How did SSH decide to enter the Kurdistan Region? What is your overall strategy for 2014-2015?
Kurdistan has a very bright future. Perhaps two years ago a company such as SSH would have thought twice before entering a market like Iraq, but we believe that now is the moment; the time is right for a company like us to bring international standards of quality to this market. Our strategy is to be a strategic partner for architecture, energy and design services, and an employer of choice where ever we operate. We know that we have the vision, values and quality, and feel that the market is much in need of our services. As we only entered the market a few months ago, our market penetration is in the early stages. However, what is unique for SSH, is that we work as sectors spanning across territories. A project in Erbil, for example, will include SSH's top designers from several different offices and countries, including our Kurdistan office. We construct our teams based on the skills of the designers and the needs of the project, which ensures top quality on every project.
How would you say that construction standards are improving in Kurdistan? What is SSH bringing to the market in this regard?
The market is not heavily regulated. We work closely with the public sector and big construction companies and we heavily stress the importance of playing on a level playing field with other designers and contractors in terms of quality and standards. Our quality is on par with top international designers, and we are confident that we are bringing improved quality and standards to Kurdistan. However, we would also like to stress the importance of having equally implemented and enforced standards and regulation. This improves the outcome for the clients, the government, the contractors, and the end user as a whole. The quantity is now here; what Kurdistan needs now is to focus on maintaining high quality in its developments. When it comes to construction, one element that is missing is construction supervision. The construction supervision team must ensure that the contractor is building the project true to the original design, with the right dimensions as well as the right quality and safety standards. This is why, at SSH, we focus on four core components: master planning, infrastructure, buildings, and construction supervision. Construction supervision is particularly important to keep quality standards produced at previous stages.
The market is really shifting from a focus on quantity to a much stronger focus on quality. This, confirmed by feasibility studies, led us to enter the market.
Where does SSH see Kurdistan in its portfolio in the medium term?
It was a milestone for us to open this office in Erbil. SSH was established in Kuwait over 50 years ago and currently our business is expanding in Oman, UAE, Qatar, Bahrain, KSA and Kurdistan. Our focus has changed to become increasingly international. With Kurdistan in particular, we are confident that we are here to stay; we feel that we are in the right place at the right time. While what is happening in much of Iraq right now is de-stabilizing, we know that the KRG has a steady progress in developing the wealth of the region, and has started exporting a significant amount of oil, hopefully reaching 2 million bpd by 2019. There is democratic process and stability, and the need for increased quality infrastructure and construction is broadly understood. All of the elements are in place, and we think that Kurdistan's trajectory will grow quickly. From Q4 of 2014 SSH we are hopefully of gaining real traction in Kurdistan with a number of project wins under our belts.
Did you break into this market on your own or with a local partner?
We have a strategic partner in Kurdistan. When we enter new markets, we do so with local strategic partners—clients or contractors or sometimes other companies. In Kurdistan, we are looking to work with construction and development firms. There are many good developers and we feel the market is in need of companies like us. It was challenging to find a strategic partner that shares our values and can work productively with us. Finally we entered into an MoU with an investment firm. As we are new here, we have yet to begin working on any projects, but we are hopeful that this will change very soon.
Which area of SSH’s work do you see as being strategically most important in Kurdistan currently?
We foresee many important areas for us focusing on building design and infrastructure. Construction supervision, as I mentioned earlier, and master planning also has significant potential here. In truth, however, the market is in need of everything. The built environment has a lot of scope for growth in Kurdistan, and quality is increasingly important. With new water systems, for example, you cannot look to the short term. You must invest in quality, because major infrastructure projects cannot easily be replaced every few years.
Do you feel that momentum from local contractors is heading towards improved quality, or are many still looking for quick returns at the expense of quality?
The government sector has certainly shifted towards quality. The general theme is that they want to invest in quality. When it comes to contractors, of course the contractors are builders at the end of the day and they build to what was designed. It is the responsibility of the private developers to emphasize quality by choosing reputable designers. The private sector, in particular the local developers, are moving gradually in this direction as well as the market increasing demand for quality.