To attract investors to the Region, the KRG is focusing on maintaining domestic stability, in contrast to the unrest in the broader Middle East. How would you assess the political and democratic consolidation in the Kurdistan Region in recent years? The KRG is still far too dominated by the two main political groups—Gorran’s recent successes notwithstanding—and is far too reliant on petroleum revenues coming from Baghdad for its wellbeing. There is not enough wealth being generated independent of the state in the KRG to sustain a healthy economic and democratic future. This will change and needs time. There is no question that the KRG is in much better shape than the rest of the Middle East. For one thing it is unencumbered by a sense of hostility towards the West and this will, in the long run, help it.
How is the tension between Erbil and Baghdad perceived by the US foreign policy community? How do you envision the US’s role in solving the key issues between both sides? I am pessimistic about the role of the US in managing the Baghdad-Erbil divisions over oil. This is not for lack of trying. This has more to do with the absence of concern in the years past in the KRG by the administration, and its unwillingness to pay attention because there were “few problems” in the north. As a result, US policy has been somewhat unbalanced within Iraq. Washington did not appreciate the sensitivities and needs of the north.
How does the US view the increasingly important relationship between Erbil and Ankara? Has Washington’s perspective changed at all in keeping up with facts on the ground? This is complicated because the US has always wanted better relations between Erbil and Ankara. Now, it seems to have been caught unprepared by the speed and extent of the developments. Washington has appeared opposed to the deepening of the oil relationship, which at best is unhelpful if not downright destructive. I am not saying that there were, or are, easy solutions. These indeed are complex problems, but more nuance and analysis was required.
In what ways is Turkey’s rapprochement with the KRG affecting regional dynamics? The relationship is affecting regional dynamics in many different ways. It strengthens the Kurdish federal region, gives a boost to the peace process in Turkey, and sends strong signals to both Syrian and Iranian Kurds about what is possible in the future. There are, of course, secondary consequences that are difficult to discern at this stage.
How do you assess Kurdistan’s rapid economic development? Have you noticed any increasing awareness about the Kurdistan Region in Washington? Kurdistan is still far too dependent on oil rents. This is a bad omen for both economic development and democracy. Unsurprisingly, the non-Turkish companies most interested in Kurdistan remain those in the hydrocarbon business. The KRG needs to improve its domestic economic base by improving its agricultural base devastated by Saddam’s policies, create niche enterprises in the industrial or service sector, get more people to make a living off their own work and not government service. It also needs to deal with its environment.
In answer to the second question, yes there is more interest in the KRG in Washington. Turkish companies have discovered the Kurdistan Region, and it is a matter of time before American ones do as well. Proximity has its advantages, and Turks will continue to dominate consumer goods industries, but other areas could see greater American investment, especially in infrastructure and, of course, oil and gas.