Posted on 21 September 2011.
The Chairman of the Baghdad Investment Commission, Shaker A. Shabib, spoke recently with Padraig O’Hannelly for Iraq Business News, and outlined the opportunities available in Iraq’s capital:
Iraq Business News: I’d like to ask you firstly about the opportunities that are available in Baghdad; we hear a lot about the oil producing regions, but what are the main opportunities for investors in the Baghdad area?
Shakar A. Shabib: There are various opportunities for investors in Baghdad, including production of raw materials for construction, such as bricks and cement.
But also there are some areas of Baghdad where oilfields have been discovered. The area from the east to the south of Baghdad has the potential to produce about 60,000 barrels of oil per day.
There is also potential for industrial projects and factories in sectors including construction, education, health, communications, tourism, and so on.
IBN: And those factories, are they former state industries that will be privatised, or are they already in the private sector.
SS: Basically they are existing factories that can be rehabilitated, and investors can do that, but also there is another area which is allocated to companies which would like to invest in all kinds of industries, such as food, cement factories, steel factories, etc., on terms that are very attractive for investors.
IBN: We all know about electricity shortages in Iraq generally; to what extent is the electricity problem a factor in Baghdad?
SS: Baghdad has a 40% shortage of electricity, as in other cities in Iraq, but recently some projects for investment in Baghdad’s electricity have been announced, and the Ministry of Electricity will buy any production from the investors. When it comes to selling them the power, these projects are mainly under the umbrella of the Ministry of Electricity, but in the meantime companies can talk to the BIC.
IBN: Has there been much interest from investors in producing electricity and selling it to the grid in Baghdad?
SS: We put up capacity of 1,500 MW for investment, and two American companies and one Chinese have shown interest. They are now finalising the details.
IBN: As regards foreign companies coming into Baghdad, what are the main countries investing in your area?
SS: The Turks are the main investors, and many of these companies are close to the Turkish prime minister’s office so he is bringing them in and encouraging them, and they invest in many industrial projects, including electricity generators and transformers. They are also the biggest investors in construction.
IBN: Within Iraq we have the regional investment commissions and the National Investment Commission (NIC) – how is the responsibility divided between the regionals and the national, and how do they work together?
SS: Basically anything up to $250m goes under the umbrella of the regional investment commissions; anything above that goes to the National Investment Commission. Also, some investment projects need to get approval from the relevant ministry, so it depends what kind of projects, but mainly anything under $250m can be decided at regional level.
At the Baghdad Investment Commission, we have issued 120 licences to companies to invest in various sectors, 20 of them in construction, and we even have three projects for universities, including an American university and a British university.
The total value of all these licences is roughly $6 billion.
IBN: Thank you very much for speaking with Iraq Business News.
Iraq Business News: I’d like to ask you firstly about the opportunities that are available in Baghdad; we hear a lot about the oil producing regions, but what are the main opportunities for investors in the Baghdad area?
Shakar A. Shabib: There are various opportunities for investors in Baghdad, including production of raw materials for construction, such as bricks and cement.
But also there are some areas of Baghdad where oilfields have been discovered. The area from the east to the south of Baghdad has the potential to produce about 60,000 barrels of oil per day.
There is also potential for industrial projects and factories in sectors including construction, education, health, communications, tourism, and so on.
IBN: And those factories, are they former state industries that will be privatised, or are they already in the private sector.
SS: Basically they are existing factories that can be rehabilitated, and investors can do that, but also there is another area which is allocated to companies which would like to invest in all kinds of industries, such as food, cement factories, steel factories, etc., on terms that are very attractive for investors.
IBN: We all know about electricity shortages in Iraq generally; to what extent is the electricity problem a factor in Baghdad?
SS: Baghdad has a 40% shortage of electricity, as in other cities in Iraq, but recently some projects for investment in Baghdad’s electricity have been announced, and the Ministry of Electricity will buy any production from the investors. When it comes to selling them the power, these projects are mainly under the umbrella of the Ministry of Electricity, but in the meantime companies can talk to the BIC.
IBN: Has there been much interest from investors in producing electricity and selling it to the grid in Baghdad?
SS: We put up capacity of 1,500 MW for investment, and two American companies and one Chinese have shown interest. They are now finalising the details.
IBN: As regards foreign companies coming into Baghdad, what are the main countries investing in your area?
SS: The Turks are the main investors, and many of these companies are close to the Turkish prime minister’s office so he is bringing them in and encouraging them, and they invest in many industrial projects, including electricity generators and transformers. They are also the biggest investors in construction.
IBN: Within Iraq we have the regional investment commissions and the National Investment Commission (NIC) – how is the responsibility divided between the regionals and the national, and how do they work together?
SS: Basically anything up to $250m goes under the umbrella of the regional investment commissions; anything above that goes to the National Investment Commission. Also, some investment projects need to get approval from the relevant ministry, so it depends what kind of projects, but mainly anything under $250m can be decided at regional level.
At the Baghdad Investment Commission, we have issued 120 licences to companies to invest in various sectors, 20 of them in construction, and we even have three projects for universities, including an American university and a British university.
The total value of all these licences is roughly $6 billion.
IBN: Thank you very much for speaking with Iraq Business News.
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