How does regional instability impact Kurdistan’s trade?
Let me put it this way: I was born in 1944. I have seen Iraq when it was a monarchy. I have seen it during the era of General Qasim when the revolution took place in 1958. I have lived here throughout the country’s history; we tend to have peace for 10-15 years and then something erupts. We are used to this now. I remember the first day when Iraq went to war with Iran. After six years, we were doing business in the street while Iranian planes were bombing. It just became a natural part of our lives, unfortunately.
So, now, if there is prolonged instability in the region, we will of course be affected. The situation in Syria is impacting us as well, as evidenced by the fluctuation of the dollar every day. To live in this region is to accept this as the standard, unfortunately.
Here in Kurdistan, we live for today and want to improve in whatever way we can. We don’t really dwell on the past. What’s done is done. It’s far more important to focus on today, as well as our future. This is our priority: to grow in the right way, to develop where we need to develop, and to help our people prosper. This is our mandate.
Kurdistan Region has very robust trade ties with Turkey. How do you assess your current trade relations with Turkey?
I was able to get a message to the Prime Minister of Turkey recently. As a result of that message, Turkey has announced plans to build a third bridge into the Kurdistan Region.
The whole of Iraq, including the Kurdistan Region, produces around 3 million barrels per day [BPD]. Currently, we have two bridges at the border between Turkey and Kurdistan; an average of 2,500 trucks utilize these bridges each week. This is the maximum amount of traffic that these bridges can handle. However, we are planning to increase our BPD from 3 million to between 9 and 12 million; at a minimum, this will triple our capacity. So, logically, those 2,500 trucks will increase to 7,500 or perhaps 8,000. The current bridges can not handle that type of increase. So, we have tried to plan for this increase.
I have good relations with the Minister of Economy of Turkey, Zafer Ça?layan. I talked with him about this situation and was able to get a message to Turkish Prime Minister Erdo?an. Minister Ça?layan spoke with the Prime Minister and said, “We should do what Sinan has asked. It’s in our benefit.”
So, our hope is that we will be able to construct this bridge within a year, because Turkey is obviously our only route for accessing Europe. Right now, Syria is not accessible, so our main point of access is in Mersin, Turkey. If we are able to develop that gateway even further so that it can handle six or seven thousand trucks each day, then our economic situation will improve proportionately.
At the moment, the majority of traffic on those roads is exporting oil. Is there any plan that in the future, exports from the Kurdistan Region will diversify?
We first have to be able to satisfy our internal demands. Once we are able to develop surpluses, then of course we will begin to export. However, right now if we need 10 million tons of cement per year and we are producing 10 million tons, then it isn’t logical for us to try to export. Perhaps if there are compelling trade reasons we could do it, but right now our priority is to establish self-sufficiency. Once we’ve done that, then diversifying our export process is an obvious goal.
In terms of imports, what regulatory standards are in place to ensure that the items are of a certain level of quality?
In the past, there were many products or goods coming into the region that did not meet the standard that we have established. It was a problem. So, we brought in SGS [a Swiss company specializing in inspection, verification, testing, and certification services] to monitor the items that are being imported. 99% of the goods that come from Europe and Turkey pass through these filters without a problem. Certain items coming from other countries may be held up at the border because their quality does not meet the established standard.
We don’t really dwell on the past. What’s done is done. It’s far more important to focus on today, as well as our future. This is our priority: to grow in the right way, to develop where we need to develop, and to help our people prosper. This is our mandate.
How would you categorize trade relations with the United States, at the moment?
They should be much better. Unfortunately, outside of the oil and gas sector, American businessmen aren’t really coming here. There are only about 95 or 96 American companies registered here which, when compared to the number of Turkish companies active in the Kurdistan Region, is nothing. American products are the highest quality, so we would definitely like to increase our economic relations with the United States. Political relations are a bit more challenging, but economic relations should not be.
What is your message to the foreign investors?
Any country or nation that wishes to invest here, the door is wide open. Of course, it depends on how they come in and which sector they wish to invest in.