East, Asia and Africa at Menzies Aviation, comments:

"We are pleased to have been awarded the exclusive contract at Baghdad International Airport and we look forward to supporting the development of Iraq's world class operating procedures and training schemes.

"Menzies provides passenger, ramp and cargo services at over 200 airports globally and we're excited to share our unparalleled experience to help build knowledge and competence within the workforce in Baghdad."

(Source: Menzies Aviation)