How would you characterize the current investment landscape in Kurdistan? The KRG has set up a favorable legal framework for foreign investment by adopting a new Investment Law in 2006. Thanks to this friendly investment law, the Kurdistan Region attracted over $40 billion of investment between 2006 and 2014. Our trade ties with our neighbors also improved significantly in the same period. However, the budgetary disagreements between Erbil and Baghdad, the plunge in oil prices, and the war against ISIS deeply affected our economy in 2015.
The KRG has three key objectives: create a modern economy, diversify its revenue sources, and improve its investment landscape. In order to attain these goals, the KRG announced reform packages at the beginning of this year. The KRG is committed to boosting its private sector, and diversifying its economy. Kurdistan is a virgin market that offers numerous opportunities for foreign investors. Despite all the challenges, we believe that Kurdistan will be able to successfully overcome these challenges, and we hope to see the same growth level that Kurdistan achieved between 2006 and 14 repeated over the following years.
What are the Ministry’s plans to increase the economy’s attractiveness for foreign investment? We believe that Erbil, Slemani and Duhok are prime investment destinations. Agriculture, mining, industry and tourism are the key sectors that have the greatest potential in the Kurdistan Region in the medium and long term. The Ministry of Trade and Industry in collaboration with the Kurdistan Investment Board has an attractive plan to draw new foreign investment to the Region mainly through the creation of industrial zones. The KRG has new introduced regulations to further increase foreign investment, including more support and administrative assistance. The KRG is discussing with the World Bank, through its program in Iraq, ways to improve the investment landscape in order to achieve the targets set in “KRG Vision 2020”.
The KRG has three key objectives: create a modern economy, diversify its revenue sources, and improve its investment landscape. In order to attain these goals, the KRG announced reform packages at the beginning of this year.
What areas is the Ministry prioritizing in 2016 and beyond? Our focus is to amend existing regulations to improve the environment in Kurdistan for doing business, and to boost trade. Our Ministry has simplified procedures so as to reduce the time needed to obtain licenses and revised the forms related to the payment of taxes and fees. We are also aiming to set up industrial zones in Kurdistan that we believe it is crucially important for the economic development of the Kurdistan Region. One of the key prioritized areas is to improve our trade ties with our neighboring countries. The latest data issued by the Department of Import and Export of the Ministry show that 3,570 licenses worth $4.5 billion were approved by the Ministry of Trade and Industry in 2015. For the first quarter of 2016, 1,276 licenses worth $467 million were approved. We would like to increase this volume in the medium term.