StrengthEncouraging Investment Law
We have established an investment law in the region that is really quite business-friendly. Amongst other things, it allows for corporate tax exemption for 10 years, exemption from customs duties for 5 years, connections to public infrastructure, and the allocation of favorable land plots for subsidized lease. This law presents an obvious attraction for foreign investors and I believe the KRG is doing an excellent job of coordinating with the relevant ministries to ensure that the process is active and efficient.Transparency Initiatives
The Board of Investment has placed a strong emphasis on operational transparency. We have contracted Roland Berger, a global strategy-consulting firm, to aid in developing certain sectors in an effort to increase transparency and efficiency. Some of these areas include information presentation and sharing, the development of online services, and the maximization of worker productivity. Our offices do not hesitate to provide requested materials to both local and foreign investors, and we have established strong KRG offices abroad to help facilitate the sharing of information.
The banking sector in the Kurdistan Region is still very new and is therefore not as advanced as would be ideal in terms of supporting the investment climate. Right now, banks are mostly only utilized for basic services like transferring money, saving funds, or distributing cash. However, there is a real need here in the region for banks to provide long-term loans, as well as to support the business environment in terms of the development and implementation of new policies that could facilitate further economic growth.Historical Destruction of the Agricultural Sector
The overall demography of the Kurdistan Region was dramatically altered by the actions of the previous regime: Saddam Hussein destroyed the agricultural infrastructure of the region. He razed villages and moved a large percentage of the rural population to more urban areas. Since 1991, we have attempted to return the demographics of the region to what they once were. However, as a result of the actions of the previous regime, there is currently a lack of innovation or specified knowhow in the agricultural sector. New technologies and approaches are required to rehabilitate the sector, and increased funding is necessary to rebuild the infrastructure of the rural areas.
One method for promoting transparency while simultaneously fighting corruption is to minimize the bureaucracy here in the Kurdistan Region. We have pushed to allow for interaction with the Board of Investment via online pilot services. Currently, it is still more common for private sector companies to visit either the local branches of the Board of Investment or to come here to the central office in Erbil. However, it is our hope that further development of the online licensing process will promote greater equality in terms of investment opportunities.Efficient Marketing
The tendering process for certain projects is handled by the individual ministries with which the project is associated. However, each ministry utilizes different methods for promoting awareness of the tender. Ministry A might simply publish a notice in a local newspaper. Ministry B might put a briefing on the KRG website. Ministry C might only invite those companies with which it already has familiarity. In essence, there are numerous opportunities here in the Kurdistan Region, but there is not, at present, an efficient marketing system in place to attract the broader local community to get involved in those opportunities. We need to develop and implement an official gateway of information to allow for the efficient distribution of strategic materials.