Doing business in Iraq

Back in its 60s and 70s heyday, Iraq was the most advanced and prosperous nation in the Middle East – its oil revenues and educated population and pro-British stance made for a great place to prosper. The economy and infrastructure collapsed under wars and dictatorship, but now, even though there are protests, there is a rising economic confidence. Oil prices and production are recovering, the government coffers are again full and spending is 45% up in 2019. Iraq is on the way back.

Modern Iraq needs its key infrastructure rebuilt – power, housing, roads, rail and chemical industries and agriculture to name a few. The government is issuing free land areas to develop and tax free incentives for 10 years to encourage people and investors back into Iraq. And the strategy is beginning to work – the Gulf states have pledged billions, while Russian and Chinese oil companies and the Japanese and Koreans are vying to return.

As a British trade council, we have seen a large upswing in membership too – not just from British companies, but many Iraqi’s in construction, services and engineering, as well as international companies like GE and Siemens.

It’s not just power and infrastructure that Iraq needs, but also services and products for a growing consumer market of 40 million people – of whom 65 % are under 21. Telecom companies like Asia Cell (14m) and Zain (19m) have a well networked population that is increasingly easy to reach and want the same goods as western nations. There are many wealthy Iraqi’s keen for Jaguar Landrover’s, flights, luxury goods and banking and investment facilities.

Iraq also has a growing demand for healthcare and education. Stirling Education, Northampton and Bath Spa universities are already there, and there’s plenty of room for our pharmaceutical and medical device providers. The banking and financial system is antiquated and with 69 banks there’s a clear opportunity for fintech and online banking expertise.

So why – and how – should British businesses take the plunge?

UK companies account for over 35% of the Iraqi economy, so we have a surprisingly large footprint in the country and therefore influence. Secondarily, the Iraqis like the Brits as we left a good legacy behind us with infrastructure, and rule of law and fair practice.

But you do need to know how to navigate corruption and ensure you get paid – something we can help with. We have strong relationships with both the Department of International Trade and the Iraqi government. We have a network of friends and partners in all provinces and can also get things done at a local level if required through our office in Baghdad and a permanent representative in Erbil.

And last month we hosted the Iraqi delegation of MPs who said taxation and laws are liberalising fast. And alongside land going free for development, it means those setting up business have the opportunity to become highly profitable and will have the government’s support with any issues.

Iraq is determined to lift the economy, to encourage investment and provide the jobs the young people need. British business interested in speeding that up will be in good company.